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Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
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<SEC-DOCUMENT>0001137171-05-000493.txt : 20050406
<SEC-HEADER>0001137171-05-000493.hdr.sgml : 20050406
<ACCEPTANCE-DATETIME>20050406172906
ACCESSION NUMBER:		0001137171-05-000493
CONFORMED SUBMISSION TYPE:	20-F
PUBLIC DOCUMENT COUNT:		5
CONFORMED PERIOD OF REPORT:	20041231
FILED AS OF DATE:		20050406
DATE AS OF CHANGE:		20050406

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			CALEDONIA MINING CORP
		CENTRAL INDEX KEY:			0000766011
		STANDARD INDUSTRIAL CLASSIFICATION:	GOLD & SILVER ORES [1040]
		IRS NUMBER:				000000000
		STATE OF INCORPORATION:			A1
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		20-F
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-13345
		FILM NUMBER:		05737749

	BUSINESS ADDRESS:	
		STREET 1:		9-2145 DUNWIN DRIVE
		CITY:			MISSISSAUGA
		STATE:			A6
		ZIP:			L5L 4L9
		BUSINESS PHONE:		9056077543

	MAIL ADDRESS:	
		STREET 1:		9-2145 DUNWIN DRIVE
		CITY:			MISSISSAUGA
		STATE:			A6
		ZIP:			L5L 4L9

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	GOLDEN NORTH RESOURCE CORP
		DATE OF NAME CHANGE:	19920302
</SEC-HEADER>
<DOCUMENT>
<TYPE>20-F
<SEQUENCE>1
<FILENAME>caldonia.htm
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<TITLE>Filed by Filing Services Canada Inc.&nbsp; 403-717-3898</TITLE>
<META NAME="date" CONTENT="04/06/2005">
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<P style="margin:0pt; line-height:28pt; font-family:Times New Roman; font-size:26pt" align=center><font face="Arial">CALEDONIA MINING CORPORATION</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:26pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:28pt; font-family:Times New Roman; font-size:26pt" align=center><font face="Arial">2OF FILING</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:26pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:28pt; font-family:Times New Roman; font-size:26pt" align=center><font face="Arial">U.S. SECURITIES &amp; EXCHANGE</font></P>
<P style="margin:0pt; line-height:28pt; font-family:Times New Roman; font-size:26pt" align=center><font face="Arial">COMMISSION</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:26pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:28pt; font-family:Times New Roman; font-size:26pt" align=center><font face="Arial">2004</font></P>
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<P style="page-break-before:always; margin:0pt; line-height:22pt; font-family:Times New Roman; font-size:20pt" align=center><U><font face="Arial">FORM 2OF</font></U></P>
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<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B><font face="Arial">ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B><font face="Arial">EXCHANGE ACT OF 1934</font></B></P>
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<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=center><font face="Arial"><BR></font></P>
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<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B><font face="Arial">For the fiscal year ended: December 31, 2004</font></B></P>
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<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B><font face="Arial">Commission file Number: 0-13345</font></B></P>
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<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding:3pt; line-height:28pt; font-family:Times New Roman; font-size:26pt; border-left:12pt double #000000; border-top:12pt double #000000; border-right:12pt double #000000; border-bottom:12pt double #000000" align=center><B><font face="Arial">CALEDONIA MINING CORPORATION</font></B></P>
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<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B><font face="Arial">CANADA</font></B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=center><font face="Arial"><BR></font></P>
<P style="line-height: 14pt; font-family: Times New Roman; font-size: 12pt; border-left-style: double; border-left-color: #000000; border-right-style: double; border-right-color: #000000; border-top-style: double; border-top-color: #000000; margin: 0pt; padding: 3pt" align=center><B><font face="Arial">Unit #9, 2145 Dunwin Drive, Mississauga,</font></B></P>
<P style="line-height: 14pt; font-family: Times New Roman; font-size: 12pt; border-left-style: double; border-left-color: #000000; border-right-style: double; border-right-color: #000000; margin: 0pt; padding: 3pt" align=center><B><font face="Arial">Ontario, Canada L5L 4L9</font></B></P>
<P style="line-height: 14pt; font-family: Times New Roman; font-size: 12pt; border-left-style: double; border-left-color: #000000; border-right-style: double; border-right-color: #000000; border-bottom-style: double; border-bottom-color: #000000; margin: 0pt; padding: 3pt" align=center><B><font face="Arial">Tel: (905) 607-7543</font></B></P>
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<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=center><font face="Arial"><BR></font></P>
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<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR><BR></font></P>
<font face="Arial">
<BR>
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<P style="line-height: 13pt; font-family: Times New Roman; font-size: 11pt; text-indent: 0; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=justify><font face="Arial">Securities registered or to be registered pursuant to Section 12(b) of the Act.</font></P>
<P style="line-height: 13pt; font-family: Times New Roman; font-size: 11pt; text-indent: 0; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=justify>&nbsp;</P>
<P style="line-height: 13pt; font-family: Times New Roman; font-size: 11pt; text-indent: 0; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=justify><font face="Arial"><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NIL &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NIL &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></font></P>
<P style="line-height: 13pt; font-family: Times New Roman; font-size: 11pt; text-indent: 0; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=justify><font face="Arial">(Title of each class)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(Name of each exchange on which registered)</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial">Securities registered or to be registered pursuant to Section 12(g) of the Act.</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><U><font face="Arial">Common shares without par value</font></U></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial">(Title of class)</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial">Securities for which there is a reporting obligation Pursuant to Section 15(d) of the Act.</font></P>
<P style="font-family: Times New Roman; font-size: 11pt; text-indent: 0; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=justify><font face="Arial"><BR></font></P>
<P style="line-height: 13pt; font-family: Times New Roman; font-size: 11pt; text-indent: 0; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=justify><U><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NIL &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></U></P>
<P style="line-height: 13pt; font-family: Times New Roman; font-size: 11pt; text-indent: 0; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=justify><font face="Arial">(Title of class)</font></P>
<P style="text-indent: 0; font-family: Times New Roman; font-size: 11pt; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0; padding-left: 108pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial">Number of outstanding shares of each of the issuer's classes of capital or common stock as of the close of the period covered by the Annual Report.</font></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify>&nbsp;</P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><B><U>&nbsp;&nbsp;</U></B><U>301,112,286 &nbsp;&nbsp;&nbsp;&nbsp;</U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>(as of December 31, 2004)</U></font></P>
<P style="line-height: 13pt; font-family: Times New Roman; font-size: 11pt; text-indent: 0; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=justify><font face="Arial">(Common shares)</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="line-height: 13pt; font-family: Times New Roman; font-size: 11pt; text-indent: 0; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=justify><font face="Arial">Indicate whether the Registrant (1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.</font></P>
<P style="line-height: 13pt; font-family: Times New Roman; font-size: 11pt; text-indent: 0; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=justify>&nbsp;</P>
<P style="line-height: 13pt; font-family: Times New Roman; font-size: 11pt; text-indent: 0; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=justify><font face="Arial">Yes &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>X</U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
No&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="line-height: 13pt; font-family: Times New Roman; font-size: 11pt; text-indent: 0; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=justify><font face="Arial">Indicate which financial statement item the Registrant has elected to follow:</font></P>
<P style="line-height: 13pt; font-family: Times New Roman; font-size: 11pt; text-indent: 0; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=justify>&nbsp;</P>
<P style="line-height: 13pt; font-family: Times New Roman; font-size: 11pt; text-indent: 0; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=justify><font face="Arial">Item 17 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>X</U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;Item 18</font></P>
<P style="text-indent: 0; line-height: 13pt; font-family: Times New Roman; font-size: 11pt; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0; padding-left: 180pt" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-13pt; padding-left:36pt; text-indent:-36pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial">NOTE:</font></P>
<P style="margin:0pt; padding-left:36pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial">Caledonia Mining Corporation was created on February 5, 1992 following the amalgamation of its three predecessor companies, namely Golden North Resource Corporation, Thorco Resources Inc. and Doelcam Mining Corporation. &nbsp;For accounting purposes, the Amalgamation was treated as a purchase acquisition by Doelcam Mining Corporation of the other two predecessor companies.</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-13pt; padding-left:72pt; text-indent:-72pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><B><font face="Arial">NOTE:</font></B></P>
<P style="margin:0pt; padding-left:72pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><B><font face="Arial">&nbsp;&nbsp;That all reference to monies herein are to Canadian dollars unless otherwise specifically indicated.</font></B></P>
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<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=center><B><font face="Arial">PART 1</font></B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-13pt; padding-left:36pt; text-indent:-36pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><B><font face="Arial">1.</font></B></P>
<P style="margin:0pt; padding-left:36pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><B><font face="Arial">IDENTITY of DIRECTORS, SENIOR MANAGEMENT AND ADVISERS</font></B></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:72pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">1.</font></B></P>
<P style="margin:0pt; padding-left:72pt; line-height:13pt; font-family:Times New Roman" align=justify><B><font face="Arial">Directors and senior management</font></B></P>
<P style="margin:0pt; text-indent:72pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial">Not required as this is an &#147;annual report under the Exchange Act&#146;.</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:72pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">2.</font></B></P>
<P style="margin:0pt; padding-left:72pt; line-height:13pt; font-family:Times New Roman" align=justify><B><font face="Arial">Advisers</font></B></P>
<P style="margin:0pt; text-indent:72pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial">Not required as this is an &#147;annual report under the Exchange Act&#148;.</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:72pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">3.</font></B></P>
<P style="margin:0pt; padding-left:72pt; line-height:13pt; font-family:Times New Roman" align=justify><B><font face="Arial">Auditors</font></B></P>
<P style="margin:0pt; text-indent:72pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial">Not required as this is an &#147;annual report under the Exchange Act&#148;.</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><B>However, the information required above can readily be determined from the 2004 Annual Report of the respondent on pages 46 and 47</B><FONT COLOR=#0000FF>.</FONT></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-13pt; padding-left:36pt; text-indent:-36pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><B><font face="Arial">2.</font></B></P>
<P style="margin:0pt; padding-left:36pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><B><font face="Arial">OFFER STATISTICS AND TIMETABLE</font></B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:72pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">1.</font></B></P>
<P style="margin:0pt; padding-left:72pt; line-height:13pt; font-family:Times New Roman" align=justify><B><font face="Arial">Offer Statistics</font></B></P>
<P style="margin:0pt; text-indent:72pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial">Not required as this is an &#147;annual report under the Exchange Act&#148;.</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:72pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">2.</font></B></P>
<P style="margin:0pt; padding-left:72pt; line-height:13pt; font-family:Times New Roman" align=justify><B><font face="Arial">Method and expected timetable</font></B></P>
<P style="margin:0pt; text-indent:72pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial">Not required as this is an &#147;annual report under the Exchange Act&#148;.</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-13pt; padding-left:36pt; text-indent:-36pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><B><font face="Arial">3.</font></B></P>
<P style="margin:0pt; padding-left:36pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><B><font face="Arial">KEY INFORMATION</font></B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:72pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">1.</font></B></P>
<P style="margin:0pt; padding-left:72pt; line-height:13pt; font-family:Times New Roman" align=justify><font face="Arial">Selected Financial Data</font></P>
<P style="margin:0pt; padding-left:72pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><B><I>Table 3 A</I></B> shows the applicable selected financial data for the 5-year period 2000 to 2004 in Canadian Generally Accepted Accounting Principles.</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:72pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><B><I>Table 3 A (i)</I> </B>shows the applicable selected financial data for the 5-year period 2000 to 2004 in United States Generally Accepted Accounting Principles.</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:72pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><font face="Arial"><B><I>Table 3 A (ii)</I></B> shows the US$<B> </B>exchange rates against the $ Canadian for each of the 5 year periods indicated, for the period end and average exchange rate and the range of high and low rates for each year and the high and low exchange rates for the individual last six months ending February 2005.</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=justify><font face="Arial"><BR><BR></font></P>
<font face="Arial">
<BR>
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
<BR>
</font>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman" align="center"><B><font face="Arial">Table 3A - Selected Financial Information - Canadian Generally Accepted Accounting Principles</font> </B></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border-left:0.9pt solid #000000; border-top:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
</TD><TD style="border-top:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="line-height: 100%; font-family: Times New Roman; font-size: 8pt; margin: 0pt" align=center><font face="Arial"><BR></font></P>
<P style="line-height: 100%; font-family: Times New Roman; font-size: 8pt; margin: 0pt" align=center><B><font face="Arial">2004</font></B></P>
<P style="line-height: 100%; font-family: Times New Roman; font-size: 8pt; margin: 0pt" align=center>&nbsp;</P>
</TD><TD style="border-top:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.733><P style="line-height: 100%; font-family: Times New Roman; font-size: 8pt; margin: 0pt" align=center><font face="Arial"><BR></font></P>
<P style="line-height: 100%; font-family: Times New Roman; font-size: 9pt; margin: 0pt" align=center><font face="Arial">2003<SUP>(1</SUP><B><SUP>)</SUP></B></font></P>
<P style="line-height: 100%; font-family: Times New Roman; font-size: 9pt; margin: 0pt" align=center>&nbsp;</P>
</TD><TD style="border-top:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="line-height: 100%; font-family: Times New Roman; font-size: 8pt; margin: 0pt" align=center><font face="Arial"><BR></font></P>
<P style="line-height: 100%; font-family: Times New Roman; font-size: 9pt; margin: 0pt" align=center><font face="Arial">2002<SUP>(1)</SUP></font></P>
<P style="line-height: 100%; font-family: Times New Roman; font-size: 9pt; margin: 0pt" align=center>&nbsp;</P>
</TD><TD style="border-top:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.733><P style="line-height: 100%; font-family: Times New Roman; font-size: 8pt; margin: 0pt" align=center><font face="Arial"><BR></font></P>
<P style="line-height: 100%; font-family: Times New Roman; font-size: 9pt; margin: 0pt" align=center><font face="Arial">2001<SUP>(1)</SUP></font></P>
<P style="line-height: 100%; font-family: Times New Roman; font-size: 9pt; margin: 0pt" align=center>&nbsp;</P>
</TD><TD style="border-top:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="line-height: 100%; font-family: Times New Roman; font-size: 8pt; margin: 0pt" align=center><font face="Arial"><BR></font></P>
<P style="line-height: 100%; font-family: Times New Roman; font-size: 9pt; margin: 0pt" align=center><font face="Arial">2000<SUP>(1)</SUP></font></P>
<P style="line-height: 100%; font-family: Times New Roman; font-size: 9pt; margin: 0pt" align=center>&nbsp;</P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=center><B><font face="Arial">Financial - $ Thousands Cdn except per share amounts</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Garamond; font-size:8pt" align=center><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Garamond; font-size:8pt" align=center><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Garamond; font-size:8pt" align=center><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Garamond; font-size:8pt" align=center><font face="Arial"><BR></font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Revenue from Operations</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">841</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">646</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">27</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">124</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">6,623</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Garamond; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Garamond; font-size:8pt"><font face="Arial">Gross Profit (Loss)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">(5,610)</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(2,984)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(118)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(143)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">284</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Garamond; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Garamond; font-size:8pt"><font face="Arial">Earnings (loss) from Continuing Operations</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">(9,979)</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(14,496)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(4,446)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(1,096)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(1,552)</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Garamond; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Garamond; font-size:8pt"><font face="Arial">Expenses (General, Administration, Interest, Amortization)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">2,959</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,841</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,585</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Garamond; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,130</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">2,143</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Net Income (Loss) for the Year</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">(9,979)</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(14,496)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(4,446)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(1,096)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">7,451</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Cash</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">6,470</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">4,179</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,864</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">90</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">75</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Current Assets</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">7,481</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">4,573</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">2,094</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">184</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">200</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Total Assets</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">23,666</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">19,530</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">24,969</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">25,183</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">25,273</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Current Liabilities</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">1,062</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">790</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,336</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">2,701</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">2,556</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Long Term Liabilities</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">423</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,089</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,073</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,499</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,598</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Working Capital (Deficiency)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">6,419</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">3,783</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">758</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(2,517)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(2,356)</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Shareholders&#146; Equity</font> </P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">22,181</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">17,651</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">22,560</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">20,983</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">21,119</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Total Capital Expenditures</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">3,813</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">2,279</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">613</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">23</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">120</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Expenditures on Mineral Properties</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">2,298</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">2,042</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">624</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">23</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">120</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=293><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Financing Raised</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">14,314</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">9,511</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.5pt solid #000000" valign=bottom width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">5,174</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,078</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">979</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:1pt solid #000000; border-bottom:0.5pt solid #000000" width=293><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Dividends Declared</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">-</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:0.5pt solid #000000" valign=bottom width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=56.733><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">-</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=56.667><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">-</font></P>
</TD></TR>
<TR><TD style="border-left: 0.5pt solid #000000; border-right: 1 solid #000000; border-bottom: 0.5pt solid #000000" valign=top width=576.467 colspan=6><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Share Information</font></B></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial"><BR></font></P>
</TD></TR>
</TABLE>
  </center>
</div>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border-left: 0.5pt solid #000000; border-right: 0.5pt solid #000000; border-bottom: 0.5pt solid #000000" width=290><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Market Capitalization ($ Thousands)</font></P>
</TD><TD style="border-right:0.5pt solid #000000" valign=top width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">39,145</font></B></P>
</TD><TD style="border-right:0.5pt solid #000000" valign=top width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">105,955</font></P>
</TD><TD style="border-right:0.5pt solid #000000" valign=bottom width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;86,836</font></P>
</TD><TD style="border-right:0.5pt solid #000000" width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">9,086</font></P>
</TD><TD style="border-right:0.5pt solid #000000" width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">10,374</font></P>
</TD></TR>
</TABLE>
  </center>
</div>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border-left: 0.5pt solid #000000; border-right: 0.5pt solid #000000; border-bottom: 0.5pt solid #000000" valign=top width=290><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Shares Outstanding (Thousands)</font></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">301,112</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">252,274</font></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">211,795</font></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">165,202</font></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">148,202</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=290><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Warrants &amp; Options (Thousands)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">52,342</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">27,348</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">28,055</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">19,566</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">7,566</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=290><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Earnings (Loss) per Share</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">(0.034)</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(0.063)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(0.023)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(0.008)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">0.080</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=290><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Net Loss from Continuing Operations per Share</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">(0.034)</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(0.063)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(0.023)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(0.008)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=57><P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:8pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(0.02)</font></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin-top:0pt; margin-bottom:-9.55pt; line-height:9.55pt; font-family:Times New Roman" align=justify>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-9.55pt; line-height:9.55pt; font-family:Times New Roman" align=justify>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-9.55pt; line-height:9.55pt; font-family:Times New Roman" align=justify>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-9.55pt; line-height:9.55pt; font-family:Times New Roman" align=justify>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-9.55pt; line-height:9.55pt; font-family:Times New Roman" align=justify>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-9.55pt; line-height:9.55pt; font-family:Times New Roman" align=justify>&nbsp;</P>
<P style="line-height: 9.55pt; font-family: Times New Roman; margin-top: 0pt; margin-bottom: 0" align=justify><font face="Arial"><SUP>(1)&nbsp;&nbsp;&nbsp;</SUP>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Restated for the adoption of the Asset Retirement Obligations change in accounting policy<B>.</B></font></P>
<P style="margin:0pt; line-height:7.55pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:7.55pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:7.55pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:7.55pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR>
<BR>
<BR>
</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=center><B><font face="Arial">Table 3A (i) - Selected Financial Information - United States Generally Accepted Accounting Principles</font></B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=justify><font face="Arial"><BR></font></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border-left:0.9pt solid #000000; border-top:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=206.4><font face="Arial">&nbsp;</font></TD><TD style="border-top:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=52.133><P style="margin:0pt; font-family:Times New Roman"><B><font face="Arial">2004</font></B></P>
</TD><TD style="border-top:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=52.133><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">2003</font></P>
</TD><TD style="border-top:0.9pt solid #000000; border-bottom:0.9pt solid #000000" width=52.133><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">2002</font></P>
</TD><TD style="border-top:0.9pt solid #000000; border-bottom:0.9pt solid #000000" width=52.133><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">2001</font></P>
</TD><TD style="border-right: 1 solid #000000; border-top: 0.9pt solid #000000; border-bottom: 0.9pt solid #000000" width=52.6><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">2000</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Revenue from Operations</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">841</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">646</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">27</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">124</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">6,623</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Gross Profit (Loss)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">(5,610)</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(2,984)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(103)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(126)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">304</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Earnings (loss) from Continuing Operations</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:9pt; font-family:Times New Roman; font-size:7pt" align=right><B><font face="Arial">(10,385)</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(5,544)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(3,795)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(1,202)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(2,481)</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Expenses (General and Administration, Interest and Amortization)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">2,959</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,841</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,585</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,130</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">2,143</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Net Income (Loss)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:1pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:9pt; font-family:Times New Roman; font-size:7pt" align=right><B><font face="Arial">(10,385)</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:1pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(4,985)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(3,795)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(1,202)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">9,574</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:1pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Total Comprehensive Loss</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:9pt; font-family:Times New Roman; font-size:7pt" align=right><B><font face="Arial">(10,421)</font></B></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(4,985)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(3,795)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(1,202)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">9,574</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:1pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Cash</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">6,470</font></B></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">4,179</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,864</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">90</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">75</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Current Assets</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">7,481</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">4,573</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">2,094</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">184</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">200</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Total Assets</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">20,977</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">17,283</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">13,439</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">11,342</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">11,439</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Current Liabilities</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">1,062</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">790</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,336</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">2,701</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">2,556</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Long Term Liabilities</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><B><font face="Arial">423</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,089</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,280</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,813</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,813</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Working Capital (Deficiency)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">6,419</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">3,783</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">758</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(2,517)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(2,356)</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Shareholders&#146; Equity (Deficiency)</font> </P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">19,492</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">15,404</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">10,823</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">6,828</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">7,070</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Total Capital Expenditures</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">1,515</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">237</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(11)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">-</font></B></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Expenditures on Mineral Properties</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">2,298</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">2,042</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">624</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">23</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">120</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Financing Raised</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">14,314</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">9,511</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">5,174</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">1,078</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">979</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Dividends Declared</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">-</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">-</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">-</font></B></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><B><font face="Arial">Share Information</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=52.133><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Market Capitalization ($ Thousands)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">39,145</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">105,955</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">86,836</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">9,088</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">10,374</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Shares Outstanding (Thousands)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">301,112</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">252,274</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">211,795</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">165,202</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">148,202</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Warrants &amp; Options (Thousands)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">52,342</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">27,348</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">28,055</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">19,566</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">7,566</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; font-family:Times New Roman; font-size:7pt"><font face="Arial">Basic and Diluted Earnings (Loss) per Share from Continuing Operations</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">(0.036)</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(0.024)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(0.020)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(0.008)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(0.030)</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=206.4><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Basic and Diluted Net Income (Loss) per Share</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><B><font face="Arial">(0.036)</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(0.022)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(0.020)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.133><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">(0.008)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=52.6><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=right><font face="Arial">0.090</font></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt; line-height:7.55pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><B><font face="Arial">Table 3A (ii) - Summary of Exchange Rates for the 5-year Period - 2000 to 2004</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">The following table sets forth, for each of the years indicated, the exchange rate of the United States dollar into Canadian currency at the end of such year, the average exchange rate during each such year and the range of high and low rates for each such year as supplied by the Bank of Canada.</font></P>
<B><P style="margin:0pt; text-indent:72pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></B></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border:0.9pt solid #000000" valign=top width=178.2><P style="margin:0pt; font-family:Arial" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><B><font face="Arial">Exchange Rate</font></B></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.667><P style="margin:0pt; font-family:Arial"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Arial; font-size:8pt" align=center><B><font face="Arial">2004</font></B></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=75.667><P style="margin:0pt; font-family:Arial" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Arial; font-size:8pt" align=center><font face="Arial">2003</font></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=75.667><P style="margin:0pt; font-family:Arial" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">2002</font></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=75.6><P style="margin:0pt; font-family:Arial" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">2001</font></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=bottom width=75.6><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">2000</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=178.2><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Rate at the End of the Period<B> </B>(1)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.667><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><B><font face="Arial">1.2020</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.667><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">1.2965</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.667><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">1.5591</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">1.5775</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">1.4995</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=178.2><P style="margin:0pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Average Rate (2)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.667><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><B><font face="Arial">1.3000</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.667><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">1.4015</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.667><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">1.5703</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">1.5490</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">1.4854</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=178.2><P style="margin:0pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">High Rate (1)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.667><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><B><font face="Arial">1.3957</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.667><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">1.5777</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.667><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">1.6033</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">1.5955</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">1.4341</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=178.2><P style="margin:0pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Low Rate (1)</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.667><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><B><font face="Arial">1.1759</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.667><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">1.2839</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.667><P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">1.5276</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Arial" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">1.4991</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=center><font face="Arial">1.5593</font></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt; font-family:Arial; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:10pt; font-family:Arial; font-size:8pt"><B><font face="Arial">Notes:</font></B></P>
<P style="margin-top:0pt; margin-bottom:-10pt; padding-left:36pt; text-indent:-36pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=justify><font face="Arial">(1)</font></P>
<P style="margin:0pt; padding-left:36pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=justify><font face="Arial">The rate of exchange is the Bank of Canada closing rate for the period.</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:8pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-10pt; padding-left:36pt; text-indent:-36pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=justify><font face="Arial">(2)</font></P>
<P style="margin:0pt; padding-left:36pt; line-height:10pt; font-family:Times New Roman; font-size:8pt" align=justify><font face="Arial">The average rate means the average of the exchange rates during the year.</font></P>
<font face="Arial">
<BR>
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
<BR>
</font>
<P style="margin:0pt; font-family:Courier; font-size:8pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:8pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">The high and low rates of exchange for each of the 6 months from September 2004 to February 2005 are as follows:</font></P>
<P style="margin:0pt; font-family:Courier; font-size:8pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:288pt; text-indent:-216pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><B><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sept. 2004 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Oct. 2004 &nbsp;&nbsp;&nbsp;&nbsp;Nov. 2004 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dec. 2004 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Jan. 2005 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Feb. 2005 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></B></P>
<P style="margin:0pt; padding-left:288pt; text-indent:-216pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-10pt; padding-left:288pt; text-indent:-252pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">&nbsp;Closing &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2616 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2180 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1860 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2020 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2412</font></P>
<P style="margin-top:0pt; margin-bottom:-10pt; padding-left:288pt; text-indent:36pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
1.2335</font></P>
<P style="margin:0pt; padding-left:288pt; text-indent:108pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
<P style="margin:0pt; padding-left:288pt; text-indent:-252pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-10pt; padding-left:288pt; text-indent:-252pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Average &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2878 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2469 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1961 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2191 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2253</font></P>
<P style="margin:0pt; padding-left:288pt; text-indent:36pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
1.2397</font></P>
<P style="margin:0pt; padding-left:288pt; text-indent:-252pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-10pt; padding-left:288pt; text-indent:-252pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Hi &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3069 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2727 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2243 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2414 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2412</font></P>
<P style="margin:0pt; padding-left:288pt; text-indent:36pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
1.2584</font></P>
<P style="margin:0pt; padding-left:288pt; text-indent:-252pt; font-family:Times New Roman; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-10pt; padding-left:288pt; text-indent:-252pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">Low &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2616 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2180 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1759 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1837 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2003</font></P>
<P style="margin:0pt; padding-left:288pt; text-indent:36pt; line-height:10pt; font-family:Times New Roman; font-size:8pt"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
1.2314</font></P>
<font face="Arial">
<BR>
<BR>
<BR></font>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman"><B><font face="Arial">B.</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman"><font face="Arial"><B>Capitalization and indebtedness</B>.</font></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman"><font face="Arial">Not required as this is an &#147;annual report under the Exchange Act&quot;</font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman"><B><font face="Arial">C.</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman"><B><font face="Arial">Reason for the offer and use of proceeds</font></B></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman"><font face="Arial">Not required as this is an &#147;annual
report under the Exchange Act&quot;</font></P>
<P style="margin:0pt; text-indent:72pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman"><B><font face="Arial">D.</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman"><B><font face="Arial">Risk Factors</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><font face="Arial">An investment in the securities involves a high degree of risk. &nbsp;Investors need to carefully consider the following risk factors, in addition to the other information contained in this section &#147;C&#148; and the Exhibits hereto.</font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><B><font face="Arial">Industry Competition</font></B></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">The mining industry is a highly diverse and competitive international business. &nbsp;The selection of geographic areas of interest are only limited by the degree of risk a company is willing to accept by the acquisition of &nbsp;properties in emerging or developed markets and/or prospecting in explored or virgin territory. &nbsp;Mining by its nature, is a competitive business with the search for fresh ground with good exploration potential and the raising of the requisite capital to move projects forward to production. &nbsp;Globally the mining industry is prone to cyclical variations in the price of the commodities produced by it, as dictated by supply and demand factors, speculative factors and industry-controlled marketing cartels. &nbsp;Nature provides the ultimate uncertainty with geological and occasionally climatic surprises. Commensurate with the acceptance of this risk profile is the potential for high rewards.</fon
t></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><B><font face="Arial">Exploration and Development</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<ul>
  <li>
    <p style="margin:0pt; font-family:Times New Roman" align="justify"><font face="Arial">The exploration, and development of, and the production from mineral deposits is potentially subject to a number of political, economic and other risks. &nbsp;Exploration, development and production activities are potentially subject to political, economic and other risks, including:</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">cancellation or renegotiation of contracts;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">changes in local and foreign laws and regulations;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">changes in tax laws;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">delays or refusal in granting prospecting permissions, mining authorizations and work permits for foreign management staff;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">environmental controls and permitting</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">expropriation or nationalization of property or assets;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">foreign exchange controls;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">government mandated social expenditures, such as comprehensive health care for HIV/AIDS infected employees and families;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">import and export regulation, including restrictions on the sale of their production in foreign currencies;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">industrial relations and the associated stability thereof;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">inflation of cost that is not compensated for by a currency devaluation;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">requirement that a foreign subsidiary or operating unit have a domestic joint venture partner, possibly which the foreign company must subsidize;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">restrictions on the ability of local operating companies to sell their production for foreign currencies, and on the ability of such companies to hold these foreign currencies in offshore and/or local bank accounts;</font></li>
</ul>
<font face="Arial">
<BR>
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR>
<BR>
</font></P>
<ul>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">restrictions on the ability of a foreign company to have management control of exploration and/or development and/or mining operations;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">restrictions on the remittance of dividend and interest payments offshore;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">retroactive tax or royalty claims;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">risks of loss due to civil strife, acts of war, guerrilla activities, insurrection and terrorism;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">royalties and tax increases or claims by governmental entities;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">unreliable local infrastructure and services such as power, communications and transport links;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Symbol" align="justify"><font face="Arial">other risks arising out of foreign sovereignty over the areas in which Caledonia&#146;s operations are conducted.</font></li>
</ul>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">Such risks could potentially arise in any country in which Caledonia operates; however the risks are regarded as greater in South Africa and Zambia. &nbsp;In South Africa, the Black Economic Empowerment Legislation and a number of economic and social issues may result in an increased perceived political and economic risk weighting of operating in that country.</font> </P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">Consequently, Caledonia&#146;s exploration, development and production activities may be substantially affected by factors beyond Caledonia&#146;s control, any of which could materially adversely affect Caledonia&#146;s financial position or results from operations. Furthermore, in the event of a dispute arising from such activities, Caledonia may be subject to exclusive jurisdiction of courts outside North America or may not be successful in subjecting persons to the jurisdiction of the courts in North America, which could adversely affect the outcome of a dispute.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><B><font face="Arial">History of Losses; Accumulated Deficit; No Assurance of Revenue or Operating Profit</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">Since inception from February 1992, Caledonia has recorded a loss in every year except 1994 and 2000. &nbsp;As at December 31, 2004 the consolidated accumulated deficit was $151.9 million<B>. </B>&nbsp;72.9% of the accumulated loss relates to capital asset and mineral property write-downs, 7.2% is due to discontinued operations prior to 1998, and the balance of 19.9% relates to operational and administration activity<FONT COLOR=#FF0000>.</FONT> &nbsp;Operational activity is defined as gross profit from mining operations less expenses such as amortization, general and administration, interest on debt and other miscellaneous expenses.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">Write-downs on capital assets and mineral properties are typical for the mining industry. &nbsp;Caledonia&#146;s &nbsp;&nbsp;policy is to review the carrying value of assets relative to current market conditions on an annual basis. &nbsp;In 1997, Caledonia reduced the carrying value of its investment in the two South African gold mines by recording a write-down of $44.9 million. This reduction was made in response to a decline in the average price of gold per ounce from about US$364 in 1996 to US$327 in 1997 and the placing of the two mines onto &quot;care and maintenance&quot;. &nbsp;Similarly in 1998 and 1999 these assets were further reduced by $10.6 million and $2.4 million respectively when the gold price fell to about US$ 250 per oz. In 2004, the mineral property of Eersteling Gold Mine was written down by $223,000 to $0. &nbsp;Similarly, in 2004 the Eersteling plant and equipment was written down from $1.596 million to
 $ 0.887 million at the year end.</font> </P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">During &nbsp;2003 the Rand price of gold held steady at between R82,000 and R88,000 per kilogram despite a slow but gradual increase in the price of gold to about &nbsp;US $415 per ounce at the 2003 year end from a price of $347 per ounce at the beginning of 2003. As the gold price recovers to acceptable levels and the South African mines recommence production, a substantial portion of the write-down could be recovered as earnings. &nbsp;However, there is no assurance the Rand price of gold will be sustainable. &nbsp;During 2004, despite the gold price in US dollars increasing to a high of $458, the price of gold in South African Rands at the end of the year declined by about 9.5% over that at the end of 2003. The Rand appreciated by 14.8% against the US$ over the 2004 year whilst the US$ gold price increased by about 6.6% over the year.</font> </P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">In 2002, the carrying value of Caledonia&#146;s Kadola exploration property in Zambia, amounting to $2.6 million was written down to $1 as no exploration funding was available for this project at that time. In 2003, the carrying value of the Nama group exploration property in Zambia, $9,534,000, was written down to $1 due to lack of significant exploration activity on the property during the year and despite there being strong interest shown on purchasing a cobalt concentrate from Nama by two potential end-users. &nbsp;In 2004, development work was re-started on the Nama cobalt project due to increases in the prices of base metals and the continuing strength of the price of cobalt.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">At the end of 2004, an amount of $1.671 million had been spent on exploration of the Rooipoort Platinum Project</font> </P>
<font face="Arial">
<BR>
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
<BR>
</font>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">and the Roodepoort Gold Project and had been capitalized under Canadian GAAP in the books of the Corporation. Of the above $1.671 million, $520,000 was spent in 2003 and the balance was spent in 2004.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">In general, mining companies react to changing commodity prices by searching for new methods of operating to either increase the volume of production from existing ore reserves or reduce operating costs. &nbsp;Caledonia is continuously searching for new production methods and operating cost efficiencies in an attempt to mitigate the effects of lower commodity prices on operating profits. However, there is no guarantee that Caledonia &nbsp;will be successful in its efforts. &nbsp;Caledonia at its Barbrook mine &nbsp;recommenced gold production in the 2<SUP>nd</SUP> quarter of 2003 &nbsp;and introduced the relatively new technology of Resin leaching to increase its gold recovery and enhance economics. In late 2003 and during 2004 Caledonia introduced additional new flotation equipment and concentrate oxidation technology at Barbrook to further improve the gold recovery and production economics. It is further evaluating alternat
ive metallurgical processes to determine whether further improvements in recoveries and mine economics can be attained.</font> </P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><B><font face="Arial">Need for Additional Funds</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">It is the belief of &nbsp;Caledonia &nbsp;that the &nbsp;financing by a group of private investors that &nbsp;closed on the 30<SUP>th</SUP> June 2004 and which provided gross funding of &nbsp;about $15.0 million and the exercise of common share purchase warrants of about &nbsp;$ 0.761 million will sustain &nbsp;Caledonia &nbsp;for the year 2005. The resumption of gold production at Caledonia&#146;s Barbrook mine also generated some cash flow in 2004 and will continue in 2005. However, if funds fall short of requirements, Caledonia &nbsp;will undertake financing options such as private placements with private investors, and, if this is still insufficient for its needs, will investigate either project joint ventures or project or bank funding. &nbsp;&nbsp;The funds raised by the 2004 financing have been and will be mainly used by Caledonia on its exploration, development and production activities such as:</font></P>
<ul>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Symbol" align="justify"><font face="Arial">at Barbrook by developing access to ore resources below the 10 level and to the east along strike; providing continuity of the mining operations; making capital additions to the Barbrook metallurgical plant, such as a Biox&#174; circuit and/or ultra-fine milling;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Symbol" align="justify"><font face="Arial">by further drilling at Caledonia&#146;s Rooipoort Platinum Project;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Symbol" align="justify"><font face="Arial">by the purchase of additional exploration property at Caledonia&#146;s Grasvally Platinum Project;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Symbol" align="justify"><font face="Arial">drilling of Caledonia&#146;s Grasvally project once the Prospecting permit has been issued;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Symbol" align="justify"><font face="Arial">by further &nbsp;bulk sampling and concentration testwork on Caledonia&#146;s Nama Cobalt/Copper Project in Zambia;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Symbol" align="justify"><font face="Arial">by further exploration and drilling at the Roodepoort gold project of
    Eersteling;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Symbol" align="justify"><font face="Arial">by possible drilling of target exploration areas at Eersteling gold mine; and</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Symbol" align="justify"><font face="Arial">by further drilling/bulk sampling and processing of material from the Goedgevonden Diamond project.</font></li>
</ul>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">. &nbsp;The Mulonga Plains Joint Venture with the BHP-Billiton Entity is subject to joint venture agreements and is fully funded by the joint venture partner through to commercial production. Similarly, the Kikerk Lake joint venture with Ashton Mining (Canada) Limited is fully funded by Ashton. Caledonia continues to actively review the benefits, to Caledonia and its shareholders, of seeking joint venture partners for most, if not all of its exploration properties.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><B><font face="Arial">Dependence upon Key Personnel</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">Caledonia&#146;s success depends (i) on the continued contributions of its directors, executive officers, management and consultants, and (ii) on Caledonia&#146;s ability to attract new personnel whenever Caledonia &nbsp;seeks to implement its business strategy. &nbsp;During &nbsp;Caledonia &#146;s limited operating history and the continuous shortage of funding between 1997 and mid 2002, most of the key responsibilities within &nbsp;Caledonia &nbsp;have been assigned to a small number of individuals. With &nbsp;recommencement of production at &nbsp;the Barbrook mine and the expansion of other Southern African projects, various consultants and staff have been engaged to assist with the increased technical and administrative workload. &nbsp;In late 2003 and early 2004 additions were made to the corporate staff at senior levels to strengthen the management and operations team in South Africa and to address some of the successio
n planning needs of Caledonia.;</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">To follow on from the previously disclosed appointments, &nbsp;Mr. Mike Tombs as was appointed Vice President Finance and Chief Financial Officer at mid year, and Mr. Roland Fasel of Geneva, Switzerland was appointed to the Board of Directors in August 2004. Mr. Rupert Pardoe of Johannesburg, South Africa was appointed as Chairman of the Board of Directors of the Corporation in February 2005. Mr. Hayden stepped down as the Chairman at that time</font> </P>
<font face="Arial">
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</font>
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<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
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<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">but continues as the Corporation&#146;s President and CEO.</font> </P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><B><font face="Arial">Absence of Dividends</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">The Company has never paid, and does not intend at this stage, to declare or pay cash dividends on Common Stock in the foreseeable future.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><B><font face="Arial">Possible Volatility of Share Price</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">Market prices for mining company securities, by their nature, &nbsp;are volatile. &nbsp;Factors, such as rapidly changing commodity prices, political unrest globally and in countries where &nbsp;Caledonia &nbsp;operates, speculative interest in mining stocks etc. are but a few factors affecting the volatility of the share price. &nbsp;The volatility of Caledonia&#146;s &nbsp;stock may also be affected by the relative lack of institutional and stock analyst coverage of &nbsp;Caledonia . However, Caledonia intends to list its shares on the London Stock Exchange&#146;s &nbsp;Alternative Investment Market (&#147;AIM&#148;) in 2005 and to try to attract more institutional and stock analyst coverage of its shares.</font></P>
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<P style="margin:0pt; padding-left:36pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=justify><B><font face="Arial">INFORMATION ON THE COMPANY</font></B></P>
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<P style="margin:0pt; padding-left:45pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=justify><B><font face="Arial">History and Development ofCaledonia</font> </B></P>
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<P style="margin:0pt; padding-left:42.55pt; font-family:Times New Roman" align=justify><font face="Arial"><B>Caledonia Mining Corporation</B> (&quot;Caledonia&quot;) was incorporated, effective February 05, 1992, by the amalgamation pursuant to the laws of the Province of British Columbia, Canada of two &quot;public&quot; companies and one &quot;private&quot; company. &nbsp;The two public companies were Golden North Resource Corporation (&quot;Golden North&quot;), a British Columbia company and Thorco Resources Inc. (&quot;Thorco&quot;), an Ontario company. &nbsp;The private company was Doelcam Mining Corporation (&quot;Doelcam&quot;), an Ontario company. &nbsp;Such three companies being herein variously referred to as the &quot;Amalgamating Companies&quot;.</font></P>
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<P style="margin:0pt; padding-left:42.55pt; font-family:Times New Roman" align=justify><font face="Arial">One of the Amalgamating Companies, Golden North was itself created, effective October 1, 1986 by the amalgamation, pursuant to the laws of the Province of British Columbia, Canada, of two &quot;public&quot; British Columbia companies named Golden North Resource Corporation (&quot;Golden North&quot;) and Good Hope Resources Ltd. (&quot;Good Hope&quot;) - such two companies being herein variously referred to as the &quot;Predecessor Companies&quot;. &nbsp;Predecessor Corporation Golden North was itself created by an amalgamation, which became effective on August 30, 1984, of three companies incorporated in the Province of British Columbia, Canada, named Grove Explorations Ltd., Rosmac Resources Ltd. and N.W.P. Resources Ltd.</font></P>
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<P style="margin:0pt; padding-left:42.55pt; font-family:Times New Roman" align=justify><font face="Arial">The amalgamation of companies under the British Columbia Corporation Act is in effect a merger of the Amalgamating Companies into a single new corporate entity, which replaces the original Amalgamating Companies. &nbsp;As a result of the amalgamation, Caledonia became possessed of all the assets and assumed responsibility for all of the liabilities, of the Amalgamating Companies.</font></P>
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<P style="margin:0pt; padding-left:42.55pt; font-family:Times New Roman" align=justify><font face="Arial">As a result of the amalgamation, all of the issued and outstanding shares of the Amalgamating Companies were exchanged for fully paid and non-assessable common shares in the capital of Caledonia. &nbsp;As a result of the share exchange Caledonia issued a total of 10,632,567 common shares to the shareholders of the Amalgamating Companies. &nbsp;The share exchange was on the following basis:</font></P>
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<P style="margin:0pt; padding-left:134.7pt; font-family:Times New Roman" align=justify><font face="Arial">- &nbsp;0.71672 shares of Caledonia for one share of Golden North;</font></P>
<P style="margin:0pt; padding-left:134.7pt; font-family:Times New Roman" align=justify><font face="Arial">- &nbsp;0.19426 shares of Caledonia for one share of Thorco;</font></P>
<P style="margin:0pt; padding-left:134.7pt; font-family:Times New Roman" align=justify><font face="Arial">- &nbsp;0.70810 shares of Caledonia for one share of Doelcam</font></P>
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<P style="margin:0pt; padding-left:42.55pt; font-family:Times New Roman" align=justify><font face="Arial">The shares of Golden North and Thorco were, prior to the amalgamation, listed on the Toronto Stock Exchange in Toronto Ontario, Canada. &nbsp;Additionally, up to 1991, Golden North was listed on the Vancouver Stock Exchange in Vancouver British Columbia, Canada and was also quoted on NASDAQ in the U.S.A. &nbsp;Following the amalgamation, the shares of Caledonia were listed for trading on the Toronto Stock Exchange and quoted on the NASDAQ small caps market. &nbsp;In October 1995, Caledonia was elevated to the NASDAQ National Market from the small caps market.</font></P>
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<P style="margin:0pt; padding-left:42.55pt; font-family:Times New Roman" align=justify><font face="Arial">In March 1995, Caledonia decided to de-register as a Corporation registered under the laws of the</font> </P>
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<P style="margin:0pt; padding-left:42.55pt; font-family:Times New Roman" align=justify><font face="Arial">Province of British Columbia, and simultaneously, was registered as a Canadian Corporation under the provisions of the Canadian Business Corporations Act<I> </I>(CBCA).</font></P>
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<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;The addresses and telephone numbers of Caledonia&#146;s two principal offices are:</font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:42.55pt; font-family:Times New Roman" align=justify><B><font face="Arial">Head Office - Canada</font></B></P>
<B><P style="margin:0pt; padding-left:42.55pt; text-indent:173.45pt; font-family:Times New Roman" align=justify><font face="Arial">Africa Office - South Africa</font></B></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:42.55pt; font-family:Times New Roman" align=justify><font face="Arial">Caledonia Mining Corporation</font></P>
<P style="margin:0pt; padding-left:42.55pt; text-indent:173.45pt; font-family:Times New Roman" align=justify><font face="Arial">Greenstone Management Services</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:42.55pt; font-family:Times New Roman" align=justify><font face="Arial">Suite 9, 2145, Dunwin Drive,</font></P>
<P style="margin:0pt; padding-left:42.55pt; text-indent:173.45pt; font-family:Times New Roman" align=justify><font face="Arial">24, 9th Street, Lower Houghton</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:42.55pt; font-family:Times New Roman" align=justify><font face="Arial">Mississauga, L5L 4L9</font></P>
<P style="margin:0pt; padding-left:42.55pt; text-indent:173.45pt; font-family:Times New Roman" align=justify><font face="Arial">Johannesburg, Gauteng, 2198</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:42.55pt; font-family:Times New Roman" align=justify><font face="Arial">Ontario, Canada</font></P>
<P style="margin:0pt; padding-left:42.55pt; text-indent:173.45pt; font-family:Times New Roman" align=justify><font face="Arial">South Africa</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:42.55pt; font-family:Times New Roman" align=justify><font face="Arial">(1) 905 607 7543</font></P>
<P style="margin:0pt; padding-left:42.55pt; text-indent:173.45pt; font-family:Times New Roman" align=justify><font face="Arial">(27) 11 447 2499</font></P>
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<P style="margin:0pt; padding-left:21.3pt; font-family:Times New Roman" align=justify><font face="Arial">The above principal Canadian and South African office addresses are the same as those given in the 2002 and the 2003 Form 20F.</font></P>
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<P style="margin:0pt; padding-left:21.3pt; font-family:Times New Roman" align=justify><font face="Arial">In 1997, the NASDAQ stock market put Caledonia on notice that new listing requirements were in the process of being implemented. A minimum bid price of US$1.00 per share for a period of ten consecutive trade days is required for Caledonia to regain compliance with the new listing requirements. &nbsp;Caledonia was unable to regain compliance and on October 16<SUP>th</SUP> 1998, Caledonia announced that the NASDAQ Stock Market, Inc. would no longer quote Caledonia&#146;s securities for trading. &nbsp;In addition to trading on the Toronto Stock Exchange, Caledonia&#146;s common stock commenced trading on NASDAQ&#146;s OTC Bulletin Board system under the same symbol, CALVF, immediately after removal from the NASDAQ National Market.</font></P>
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<P style="margin:0pt; padding-left:21.3pt; font-family:Times New Roman" align=justify><font face="Arial">On April 6, 2000, the Board of Directors of Caledonia approved a letter of intent dated April 4, 2000 whereby Caledonia disposed of its investment in Filon Sur S.A. (&quot;Filon Sur&quot;) and Fynegold Exploration Limited (&quot;Fynegold&quot;). &nbsp;In relation to the above transaction, reference is made to note 5 (b) of Caledonia&#146;s financial statements contained in the 2000 Annual Report, which information was incorporated therein by reference in the 2000 Form 20F.</font> </P>
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<P style="margin:0pt; padding-left:21.3pt; font-family:Times New Roman" align=justify><font face="Arial">In August 2000, Caledonia was notified by its joint venture partner on its Mulonga Plain properties in Zambia that it had expended more than US$ 3 million on exploration on the properties and as such had earned a 60% interest in that property. &nbsp;The joint venture party has continued work on the Mulonga Plain properties in 2004 in its search for diamondiferous kimberlite pipes and has planned further exploration work for the 2005 exploration season.</font></P>
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<P style="margin:0pt; padding-left:21.3pt; font-family:Times New Roman" align=justify><font face="Arial">In August 2000, Caledonia concluded a deal with a major mining company whereby the company would &nbsp;&nbsp;spend a total of $750,000 over a 3-year period on Caledonia&#146;s Kikerk Lake diamond property in northern Canada to earn a 52.5% interest in the property from Caledonia who at that time held a 70% interest.<B> &nbsp;</B>By the end of 2002 the mining group had spent in excess of $750,000 on the Kikerk property and had earned a 52.5% interest. &nbsp;The joint venture parties have signed a 3-way joint venture exploration agreement in early 2002 and the operator of the joint venture has completed an approximate $1.5 million winter and summer exploration program in 2002 a further $600,000 program in 2003 and a $300,000 exploration program in 2004. At the date of this report, the operator had not set a cost of its 2005 program of exploration expenditure.</font></P>
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<P style="margin:0pt; padding-left:21.3pt; font-family:Times New Roman" align=justify><font face="Arial">In August 2000, Caledonia signed a heads of agreement with a major mining group over Caledonia&#146;s Nama group licences in Zambia &#150; the &#147;Kalimba project&#148;. &nbsp;The mining group undertook to spend US$ 2,500,000 over a 4-year period to earn a 30% interest in the property by funding all of the exploration work on the Kalimba project. &nbsp;The mining group could have increased its interest to 50% by spending a further $4,000,000 in the same 4-year period. &nbsp;The mining group carried out exploration work on the Kalimba project between 2000 and March 2002 when it withdrew from the joint venture as part of its overall cutback in worldwide exploration. &nbsp;The property is again fully owned by Caledonia. &nbsp;Talks were held with another potential joint venture partner in 2002 but without any agreement being reached. &nbsp;In late 2003 talks were held with a smelting company in Zambia rega
rding the sale of concentrates from Nama as smelter feed. Further discussions with the Zambian Smelter and other cobalt end-users were held in 2004. &nbsp;Caledonia collected a 10-tonne bulk sample from Nama during the<SUP> </SUP>3rd quarter of 2004 and conducted</font> </P>
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<P style="margin:0pt; padding-left:21.3pt; font-family:Times New Roman" align=justify><font face="Arial">metallurgical tests to produce a concentrate and confirm whether or not the specifications required by the smelter can be met. The tests continued into the 1<SUP>st</SUP> quarter of 2005.</font></P>
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<P style="margin:0pt; padding-left:21.3pt; font-family:Times New Roman" align=justify><font face="Arial">Caledonia has not been involved in any significant reorganization, mergers, receiverships or bankruptcies. However in January 2002, Caledonia&#146;s management service agreement with the Filon Sur Gold Mine in Southern Spain was effectively terminated due to the placing of Filon Sur into liquidation by its major shareholder.</font></P>
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<P style="margin:0pt; padding-left:21.3pt; font-family:Times New Roman" align=justify><font face="Arial">In 2002, the Corporation<B> </B>raised about $ 4.2 million equity financing (net of fees) from private placements and a convertible debenture and about $1.5 million from the exercise of warrants. In early 2003, Caledonia raised approximately $1.2 million from equity financing (net of fees) from the portion of the private placement carried over from December 2002, about $1.2 million from the exercise of warrants and about $0.037 million from the exercise of share options. A second private placement in August 2003 raised a further $4.6 million (net of fees). For details of these equity financings and the sale of the warrants please refer to Note 4 of the Financial Statements on pages 31 and 32 of the 2003 Annual Report that are incorporated herein by reference or in Note 4 b (1), (3), (4) and (5) of the 2004 Annual Report that is incorporated as Exhibit 14a herein by reference.</font></P>
<P style="margin:0pt; padding-left:21.3pt; font-family:Times New Roman" align=justify><font face="Arial">In 2004 a private placement and exercise of warrants raised $14.3 million net of financing costs. For details of this financing please refer to Note 4 b (6) of the Financial Statements on page 34 of the 2004 Annual Report that is incorporated as Exhibit 14a herein by reference.</font></P>
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<P style="margin:0pt; padding-left:21.3pt; font-family:Times New Roman" align=justify><font face="Arial">A full description of Caledonia's involvement in its various subsidiaries is given in the following section - 4 (B). &nbsp;From time to time Caledonia receives mineral property and business proposals from third parties for review as potential investment opportunities. &nbsp;The Board of Directors or the officers of Caledonia will review and evaluate those opportunities of merit and interest to Caledonia. &nbsp;In 2002 Caledonia became involved with the &#147;Rooipoort&#148; mineral exploration property in South Africa following the review procedure outlined above.</font></P>
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<P style="margin:0pt; padding-left:21.3pt; font-family:Times New Roman" align=justify><font face="Arial">With the imminent potential of improved political conditions in other Southern African countries, Caledonia is reviewing mining opportunities in these countries. &nbsp;These activities are and will be undertaken through joint ventures or direct exploration expenditures.</font></P>
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<P style="margin:0pt; padding-left:27pt; text-indent:-5.7pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=justify><font face="Arial"><B>Mining and Exploration Properties:</B></font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:27pt; text-indent:-5.7pt; font-family:Times New Roman" align=justify><B><font face="Arial">(1)</font></B></P>
<P style="margin:0pt; padding-left:27pt; text-indent:22.65pt; font-family:Times New Roman" align=justify><B><font face="Arial">Filon Sur gold mine</font></B></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">Until June 30 2000, Caledonia owned a 99.5% interest in the Filon Sur gold mine located at Tharsis in the Province of Huelva in the Andalusia area of southern Spain. &nbsp;The Filon Sur mine had the right to mine, reclaim and process all gossans and morrongo ores from the 10,000 acre Tharsis and La Zarza lands and mining concessions, historic mining districts located on the world famous Iberian pyrite belt.</font></P>
<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">The operation at the mine in early 2001 and the latter part of the year was severely affected by wet weather that affected all of the feed sources to the plant and reduced production significantly. &nbsp;Despite various efforts to reduce costs and increase production, operating losses were made throughout the year - especially from August 2001 onwards. &nbsp;Despite seeking respite from the critical cash flow shortage by attempting to obtain Government funding for the depressed Spanish mining industry, the mine could not produce a viable on-going operating plan and was placed into liquidation at a shareholders&#146; meeting in January 2002. &nbsp;This effectively terminated the management services contract with the mine. Because of the poor operating and economic results, there was no free cash from the mine in 2001 and therefore no fees were paid to Caledonia for management services.</font></P>
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<P style="margin:0pt; padding-left:21.3pt; text-indent:28.35pt; font-family:Times New Roman" align=justify><B><font face="Arial">Barbrook gold mine</font></B></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">The 100% owned Barbrook gold mine is located near the town of Barberton in the Mpumalanga province of the Republic of South Africa. Pretoria and Johannesburg are approximately 375 km to the west. Barberton is the natural and historic center of the gold mining district in the Mpumalanga province. &nbsp;The town has a history of mining dating back more than 100 years. The present property, which covers an area of 10,625 acres and extends for a distance of about 28 km along strike, represents a consolidation of about 20 old mines.</font></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">The Barbrook gold deposits occur in the Barberton Greenstone belt, the host for the other gold deposits in the area. The belt is of Achaean age and includes some of the oldest volcanic and sedimentary rocks in South Africa. &nbsp;The belt trends southwest to the northeast and has been intruded and deformed by various granite plutons at the margins. The Barbrook property covers two steeply dipping banded iron formations oriented in an east-west direction. &nbsp;These two shear zones, called the Zwartkoppie and Barbrook Lines are the host to the Barbrook gold deposits.</font></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">During 1997, prior to the suspension of activities, the mine was operating at a rate of 17,000 tonnes per month and the process plant was operating at about 20,000 tonnes per month of underground ore. &nbsp;The plant has, in the past, processed oxide ore at rates in excess of 30,000 tonnes per month. Through 2000, operations remained suspended at Barbrook due to the continuing low gold price. &nbsp;The underground mine was operated on a very small-scale basis in early-mid 2001 to generate cash flow to enable the plant and the mine to be re-started. &nbsp;This operation was terminated in September 2001 due to uneconomic operation at the low production rate. The mine was returned to a care and maintenance basis. Reference is made to page<B> 7</B> of the 2004 Annual Report for information on the reserves and resources, which information is incorporated herein by reference.</font></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">Barbrook was re-started in January 2002, again mining a low-tonnage, high grade payshoot to provide cash flow to commence rehabilitation of the Mine planned to re-start processing at a rate of 6,000 tonnes per month and to pilot test the new process technology for gold recovery developed by Caledonia. However, due to poor economic returns on the low tonnage, high-grade ore, operations were suspended in April 2002. A full geological and mining re-evaluation was carried out on the Taylor&#146;s orebody from May 2002, which has led to the rehabilitation of the mine and plant and the resumption of operations in the 2<SUP>nd</SUP> quarter of 2003. Information on the production of Barbrook in 2004 is shown on Page 10 of the 2004 Annual Report that is incorporated herein by reference. The characteristics of the Taylors ore fed to the plant in 2003 and 2004 were not as expected, or as used in earlier test work, 
and recoveries have been below projections. &nbsp;The ore was much more refractory with considerably more arsenopyritic ore than expected, although these ores are of higher grade than the pyritic ore zones tested previously.</font></P>
<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">A number of alternative metallurgical circuits have been tested and circuit improvements have been identified. &nbsp;In late 2003 and during 2004 Caledonia introduced new flotation equipment, organic carbon separation systems and concentrate oxidation technology at Barbrook to improve the gold recovery and therefore the production economics. Commissioning and modifying these circuit changes is continuing. &nbsp;In early 2005, Barbrook is further evaluating &#147;dense-media-separation&#148;, &#145;ultra-fine milling&#146; and &#145;whole-plant Biox&#174;&#146; metallurgical processes to determine whether further recovery improvements and improved economics can be attained. Further information on the detailed work carried out in the Barbrook metallurgical plant is shown on pages 10, 11 and 12 of the 2004 Annual Report that is incorporated herein by reference.</font></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">As future test work is completed, and following an internal, feasibility study, it is probable that more revisions to the metallurgical plant can be expected.</font> </P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">In 2004 it was decided to develop mining operations at Taylors on the Barbrook line below the 10 level, at the upper levels of Taylors and easterly along strike towards the Crescent area and on the Zwartkoppies line in order to provide additional ore to the metallurgical plant when the new metallurgical processes are proven successful. Development of an incline shaft to access these levels was started in 2004. &nbsp;A hoist has been purchased and will be installed and commissioned during 2005. Further information on exploration and mining at Barbrook is shown on pages 6, 7</font> </P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">and 10 of the 2004 Annual Report that is incorporated herein by reference.</font></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><B><font face="Arial">Eersteling gold mine</font></B></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">The 100% owned Eersteling gold mine, is located 36 kilometers from the town of Polokwane (Pietersburg) in the rolling terrain of the Northern Province of the Republic of South Africa. &nbsp;Pretoria and Johannesburg are 250 km and 300 km, respectively, to the south.</font></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">The first gold discovered in South Africa was on a farm named &quot;Eersteling&quot; which was located near the village of Marabastad, 30 km southeast of Pietersburg. &nbsp;Mining started in May 1874 and continued until the second Anglo-Boer War (1899 - 1902) when the mine was shut down. The mining rights of the fragmented mining and exploration properties were consolidated. On July 16 1987, Eersteling Gold Mining Company Limited was formed and was listed on the Johannesburg Stock Exchange.</font></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">The Eersteling Mine property has an area of 47,000 acres (19,000 hectares), extends for a distance of about 25 km and is located in the Pietersburg Greenstone belt which is of Achaean age and which consists of an upper and lower sequence. &nbsp;The upper sequence is mainly conglomerate, grit and sandstone. The lower sequence is undifferentiated mafic and ultramafic volcanic rocks and intrusives, with banded iron formation and chert. &nbsp;The feature that most dominates gold mineralization in the area is the Willemse shear. &nbsp;During 2003 and 2004 operations remained suspended at Eersteling.</font> </P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Courier" align=justify><font face="Arial">A
full geological review of the Eersteling property, including the mine plans and other technical data, was commenced in October 2004. &nbsp;The resources at Eersteling were evaluated and a development program prioritized. Other prospective areas, which should be investigated as potential ore sources, were identified and a surface exploration program has been proposed to test some of these areas. &nbsp;This program of work included a high resolution aeromagnetic survey which was completed in January 2005 and will be combined with results of previous work as well as a detail gold-in-soil sampling survey over the property that is currently nearing completion. Following the above survey and sampling program, and depending on the results attained, potential target zones will be identified that may lead to possible drilling in 2005.</font></P>
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<P style="margin:0pt; padding-left:49.65pt; text-indent:22.35pt; font-family:Times New Roman" align=justify><font face="Arial"><B><I>Platinum/Base-metals Properties:</I></B> &nbsp;In 2002, Eersteling obtained the Rooipoort platinum prospect from Anglo American Platinum Corporation (Amplats). The property is about 30 km southwest of the Eersteling metallurgical plant and is located in an area that is presently undergoing a surge in platinum group metal exploration. &nbsp;In the third quarter of 2003 a stratigraphic exploration-drilling program was commenced on the Rooipoort property and continued into 2004. &nbsp;Exploration drilling to define a reserve/resource is continuing in 2005 concentrating on the extreme southern and northern areas of the Rooipoort license area where the platinum group metals/gold/base copper and nickel metals mineralization seems to be closer to surface.</font></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman"><font face="Arial">Initial exploration results indicate that there is PGM and base metal (nickel and copper) mineralization in most of the holes drilled to date over a 6 km strike length. A provisional interpretation of the drill results indicates that the northern and extreme southern portions of the Rooipoort property are most prospective for mineralization at even shallower depths. Future exploration activity will be concentrated in these areas and in the Grasvally property following receipt of the prospecting permit.</font></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman"><font face="Arial">At the end of 2004, flotation amenability test work was performed at the SGS Lakefield laboratories in Johannesburg, South Africa on mineralized composite samples from 5 lithological units prepared from the diamond drill-hole cores to verify the flotation amenability of the ore. The tests included milling and basic flotation to produce a flotation concentrate. The tests indicated that from each of the 5 mineralized zones, a re-cleaner flotation concentrate of low mass recovery can be produced that contains medium to high recovery of the platinum, palladium, gold, copper and nickel. This initial test work indicates that a simple metallurgical process route could process a</font> </P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">Following upon the successful 2003/2004 drilling, a further 342 hectares of prospecting rights were purchased in the Grasvally area contiguous to the southern boundary of Rooipoort. A prospecting permit covering the Grasvally property was applied for during April 2004. However, in early March 2005 the Corporation was notified by the South African Department of Mines and Energy that its application had been refused on the grounds only of not having a shareholder&#146;s agreement in place with a black economic empowerment partner. The Corporation believes that this refusal has no basis in South African law and continues to actively pursue this permit by all available means. Exploration work in the Grasvally area will commence immediately once the necessary exploration permits are received by the Corporation from the South African Department of Mines and Energy.</font></P>
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<P style="margin:0pt; padding-left:49.65pt; text-indent:22.35pt; font-family:Times New Roman" align=justify><font face="Arial"><B><I>Gold Exploration Properties:</I></B> In 2003, Eersteling identified a near-surface gold exploration prospect (&#147;Roodepoort&#148;). In 2004, Eersteling tested this Roodepoort gold property, located 22 km north east of the Eersteling mine area and 8 km east of the Zandrivier mine area. Roodepoort is situated on an area of historical gold mining and an unusual gold-bearing albitite intrusive (a hydrothermally altered granodiorite). A diamond drill program, consisting of three angled (-45&#186;) core holes, was completed during September 2004. &nbsp;Although some results are interesting, the best intersections are 100m deep and are not reflected in the results from the other holes drilled. &nbsp;These intersections are believed to correspond to the down dip extension of a number of old workings to the east whose workings extended to the 30m level. Caledonia has on a further rev
iew of the drill core, concluded that the potential for an open-pit operation, based on reported gold mineralization in the albitite, as previously envisaged requires further exploration. &nbsp;Additionally the potential also exists for narrower higher grade vein mineralization on this property that will require further evaluation as a source of ore for the Eersteling metallurgical plant</font></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">Reference is made to page<B> </B>7 and 8 respectively<B> </B>of the 2004 Annual Report for information on the resources of Barbrook and Eersteling and on pages 13 and 15 respectively for a description of the Roodepoort gold and the Rooipoort/Grasvally platinum prospects, which information is incorporated herein by reference.</font> </P>
<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">Because of the poor liquidity of trading and the high costs of maintaining Eersteling Gold Mining Company Limited (&#147;Eersteling&#148;) as a listed company, Caledonia redeemed the minority shareholders and subsequently delisted Eersteling from the Johannesburg Stock Exchange (&#147;JSE&#148;) in mid-2004.</font></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><B><font face="Arial">General Comments</font></B></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">Caledonia&#146;s activities are centered in Southern and Central Africa and in Northern Canada. &nbsp;Generally, in the gold mining industry the work is not seasonable except where heavy seasonal rainfall can affect surface mining or exploration. &nbsp;Caledonia is not dependent, to any material extent, on patents, licenses, contracts, specialized equipment or new manufacturing processes at this time. &nbsp;However, there may be occasions that Caledonia may wish to adopt such patents, licenses, specialized equipment etc. if these are economically beneficial to its operations. For example, at the present time Caledonia&#146;s subsidiary, Barbrook Mines Ltd, has negotiated a license agreement with Biomin Technologies SA of Switzerland to allow Biomin&#146;s &#147;BIOX&#174;&#148; process and has purchased or hired specialized equipment such as the Kemix/Anglo American leach pump-cells, the G-Cell cleaner f
lotation cells and the Aachen high-efficiency oxygen dispersers that are currently used at the Barbrook Gold Mine. &nbsp;Additional details of the BIOX&#174; process are given on page 11 of the 2004 Annual Report which is incorporated herein by reference.</font></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">All Mining and exploration activities are conducted under the various Economic, Mining and Environmental Regulations of the country where the operations are being carried out. &nbsp;It is always Caledonia&#146;s standard that these regulations are complied with by Caledonia otherwise its activities risk being suspended.</font></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><B><font face="Arial">Exploration and Development properties</font></B></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">As in 2002 and 2003 Caledonia continued to focus its efforts in 2004 on those exploration properties with the greatest potential in Africa and in Northern Canada.<B> &nbsp;</B>In 2001, Caledonia obtained interests in the Konkola West property in Northern Zambia and the Pruissen and the Vier-en-Twintig Rivier properties in the Limpopo Province of South Africa. In 2002, Caledonia obtained a 100% interest in the Rooipoort platinum prospect, also in the Limpopo Province of South Africa. &nbsp;Due to their lower prospectivity than Caledonia&#146;s other exploration properties, the option agreements at the Pruissen and Vier-en-Twintig properties were dropped in 2002. &nbsp;In 2003 Caledonia added the Lukulu license area in Western Zambia to the Mulonga Plain Joint Venture lands. In late 2003 and early 2004 Caledonia increased its property holdings adjacent to its Rooipoort platinum project in South Africa in t
he Grasvally area more fully described in clause 3 above.</font></P>
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<P style="margin:0pt; padding-left:49.65pt; font-family:Times New Roman" align=justify><font face="Arial">Reference is made to pages 4, 5 and 6 of the 2001 Annual Report which was incorporated into the 2001 Form 20F and pages 4 to 8 inclusive of the 2002 Annual Report for historic information on Caledonia&#146;s exploration and development properties which information is incorporated herein by reference. Further information on the more current exploration and project development is shown on pages 13 to 16 of the 2004 Annual Report which information is incorporated herein by reference. &nbsp;</font></P>
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<P style="margin:0pt; padding-left:27pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=justify><B><font face="Arial">Organizational Structure - Significant Companies</font></B></P>
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<P style="margin:0pt; padding-left:-9pt; text-indent:36pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><B><font face="Arial">AFRICA:</font></B></P>
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<P style="margin:0pt; padding-left:-9pt; text-indent:36pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=justify><B><font face="Arial">Zambia:</font></B></P>
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<P style="margin:0pt; padding-left:27pt; font-family:Times New Roman" align=justify><font face="Arial">Caledonia Mining Corporation owns 100% of the shares of the following Zambian registered and incorporated companies:</font></P>
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<P style="margin:0pt; padding-left:-9pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">- Caledonia Mining (Zambia) Limited</font></P>
<P style="margin:0pt; padding-left:-9pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">- Caledonia Western Limited</font></P>
<P style="margin:0pt; padding-left:-9pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">- Caledonia Nama Limited</font></P>
<P style="margin:0pt; padding-left:-9pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">- Caledonia Kadola Limited</font></P>
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<P style="margin:0pt; padding-left:27pt; font-family:Times New Roman" align=justify><font face="Arial">These companies are collectively known as &quot;Caledonia Zambia&quot; throughout this Form 20 F. &nbsp;&nbsp;However, on the joint venture on the Mulonga Plain properties, the other parties have now obtained a 60% interest after spending in excess of US$ 3,500,000. The joint venture parties have now spent in excess of US$ 5.5 million on the Mulonga Plain joint venture property. It is intended that these properties, that are the sole assets of Caledonia Western, will be transferred to a new Zambian company in which Caledonia will hold a 40% interest.</font></P>
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<P style="margin:0pt; padding-left:36pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Caledonia Mining Corporation owns the following interests in South African registered and incorporated companies:</font></P>
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<P style="margin:0pt; padding-left:42.55pt; text-indent:-6.55pt; font-family:Times New Roman" align=justify><font face="Arial">- 100% of Eersteling Gold Mining Company Limited, a company which was delisted from the Johannesburg Stock Exchange in mid 2004 when Caledonia redeemed the minority shareholders</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><font face="Arial">- &nbsp;100% of Barbrook Mines Limited - a private South African registered company.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><font face="Arial">- &nbsp;100% of Greenstone Management Services Limited- a private South African registered company</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><font face="Arial">- &nbsp;100% of Fintona Investments (Proprietary) Ltd - a private South African registered company, and</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><font face="Arial">- &nbsp;100% of Maid O&#146;Mist (Proprietary) Limited - a private South African registered company</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The only producing area of involvement of Caledonia in 2001 was the Filon Sur Gold Mine in Spain. &nbsp;The mine produced a gold and silver product containing high amounts of copper. &nbsp;This product was sold to a refiner for further processing and the sale of precious metals. Caledonia sold Filon Sur on June 30, 2000. &nbsp;From this date, Caledonia managed Filon Sur for a fee equivalent to 30% of the excess cash flow from the mine. &nbsp;In 2000, the fee received from Filon Sur was $109,000 but in 2001, due to the severe cash flow problems, there was no management service fees received from Filon Sur. The mine has been more fully described earlier in section 4.B.1 and, as stated previously, was placed into Liquidation in January 2002 by its major shareholder.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Caledonia owns two gold assets in South Africa that were placed on &#147;care and maintenance&#148; in 1997. These are the Eersteling gold mine in Limpopo Province and the Barbrook gold mine in the Mpumalanga Province. These mines have previously been discussed in sections 4.B.2 and 4.B.3. &nbsp;Both of the mines and plants produced a dore bar product, which was sold to a South African refining company. &nbsp;Generally the gold content of the dore was in excess of 90% with silver and copper making up the other 10%. &nbsp;As discussed earlier, the Barbrook mine was rehabilitated in 2002 and early 2003 and re-commenced limited gold production during the second half of 2003 and through 2004. The Eersteling mine may be re-habilitated in 2005, dependant on exploration results from the recently completed aeromagnetic survey and soil geochem sampling program and any resultant exploration drilling program from t
he results of the survey and sampling programs and if a sustainable economic Rand price of gold prevails.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Reserve and resource estimates for the Barbrook Gold Mine and a resource estimate for the Eersteling Gold Mine are available on pages 7 and 8 of the 2004 Annual Report which information is incorporated herein by reference. &nbsp;The Barbrook reserve and resource estimates were certified by Mr. David Grant, C.Geol., FGS, Pr.Sci.Nat., an independent consultant and &#147;Independent Qualified Person&#148; as required by National Instrument 43-101 of the Canadian Securities Administrators. &nbsp;The resource estimate for the Eersteling Gold Mine is a historic resource estimate and is qualified as such on page 8 of the 2004 Annual Report which information is incorporated herein by reference.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Production results for the Barbrook Mine in 2004 are available on page 10 of the 2004 Annual Report which information is incorporated herein by reference.</font></P>
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<P style="margin:0pt; padding-left:36pt; text-indent:-14.7pt; font-family:Times New Roman" align=justify><B><font face="Arial">OPERATING AND FINANCIAL REVIEW AND PROSPECTS</font></B></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:21.3pt; text-indent:-21.3pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;<B>A</B></font></P>
<P style="margin:0pt; padding-left:21.3pt; font-family:Times New Roman" align=justify><B><font face="Arial">Operating Results</font></B></P>
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<P style="margin:0pt; padding-left:21.3pt; font-family:Times New Roman" align=justify><font face="Arial">A discussion on the &#145;Operations&#146; for 2004 is shown on pages 10 to 13 of the 2004 Annual Report of &nbsp;Caledonia under section &quot;Management Discussion and Analysis &#150; &#145;Operational Review&#146; which are incorporated herein by reference. Discussions on the &nbsp;&nbsp;&#147;Financial Results and Liquidity&#148; are shown on pages 17, 18, 19 and 20 of the 2004 Annual Report, which are incorporated herein by reference.</font></P>
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<P style="margin:0pt; padding-left:21.3pt; font-family:Times New Roman" align=justify><font face="Arial">Reference is made to pages 41 to 45 of the 2004 Annual Report GAAP reconciliation (Note 15) for the impact of the difference between Canadian and U.S. accounting principles - the Public Accounting Oversight Board (United States) on the operations of Caledonia which are incorporated herein by reference.</font></P>
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<P style="margin:0pt; padding-left:21.3pt; font-family:Times New Roman" align=justify><font face="Arial">The most critical accounting policies for Caledonia under Canadian and US GAAP are:</font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:72pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">1.</font></B></P>
<P style="margin:0pt; padding-left:72pt; text-indent:-15.3pt; font-family:Times New Roman" align=justify><B><font face="Arial">Measurement Uncertainties</font></B></P>
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<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><font face="Arial">Preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenues and expenses during the reporting period. &nbsp;The more significant areas requiring estimates relate to mineral resources, future cash flows associated with capital assets and mineral</font> </P>
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<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><font face="Arial">properties. &nbsp;Management&#146;s calculation of mineral resources and cash flows are based upon engineering and geological estimates and financial estimates including gold prices and operating costs. The amount ultimately recovered could be materially different than the estimated values.</font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-20.7pt; font-family:Times New Roman" align=justify><B><font face="Arial">2.</font></B></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><B><font face="Arial">Capital Assets</font></B></P>
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<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><B><font face="Arial">Producing Assets</font></B></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><font face="Arial">Producing assets are recorded at cost less government grants, accumulated amortization and write-downs.</font></P>
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<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><font face="Arial">Producing assets are amortized using the straight-line method based on the estimated useful lives of the assets. &nbsp;The estimated useful life of the producing assets range from 3 to 5 years. &nbsp;Repairs and maintenance expenditures are charged to operations; major improvements and replacements that extend the useful life of an asset are capitalized and amortized over the remaining useful life of that asset. &nbsp;As of December 31, 2004, Caledonia&#146;s only producing capital asset was the Barbrook gold mine in South Africa.</font></P>
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<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><B><font face="Arial">Non-Producing Assets</font></B></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><font face="Arial">Non-producing assets are recorded at cost less write-downs. &nbsp;During non-producing periods, no amortization is recorded. &nbsp;</font></P>
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<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><font face="Arial">At the time of commercial production, the assets are reclassified as producing and amortized in the manner described above.</font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-21.25pt; font-family:Times New Roman"><B><font face="Arial">3.</font></B></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman"><B><font face="Arial">Mineral Properties</font></B></P>
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<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;<B>Producing Properties</B></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><font face="Arial">When and if properties are placed in production, the applicable capitalized costs are amortized using the unit-of-production method on the ratio of tonnes of ore mined or processed to the estimated proven and probable mineral reserves as defined by the Canadian Institute of Mining, Metallurgy and Petroleum. &nbsp;As of December 31, 2002, 2001 and 2000, Caledonia did not have any producing mineral properties. As of December 31, 2003 and 2004 the Barbrook gold mine in South Africa was the company&#146;s only operating mineral property.</font></P>
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<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><B><font face="Arial">Non-Producing Properties</font></B></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><font face="Arial">Costs relating to the acquisition, exploration and development of non-producing resource properties which are held by Caledonia, or through its participation in joint ventures, are capitalized until such time as either economically recoverable reserves are established, or the properties are sold or abandoned. &nbsp;</font></P>
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<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><font face="Arial">A decision to abandon, reduce or expand activity on a specific project is based upon many factors including general and specific assessments of mineral reserves, anticipated future mineral prices, anticipated costs of developing and operating a producing mine, the expiration date of mineral property leases, and the general likelihood that Caledonia will continue exploration on the project. &nbsp;However, based on the results at the conclusion of each phase of an exploration program, properties that are not suitable as prospects are re-evaluated to determine if future exploration is warranted and that carrying values are appropriate.</font></P>
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<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><font face="Arial">The ultimate recovery of these costs depends on the discovery and development of economic ore reserves, or the sale of the properties or the mineral rights. &nbsp;The amounts shown for non-producing resource properties do not necessarily reflect present or future values.</font></P>
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<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><font face="Arial">However US GAAP requires that mineral properties with no proven resources be reflected as expenses in the period incurred.</font> </P>
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<P style="margin:0pt; padding-left:56.7pt; font-family:Times New Roman" align=justify><font face="Arial">Caledonia had three major capital expenditure programs for the year 2004 that included the Rooipoort platinum exploration project, the Roodepoort/Eersteling mine gold exploration projects and the previously discussed refurbishment and commissioning of its Barbrook mine. &nbsp;The major capital expenditure commitments for the year 2005 are the previously discussed metallurgical plant additions/modifications (that may include the construction of a Biox &#174; plant) &nbsp;at its Barbrook Mine that requires capital expenditure of &nbsp;about US$8.0 to $9.0 million if a Biox &#174; plant is constructed. It is planned to carry out further drilling on the Rooipoort platinum group metals property, drill platinum exploration targets at Grasvally as soon as a Prospecting Permit is obtained, drill gold exploration targets on the Eersteling mine property, possible further shallow exploration at the Roodepoort proper
ty, and a bulk sampling and pilot-plant test at the Nama cobalt/copper property in Zambia. &nbsp;As discussed earlier, and depending upon &nbsp;a sustainable Rand gold price and the exploration results from the exploration drilling on the property, it is possible that &nbsp;Caledonia &nbsp;will commence the refurbishment at its Eersteling gold &nbsp;mine in South Africa &nbsp;in 2005.</font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">B</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Liquidity and Capital Resources</font></B></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">A discussion on the &#145;Liquidity and Capital Resources&#146; for 2004 and its comparison to 2003 is given in the 2004 Annual Report of Caledonia under the section &quot;Management Discussion and Analysis &#150; &#145;Liquidity and Capital Resources&#146; and &#145;Uses of Liquidity&#146;&#148;. These are &nbsp;&nbsp;shown on pages 17 and 18 of the 2004 Annual Report, which section is incorporated herein by reference.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Reference is also made to the Section D above, titled &#147;Risk Factors&#148; for further information concerning liquidity and capital resources.</font> </P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Reference is made to the &#147;Comments by Auditors for U.S. Readers on Canada-US Reporting Conflict&#148; which is shown on page 23 (un-numbered) of the 2004 Annual Report and which is incorporated here by reference. &nbsp;</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The cash flows from operations and investing activities has varied between 2002, 2003 and 2004. &nbsp;Cash is invested in an interest-bearing money market fund. &nbsp;In 2002 financing by private placement and exercise of warrants raised $5.2 million, net of fees. This allowed repayment of loans in an amount of S1.0 million by a combination of $0.4 million in cash and the issuance of shares. In 2003, financing by private placements and the exercise of warrants and share options raised $9.459 million net of fees and in 2004, financing by private placements and the exercise of warrants &nbsp;raised $14.314 million net of fees . These transactions are discussed in more detail later in this section.</font> </P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Following previous cost curtailment programs and a significant reduction of expenditures on mineral and capital properties to conserve cash resources, the company requires about $1.4 to 2.0 million annually to maintain Caledonia as a reporting issuer in North America and maintain its assets. Cash flow from operations has been affected in 2002 by the uneconomic operations at Filon Sur that resulted in zero fees received from the management services contract. Filon Sur was placed into liquidation by its major shareholder in January 2002. In 1999, 2000 and 2001 certain officers and directors of Caledonia deferred a significant portion of salaries. The combination of deferral of salaries, short-term loans and equity financing kept Caledonia in operation over this period. In 2002, equity financing and exercise of warrants enabled the company to maintain its operation.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;In 2003, cash to continue operations was obtained by the issuance of share capital from private placements and from the exercise of warrants or share options. Due to unexpected metallurgical recoveries the positive cash flow from the restart of Caledonia&#146;s Barbrook gold mine did not materialize. In the 1<SUP>st</SUP> quarter of 2003, an amount of about $2.39 million, net of financing costs was raised from the portion of the private placement financing carried over from December 2002, the exercise of warrants and share options. A further $4.6 million (net of costs) was raised by private placement in August 2003. In April 2004, the company raised &nbsp;a net amount of &nbsp;$14.3 million from private placements and from the exercise of warrants The funds raised by the 2004 financing will mainly be used on activities which will allow Caledonia to maintain and/or re-start operations, make capital 
additions to the Barbrook mine and metallurgical plant, for drilling &nbsp;the Eersteling and Roodepoort gold and the Rooipoort and Grasvally</font> </P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">platinum projects in South Africa and bulk sampling and processing of material from &nbsp;Caledonia&#146;s Nama copper/cobalt project in Zambia. The funds raised will be sufficient to move forward with the direct development of some of the assets if economically and technically justified. &nbsp;Should additional funding be required it is likely that the company will raise further funds by private placement financings with arms-length subscribers as has been its practice in recent years.</font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">C</font></B></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><B><font face="Arial">Research and Development, Patents and Licenses, New Technology, etc.</font></B></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Except for minor expenditures, $10,000 in 1999 and a similar amount in 2001, Caledonia has carried out no work on research and development over the past 5 years. &nbsp;In 1999, a small amount was spent on research of three flotation concentrates from Caledonia&#146;s Barbrook Gold Mine by the EMR Microwave Technology Corporation to develop the potential of a new processing route to recover gold from the three refractory concentrates. &nbsp;The preliminary results from the tests were inconclusive and it was decided to suspend further tests until the microwave technology process was more industrially developed. &nbsp;Generally, the R &amp; D work by Caledonia is limited to the development of more efficient metal extraction procedures.<B> &nbsp;</B>In 2001, development work was carried out on a sample of ore from the Taylor&#146;s section of the Barbrook Mine at the Mintek Laboratory in South Africa. &nbsp;
A bulk flotation concentrate was produced from the ore and tested for oxidation and gold recovery procedures. These tests were carried out to try to attain a relatively inexpensive oxidation of the refractory minerals present and a higher gold recovery using the &#147;resin-in-leach&#148; process rather than the &#147;carbon-in-leach&quot; previously used at Barbrook. The &#147;oxidation&#148; test work proved to be inconclusive but the &#147;resin-in-leach&#148; process tested, incorporating kerosene or diesel addition to blind the carbonaceous material in the Barbrook ore that are highly preg-robbing, gave consistently higher gold recoveries in the leach process. The &#147;resin-in-leach&#148; process was included in the metallurgical plant at Barbrook. Management also decided that the Anglo American Corporation/Kemix&#146;s pump cell technology would be incorporated into the new resin-in-leach circuit. The metallurgical circuit has included flash flotation and the Knelson gravity concentration technology 
in the gold milling circuit to aim to increase early gold recovery and reduce gold lock up in the primary mill. The metallurgical circuit also includes two G-cell flotation cleaner cells that are designed to increase the gold grades reporting to the regrind and leach circuits and two Aachen reactors which provide high-intensity oxidation and should result in higher gold recovery for the Taylor&#146;s ore. During 2004, Caledonia&#146;s subsidiary, Barbrook Mines Ltd, negotiated a license agreement with Biomin Technologies SA of Switzerland to allow Biomin&#146;s &#147;BIOX&#174;&#148; process &nbsp;&nbsp;to be used at the Barbrook Gold Mine. Additional details of this process are given on page 11 of the 2004 Annual Report which is incorporated herein by reference.</font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">D</font></B></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><B><font face="Arial">Trend Information</font></B> </P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Following the closure of the Filon Sur gold mine in January 2002, Caledonia has not had any involvement in producing operations until 2003. The Barbrook gold mine was restarted in the 2<SUP>nd</SUP> quarter of 2003. The possible re-commencement of the Eersteling gold mine in the latter part of 2005 will depend on the price of gold, the Rand / US$ exchange rate and the results of the Eersteling exploration program, all of which have been discussed previously in this report<B>.</B> Caledonia will continue to raise finance from time to time as needed to continue in business until its operations are self funding. Until this self-financing is achieved it is likely that the practice used in previous years of entering into private placements with arms-length subscribers will continue. Similarly, as in the past, to minimize its own cash expenditures on its portfolio of exploration properties, Caledonia will cont
inue, where possible and desirable to joint venture certain of &nbsp;its properties to major mining companies.</font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Times New Roman" align=justify><B><font face="Arial">E.</font></B></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Off-balance sheet arrangements</font></B></P>
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<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">The company has no off-balance sheet arrangements.</font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Times New Roman" align=justify><B><font face="Arial">F.</font></B></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Tabular Disclosure of Contractual Obligations</font></B></P>
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<TABLE style="font-size:10pt" cellspacing=0 align=center><TR><TD style="border:0.5pt solid #000000" valign=top width=101.267><P style="margin:0pt; font-family:Times New Roman" align=center><B><I><font face="Arial">Contractual Obligations</font></I></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=59.4><P style="margin:0pt; font-family:Times New Roman" align=center><B><I><font face="Arial">Total</font></I></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=67.067><P style="margin:0pt; font-family:Times New Roman" align=center><B><I><font face="Arial">Less than 1 Year</font></I></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=68.467><P style="margin:0pt; font-family:Times New Roman" align=center><B><I><font face="Arial">2 to 3 Years</font></I></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=72.867><P style="margin:0pt; font-family:Times New Roman" align=center><B><I><font face="Arial">4 to 5 years</font></I></B></P>
</TD><TD style="border-right: 1 solid #000000; border-top: 0.5pt solid #000000; border-bottom: 0.5pt solid #000000" valign=top width=59.467><P style="margin:0pt; font-family:Times New Roman" align=center><B><I><font face="Arial">More than 5 years</font></I></B></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=101.267><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=59.4><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=67.067><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=68.467><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=72.867><font face="Arial">&nbsp;</font></TD><TD style="border-right: 1 solid #000000; border-bottom: 0.5pt solid #000000" valign=top width=59.467><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=101.267><P style="margin:0pt; font-family:Times New Roman"><B><font face="Arial">Operating or Purchase &nbsp;lease obligations</font></B> </P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=59.4><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">$320,000</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=67.067><P style="margin:0pt; font-family:Times New Roman"><font face="Arial">$52,000</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=68.467><P style="margin:0pt; font-family:Times New Roman"><font face="Arial">$121,000</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=72.867><P style="margin:0pt; font-family:Times New Roman"><font face="Arial">$147,000</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=59.467><P style="margin:0pt; font-family:Times New Roman"><font face="Arial">$Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=101.267><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=59.4><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=67.067><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=68.467><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=72.867><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=59.467><font face="Arial">&nbsp;</font></TD></TR>
</TABLE>
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<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;The above relate to the South African regional office costs. Caledonia has minor cost obligations in respect of licenses and prospecting fees for its exploration and mining properties some of which are paid by Caledonia&#146;s joint venture partners.</font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">6.</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES</font></B></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">A</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Directors and Senior Management</font></B></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">A list of the directors and the officers of Caledonia is given on page 46 of the 2004 Annual Report that is incorporated by reference. &nbsp;A brief profile of each of the Directors and the senior management is given below:</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><B>Stefan E. Hayden</B><I>, President and Chief Executive Officer</I></font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. Hayden has extensive experience as a company manager in South Africa. Initially he founded, developed and managed an engineering company that manufactured flameproof mining machinery. He followed this by managing a company holding the Massey Ferguson franchise in the Transvaal and the Orange Free State and returned it to profitability for the then owners Standard Corporate Merchant Bank. He then founded and managed the South African agency for heavy electrical equipment sales and installations for Toshiba Corporation of Japan. &nbsp;He has been Managing Director of Industrial Brokers, a family company specializing in the procurement of steel and mining machinery, since 1971 and continues in this position. &nbsp;</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">With his wide managerial, electrical and mechanical, and mining experience Mr. Hayden has acted as technical advisor to numerous mines and companies in Southern Africa. &nbsp;Prior to the Caledonia acquisition, Mr. Hayden as the Chief Executive Officer of Eersteling Gold Mining Company Limited and Barbrook Mines Limited was responsible for both operations. He joined Caledonia in 1995 and was appointed Managing Director, African Operations responsible for the development of Caledonia&#146;s business in Africa. In June 1996, Mr. Hayden was elected as a Director of Caledonia and subsequently appointed Deputy Chairman of Caledonia. In January 1997 he was appointed Chairman of Caledonia and in June 1997 the position of President and Chief Executive Officer was added to his responsibilities. In February 2005, Mr. Hayden relinquished the position of Chairman when Mr. Rupert Pardoe was elected as a director and 
appointed as Chairman by the Board.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><B>James Johnstone, </B>B.Sc<I>., ARCST, P.Eng. &nbsp;Director, Vice President Operations and Chief Operating Officer </I></font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">A graduate-mining engineer Mr. Johnstone has 40 years experience in mine operations in North America, Africa and Europe. He has experience in both underground and open pit operations. &nbsp;For the past 20 years he has been employed as General Manager or Vice-President Operations for mining companies producing gold, base metals and industrial minerals. Mr. Johnstone has been responsible for the construction, start up and commissioning of two major mines in addition to the commissioning of Caledonia's Filon Sur operation. He has also been involved in the orderly closure of three operations. He has operated successfully in environmentally sensitive areas and has a good understanding of the permitting process in Canada and the United States. Mr. Johnstone joined Caledonia in April 1997 as Vice President Operations and is responsible for Caledonia's operations in Zambia and South Africa and</font> </P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">for all activities in Canada. He was elected a Director of Caledonia in June 1997. Mr. Johnstone is a director of several of Caledonia&#146;s subsidiaries and of Fynegold Exploration Limited (UK).</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><B>Christopher Harvey</B>, <I>LRIC, HNC (Chem.), Director, Company Secretary and Technical Director</I></font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">A Chemistry graduate from Wigan Mining College, Mr. Harvey has spent his career in the international mineral processing industry. Prior to immigrating to Canada in 1987 he worked for the Anglo American Group in a number of senior metallurgical positions. These included projects associated with gold and copper/cobalt production, gold, uranium and sulfuric acid production from old gold tailings and the investigation and development of a copper/cobalt flow sheet. Mr. Harvey joined Doelcam, a predecessor company of Caledonia in 1989 as Vice-President Operations and was responsible for a number of property evaluations in several countries. He was appointed Senior Vice President of Caledonia at its inception in 1992 and has been a Director since 1993. &nbsp;He has since held a number of senior positions within the company and is currently the company's Technical Director. &nbsp;From late 1996 to the end of Sep
tember 1998, Mr. Harvey was seconded to Filon Sur in Spain for the construction, commissioning and ongoing operation of the expansion to the heap-leach expansion project. He has also coordinated metallurgical studies for most of the company's projects, such as the Nama copper/cobalt project, the Eureka copper/gold project and the Kadola copper project in Zambia, Barbrook gold mine refractory gold recovery project and the provisional Rooipoort platinum project in South Africa and the Cononish gold project in Scotland. &nbsp;He is also a director of Fynegold Exploration Limited (UK) and subsidiary companies, Barbrook Gold Mines Limited and Eersteling Gold Mining Company Limited of South Africa.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><B>Jeff Smith</B>, <I>B.Sc. &nbsp;Vice President Exploration</I>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">A geologist with over 30 years experience in the international mining industry. &nbsp;Mr. Smith worked as a mine geologist for Consolidated Murchison in South Africa and Turkey before moving to JCI's head office. With JCI he was responsible for various exploration and evaluation projects in southern Africa and Europe and managed a joint venture lead project. Mr. Smith worked for Caledonia as an independent consultant for a number of years, initially drawing on his wide knowledge of the Iberian pyrite belt and then on a worldwide basis. He joined Caledonia as Vice President - Exploration in November 1996. &nbsp;&nbsp;He presently works for Caledonia on a consulting basis and operates a consulting service covering the Iberian Peninsula and Europe.</font></P>
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<P style="margin:0pt; text-indent:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><B>Mike D. Tombs, </B>M.B.A<I>., F.C.M.A. Vice-President Finance and Chief Financial Officer</I> </font> </P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. Tombs holds an MBA degree from Heriot-Watt University, Edinburgh, Scotland, and is a member of the Chartered Institute of Management Accountants. &nbsp;He was involved in the manufacturing industry in the United Kingdom before moving to South Africa where he joined the mining division of Anglovaal. At Anglovaal he held a number of senior financial management positions, culminating in his appointment as General Manager: Finance and Administration of Avgold, the groups focused gold mining and exploration company. &nbsp;After a period running his own company consulting to both mining and non-mining operations in Southern and East Africa Mr. Tombs joined Caledonia in March 2004 as Financial Manager: Africa. &nbsp;Mr. Tombs will be based in Caledonia&#146;s Johannesburg office.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><B>Ian Forrest</B> <I>- Non- executive Director</I></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. Forrest is an accountant by profession and has wide experience as an executive in the resource industry. &nbsp;He has been a director of Caledonia since inception in February 1992 and prior to that date he was a director of one of the predecessor companies for many years. He is a member of the board of directors of Mengold Resources Inc. (Montreal, Canada), Georex S.A. (Paris, France), Desire Petroleum plc (London, AIM, UK), Polymet Mining Corp (Toronto, Canada and OTCBB), Viatrade plc (London, OFEX, UK) and Belmore Resources plc (Ireland). &nbsp;Mr. Forrest is based in Geneva, Switzerland.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><B>Carl Jonsson</B> <I>- Non- executive Director and legal adviser to Caledonia</I></font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. Jonsson is a lawyer by profession and has been associated with the resource industry for over 30 years. &nbsp;In his legal practice he has specialized in securities and corporate work. He has been a director of Caledonia since February 1992 and prior to that date he was a director of one of the predecessor companies, Golden North Resources Inc. for many years. &nbsp;Mr. Jonsson is resident in Vancouver, British Columbia, Canada and is a principal of the law firm Tupper, Jonsson and Yeadon. &nbsp;Mr. Jonsson sits on the board of directors of several companies in Canada, including, Acrex Ventures, Altima Resources Ltd., Bonterra Energy Income Trust, Comet Industries Ltd., Dolly Varden Resources Inc., Earthworks Industries Inc. &#150; (Secretary only), Novitas Energy Ltd, TelcoPlus Enterprises Ltd. and Comaplex Minerals Corporation.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; padding-right:-28.7pt; font-family:Times New Roman" align=justify><font face="Arial"><B>Roland G. Fasel</B> -<I> Non- executive Director</I></font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. Fasel is a qualified accountant and is a director of several public companies in Switzerland. &nbsp;He is currently Director of Progesco Geneve SA (&#147;Progesco&#148;) a public accounting firm. &nbsp;Prior to joining Progesco Mr. Fasel spent many years in senior positions with the European divisions of the AMF Group until their reorganization. &nbsp;M. Fasel is based in Geneva, Switzerland.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><B>Rupert Pardoe</B> &#150; <I>Non-executive Chairman</I></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Rupert Pardoe (48) graduated from the University of Cape Town with a BA in Comparative African Government and Law and completed his honors degree cum laude in Development Administration and Politics at the University of South Africa. After a year in Paris, studying at the Sorbonne, he joined Anglo American as a management trainee in 1981, where he held various roles over a twenty year period, including Personal Assistant to Gavin Reilly, then Chairman, Finance Director of Anglo American Industrial Corporation (AMIC) and Finance Director of the Corporation from 1997 to 2001. &nbsp;Mr. Pardoe was also a member of the Corporation&#146;s Executive Committee, Audit Committee, Administration Committee and Credit Committee, which he chaired. &nbsp;He was also a member of the Investment Committee of Anglo American plc. At ABSA, he was a member of the Group Executive Committee and its Group Investment Committee. 
He was also Chairman of both ABSA&#146;s Retail Bank Board and its Commercial Bank Board.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. Pardoe has served on a number of boards, both in South Africa and abroad, including AECI, Amgold, Anglo Coal, Anglo Platinum, Boart Longyear, FirstRand, Highveld Steel and Vanadium, Rand Merchant Bank and Mondi. &nbsp;He currently operates as a business consultant in South Africa and specializes in assisting South African companies with black economic empowerment matters.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. Pardoe was appointed to the Caledonia board and elected Chairman in February 2005.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><B>Family Relationships</B>:</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">There are no known family relationships between the officers, key employees and directors.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><B><font face="Arial">Arrangements, Understandings, etc.</font></B></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">To the best knowledge of Caledonia, there are no arrangements or understanding with any major shareholders, customers, suppliers or others, pursuant to which any person referred to above, was selected as a director or member of senior management.</font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">B</font></B></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-0.55pt; font-family:Times New Roman" align=justify><B><font face="Arial">Compensation</font></B></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman"><font face="Arial">The amount of compensation paid, and benefits in kind granted to Caledonia&#146;s directors and senior management is given under the &quot;Summary Compensation Table&quot; on page 6 of the 2005 Management Proxy Circular to the shareholder that is incorporated herein by reference. &nbsp;This table lists the compensation to the three executive directors and to Messer&#146;s. Poad, Du Plessis, Tombs and Smith. &nbsp;As stated in the notes to the table, in view of the cash situation of Caledonia, senior management deferred receiving a part of their salaries in 1999, 2000 and 2001. &nbsp;No compensation was deferred in 2002 or 2003. Some deferred compensation was paid during 2003 and 2004. There was no deferred compensation owing at December 31, 2004.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">There was a $ 5,000 fee paid to each of the directors annually until 2003. This was increased to $10,000 annually in June 2004 with the fee for 2004 being calculated pro-rata as $7,500. Mr. Fasel who was appointed at mid-year received $5000 for 2004. The adverse cash situation from 1999 to 2001 caused each of the directors to defer receiving this fee since 1998. However during 2003, the deferred director&#146;s fees owing to all directors, and amounting to $20,000 each, were paid out in full. There were no stock options awarded to senior management or the directors in 1999, 2000 and 2001. In 2002, a total of 10,000,000 stock options were granted to the directors of Caledonia. The exercise price of the options was $0.235 and the options expire in April 2012. A total of 225,000 options were granted to officers of Caledonia at $0.35 and expiring in June 2012. Mr. J. du Plessis, the General Manager - South A
frica, was granted 500,000 share options with an exercise price of $0.28 and an expiry date of November 03, 2013 when he joined the company in 2003. An amount of 300,000 of these share options are un-exercisable until various productivity targets in South Africa had been met. In April 2004, 1,010,000 stock options were granted to an officer and senior management of Caledonia with an exercise price of $0.26 and an expiry date of April 29<SUP>th</SUP> 2014. &nbsp;Mr. Roland Fasel was granted 200,000 stock options with an exercise price of $0.26 and an expiry date of August 2014 on his appointment to the Board of Directors. &nbsp;An amount of 50,000 of these options vested effective as of the date of his appointment, the remainder will vest in lots of 50,000 on the first, second and third anniversaries of his appointment. &nbsp;Mr. Pardoe, the Chairman of the Corporation was granted 4,000,000 stock options on his appointment as a director and chairman in February 2005 with an exercise price of $0.11 and expirin
g in February 2015. An amount of 2,000,000 options were granted in February and the remaining 2,000,000 options will be vested in February 2006. The total share options granted to the senior management, in 2004 and prior years are given in the table &quot;Summary Compensation Table&quot; on page 6 of the 2005 Management Proxy Circular to the shareholder that is incorporated herein by reference.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Caledonia does not have a bonus or profit-sharing plan. &nbsp;Caledonia does not have a pension, retirement or similar benefits scheme.</font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Times New Roman" align=justify><B><font face="Arial">C</font></B></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Board Practices</font></B></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The directors all hold their positions for an indefinite term, subject to re-election at each annual general meeting of the shareholders. &nbsp;The officers hold their positions subject to being removed by resolution of the Board of Directors. Furthermore, the &quot;Election of Directors&quot; is discussed on page 4 of the 2005 Management Proxy Circular that is incorporated herein by reference. &nbsp;The Table on page<B> </B>4<B> </B>of the 2005 Management Proxy Circular provides the term of office for each director. &nbsp;In addition, the shareholdings of those directors named on the table hold about 0.015% collectively of the total shares of Caledonia outstanding at December 31, 2004. &nbsp;Officers of Caledonia who are not directors do not own any shares as at December 31, 2004.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">There are no service contracts between Caledonia and any of the Directors of Caledonia or its subsidiaries except for (i) a &quot;Key Executive Severance Protection Plan&quot; between Caledonia and two of its directors - namely Mr. S. Hayden and Mr. F. C. Harvey dating from 1996, (ii) the indirect employment of Caledonia&#146;s president and CEO through a management and administrative agreement and (iii) an employment contract with a director, Mr. J. Johnstone. &nbsp;The &#147;Severance Plan&#148; calls for severance payments to these executives if employment is terminated as a result of a change of control of Caledonia. &nbsp;Mr. Johnstone&#146;s employment contract with Caledonia has a termination clause whereby Mr. Johnstone is paid a severance payment of one year of salary in the event of his termination due to change of control or without cause. Details concerning Caledonia&#146;s Board Composition,
 Audit, Compensation, Nominating and Corporate Governance committees are given in the 2005 Management Proxy Circular on pages 8, 10 &amp;11, which are incorporated herein by reference.</font> </P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;The following directors are members of the following committees:</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:36pt; font-family:Times New Roman" align=justify><B><I><font face="Arial">AUDIT</font></I></B></P>
<B><I><P style="margin-top:0pt; margin-bottom:-12pt; text-indent:144pt; font-family:Times New Roman" align=justify><font face="Arial">COMPENSATION</font></I></B></P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:252pt; font-family:Times New Roman" align=justify><B><I><font face="Arial">NOMINATING</font></I></B></P>
<B><I><P style="margin:0pt; text-indent:360pt; font-family:Times New Roman" align=justify><font face="Arial">GOVERNANCE</font></I></B></P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. C. Jonsson</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:144pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. C. Jonsson</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:252pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. R. Pardoe</font></P>
<P style="margin:0pt; text-indent:360pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. R. Pardoe</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. &nbsp;R. Fasel</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:144pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. S. Hayden</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:252pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. R. Fasel</font></P>
<P style="margin:0pt; text-indent:360pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. S. Hayden</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. I. Forrest</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:144pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. I. Forrest</font></P>
<P style="margin:0pt; text-indent:360pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. C. Jonsson</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:144pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. R.Pardoe</font></P>
<P style="margin:0pt; text-indent:360pt; font-family:Times New Roman" align=justify><font face="Arial">Mr. I. Forrest</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Prior to Mr. Fasel&#146;s appointment to the Board of Directors and to the Audit committee in August 2004, Mr. Hayden was a member of the Audit committee.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Times New Roman" align=justify><B><font face="Arial">D</font></B></P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Employees</font></B></P>
<P style="margin:0pt; text-indent:108pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
&nbsp;
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The average, approximate number of employees, their categories and geographic location for each of the last 3 years are summarized in the table below:</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:35.45pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><B><font face="Arial">Geographic Location and Number of Employees:</font></B></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<div align="center">
  <center>
<TABLE style="font-size: 10pt" cellspacing=0 width="486"><TR><TD valign=bottom width=257><P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><B><font size="2" face="Arial">Employee Location etc</font></B></P>
</TD><TD valign=bottom width=64 align="right"><P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=right><B><U><font size="2" face="Arial">2002</font></U></B></P>
</TD><TD valign=bottom width=73 align="right"><P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=right><B><U><font size="2" face="Arial">2003</font></U></B></P>
</TD><TD valign=bottom width=96 align="right"><P style="line-height: 100%; font-family: Times New Roman; font-size: 12pt; margin: 0pt"><B><U><font size="2" face="Arial">2004</font></U></B></P>
</TD></TR>
<TR><TD valign=bottom width=257><P style="margin:0pt; font-family:Times New Roman"><B><font size="2" face="Arial">Total Employees</font></B></P>
</TD><TD valign=bottom width=64><P style="margin:0pt; font-family:Times New Roman"><font size="2" face="Arial"><BR></font></P>
</TD><TD valign=bottom width=73><font size="2" face="Arial">&nbsp;</font></TD><TD valign=bottom width=96><font size="2" face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=bottom width=257><P style="margin:0pt; font-family:Times New Roman"><font size="2" face="Arial">Canada (Head Office)</font></P>
</TD><TD valign=bottom width=64><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">2</font></P>
</TD><TD valign=bottom width=73><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">3</font></P>
</TD><TD valign=bottom width=96><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">3</font></P>
</TD></TR>
<TR><TD valign=bottom width=257><P style="margin:0pt; font-family:Times New Roman"><font size="2" face="Arial">South Africa (Head Office)</font></P>
</TD><TD valign=bottom width=64><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">6</font></P>
</TD><TD valign=bottom width=73><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">9</font></P>
</TD><TD valign=bottom width=96><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">9</font></P>
</TD></TR>
<TR><TD valign=bottom width=257><P style="margin:0pt; font-family:Times New Roman"><font size="2" face="Arial">South Africa (Mine Security and Operations and Exploration)</font></P>
</TD><TD valign=bottom width=64><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">115</font></P>
</TD><TD valign=bottom width=73><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">250</font></P>
</TD><TD valign=bottom width=96><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">315</font></P>
</TD></TR>
<TR><TD valign=bottom width=257><P style="margin:0pt; font-family:Times New Roman"><font size="2" face="Arial">Zambia (Head Office and Security)</font></P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=66><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">9</font></P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=75><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">8</font></P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=98><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">8</font></P>
</TD></TR>
<TR><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=259><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt"><B><font size="2" face="Arial">Total Employees at All Locations</font></B></P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=66><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><B><font size="2" face="Arial">132</font></B></P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=75><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><B><font size="2" face="Arial">270</font></B></P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=98><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><B><font size="2" face="Arial">335</font></B></P>
</TD></TR>
<TR><TD valign=bottom width=257><font size="2" face="Arial">&nbsp;</font></TD><TD valign=bottom width=64><font size="2" face="Arial">&nbsp;</font></TD><TD valign=bottom width=73><font size="2" face="Arial">&nbsp;</font></TD><TD valign=top width=96><font size="2" face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=bottom width=257><P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><B><font size="2" face="Arial">Management and Administration:</font></B></P>
</TD><TD valign=bottom width=64><font size="2" face="Arial">&nbsp;</font></TD><TD valign=bottom width=73><font size="2" face="Arial">&nbsp;</font></TD><TD valign=top width=96><font size="2" face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=bottom width=257><font size="2" face="Arial">&nbsp;</font></TD><TD valign=bottom width=64><font size="2" face="Arial">&nbsp;</font></TD><TD valign=bottom width=73><font size="2" face="Arial">&nbsp;</font></TD><TD valign=top width=96><font size="2" face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=bottom width=257><P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><B><font size="2" face="Arial">&nbsp;&nbsp;Employee Location etc.</font></B></P>
</TD><TD valign=bottom width=64><font size="2" face="Arial">&nbsp;</font></TD><TD valign=bottom width=73><font size="2" face="Arial">&nbsp;</font></TD><TD valign=top width=96><font size="2" face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=bottom width=257><P style="margin:0pt; font-family:Times New Roman"><font size="2" face="Arial">Canada (Head Office)</font></P>
</TD><TD valign=bottom width=64><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">2</font></P>
</TD><TD valign=bottom width=73><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">3</font></P>
</TD></center><TD valign=bottom width=96><P style="margin:0pt; font-family:Times New Roman" align="right"><font size="2" face="Arial">3</font></P>
</TD></TR>
  <center>
<TR><TD valign=bottom width=257><P style="margin:0pt; font-family:Times New Roman"><font size="2" face="Arial">South Africa (Head Office)</font></P>
</TD><TD valign=bottom width=64><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">3</font></P>
</TD><TD valign=bottom width=73><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">5</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">6</font></P>
</TD></TR>
<TR><TD valign=bottom width=257><P style="margin:0pt; font-family:Times New Roman"><font size="2" face="Arial">South Africa (Exploration and Operations)</font></P>
</TD><TD valign=bottom width=64><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">2</font></P>
</TD><TD valign=bottom width=73><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">7</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">7</font></P>
</TD></TR>
<TR><TD valign=bottom width=257><P style="margin:0pt; font-family:Times New Roman"><font size="2" face="Arial">Zambia (Head Office and Security)</font></P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=66><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">2</font></P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=75><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">2</font></P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=top width=98><P style="margin:0pt; font-family:Times New Roman" align=right><font size="2" face="Arial">2</font></P>
</TD></TR>
<TR><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=259><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt"><B><font size="2" face="Arial">Total Management and Administration</font></B></P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=66><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><B><font size="2" face="Arial">9</font></B></P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=75><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><B><font size="2" face="Arial">17</font></B></P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=98><P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=center><font size="2" face="Arial"><BR></font></P>
  </center>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align="right"><B><font size="2" face="Arial">&nbsp;18</font></B></P>
</TD></TR>
</TABLE>
</div>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Times New Roman" align=justify><B><font face="Arial">E</font></B></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Share Ownership</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">As of the date of the 2005 Management Proxy Circular (March 18<B><SUP>th</SUP></B>, 2005) the individual share ownership of each of the directors of Caledonia is depicted in the Table on page 4 of the Management Proxy Circular that is incorporated herein by reference. The combined total share ownership of Caledonia&#146;s directors, senior management and officers is less than 1% of the total issued common shares. &nbsp;</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<p style="font-family: Times New Roman; margin: 0pt; padding-left: 35.45pt" align="justify">&nbsp;</p>
<p style="font-family: Times New Roman; margin: 0pt; padding-left: 35.45pt" align="justify">&nbsp;</p>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Caledonia has established &quot;Incentive Stock Option Plans&quot; (the &quot;Plans&quot;) that have been approved and accepted by the Toronto Stock Exchange (&#147;TSX&#148;) and Caledonia&#146;s shareholders &#150; the &#147;1995 Plan&#148; and the &#147;1996 Plan&#148;. &nbsp;Another Plan was amended in 2001 and this amended Plan was approved by a majority of shareholders at the Special and Annual General Meeting of the shareholders held on the 29<SUP>th</SUP> June 2001. &nbsp;However, the three Plans that were approved by the shareholders for the years 1999 to 2001 were never registered with the TSX. Due to financial constraints in 1999 to 2001, Caledonia decided not to implement these plans and in September 2001 requested the TSX to withdraw all requests to register these plans as no options had been issued under the plans at that time. The TSX agreed to this request and the plans were cancelled. In
 2002 a new Plan was prepared, the &#147;2002 Plan&#148;, and approval was sought and obtained from the Shareholders at the 2002 Annual General and Special Meeting held on the 21<SUP>st</SUP> June 2002. Details of the new Share Option plan was reported in the 2002 Management Information Circular to the shareholders, that was incorporated therein by reference in the Form 20F 2001. In 2004 another Plan was prepared, the &#147;2004 Plan&#148;, and approval was sought and obtained from the Shareholders at the 2004 Annual General and Special Meeting held on the 21<SUP>st</SUP> June 2004. Details of the 2004 stock option plan are given on pages 10 and 11 of the 2004 Management Information Circular to the shareholders, that was incorporated by reference in the Form 20F 2004.</font></P>
<p>&nbsp;</p>
<P style="font-family: Times New Roman; text-indent: 0; margin-top: 0pt; margin-bottom: 0; padding-left: 35.45pt" align=justify><B><font face="Arial"><U>SHARE OPTION REGISTER</U> <U>LISTING OF OPTIONS OUTSTANDING as of December 31<SUP>st</SUP> 2004</U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></B></P>
<P style="font-family: Times New Roman; text-indent: 0; margin-top: 0pt; margin-bottom: 0; padding-left: 35.45pt" align=justify>&nbsp;</P>
<P style="font-family: Times New Roman; text-indent: 0; margin-top: 0pt; margin-bottom: 0; padding-left: 35.45pt" align=justify><b><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;<I><U>Option</U></I> <I><U>Price</U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Option Expiry</U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Options</U></I></font></b></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><B><I><U><font face="Arial">Name</font></U></I></B></P>
<B><I><P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><U><font face="Arial">Plan</font></U></I></B></P>
<B><I><P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><U><font face="Arial">Cdn. $</font></U></I></B></P>
<B><I><P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><U><font face="Arial">Date</font></U></I></B></P>
<B><I><P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;<U>O/S</U></font></I></B></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Forrest, W.I.L.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">1995 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.75</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Apr. 28, 2005</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">12,500</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:396.55pt; font-family:Times New Roman" align=justify><B><I><font face="Arial"><BR></font></I></B></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Forrest, W.I.L.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">1996 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.33</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Feb. 09, 2008</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">66,000</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Forrest, W.I.L.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">2002 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.235</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Apr. 24, 2012 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
500,000</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">Forrest, TOTAL</font></U></B></P>
<B><P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><U><font face="Arial">All Plans</font></U></B></P>
<B><P style="margin:0pt; padding-left:35.45pt; text-indent:324.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>578,500 </U></font></B></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Harvey, F.C.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">1995 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.75</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Apr. 28, 2005</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;93,750</font> </P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Harvey, F.C.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">1996 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.33</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Feb. 09, 2008</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">135,000</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Harvey, F.C.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">2002 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.235</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Apr. 24, 201 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
2,000,000</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;<B><U>Harvey TOTAL</U></B></font></P>
<B><P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><U><font face="Arial">All Plans</font></U></B></P>
<B><P style="margin:0pt; padding-left:35.45pt; text-indent:324.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>2,228,750</U></font></B></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Hayden, S.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">1995 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.75</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Apr. 28, 2005</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">125,000</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Hayden, S.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">1996 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.33</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Feb. 09, 2008</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">175,000</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Hayden, S.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">2002 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.235</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Apr. 24, 2012 &nbsp;&nbsp;&nbsp;&nbsp;
4,000,000</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">Hayden, TOTAL</font></U></B></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:72.55pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">All Plans</font></U></B></P>
<B><P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:252.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;</font></B></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><B><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;<U>4,300,000</U></font></B></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Johnstone, J.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">1995 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.75</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Apr. 28, 2005</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;37,500</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;Johnstone, J.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">1996 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.33</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Feb. 09, 2008</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">135,000</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Johnstone, J.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">2002 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.235</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Apr. 24, 2012 &nbsp;&nbsp;&nbsp;&nbsp;
2,000,000</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:396.55pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">Johnstone, TOTAL</font></U></B></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">All Plans</font></U></B></P>
<B><P style="margin:0pt; padding-left:35.45pt; text-indent:324.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>2,172,500</U></font></B></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Jonsson, C.R.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">1995 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.75</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Apr. 28, 2005</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;12,500</font> </P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Jonsson, C.R.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">1996 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.33</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Feb. 09, 2008</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;66,000</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Jonsson, C.R.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">2002 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.235</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Apr. 24, 2012 &nbsp;&nbsp;&nbsp;&nbsp;
1,450,000</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:396.55pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">Jonsson, TOTAL</font></U></B></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:72.55pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">All Plans</font></U></B></P>
<B><P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:252.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>1,616,000</U></font></B> <font face="Arial"> &nbsp;<B>&nbsp;</B></font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:504.55pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Poad, S.W.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">1995 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.75</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Apr. 28, 2005</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;18,825</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;Poad, S.W.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">1996 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.33</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Feb. 09, 2008</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;80,000</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Poad, S W. &nbsp;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">2002 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.345</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">June 02, 2012</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">150,000</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Poad, S.W.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">2002 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.26</font> </P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Apr.29, 2014</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">200,000</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">Poad, TOTAL</font></U></B></P>
<B><P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><U><font face="Arial">All Plans</font></U></B></P>
<B><P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:324.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>448,825</U></font></B></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:396.55pt; font-family:Times New Roman" align=justify><B><font face="Arial"><BR></font></B></P>
<p style="text-indent: 396.55pt; font-family: Times New Roman; margin: 0pt; padding-left: 35.45pt" align="justify">&nbsp;</p>
<p style="text-indent: 396.55pt; font-family: Times New Roman; margin: 0pt; padding-left: 35.45pt" align="justify">&nbsp;</p>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<p style="text-indent: 396.55pt; font-family: Times New Roman; margin: 0pt; padding-left: 35.45pt" align="justify">&nbsp;</p>
<p style="text-indent: 396.55pt; font-family: Times New Roman; margin: 0pt; padding-left: 35.45pt" align="justify">&nbsp;</p>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Smith, J.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">1995 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.75</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Apr. 28, 2005</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;23,750</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;Smith, J.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">1996 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.33</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Feb. 09, 2008</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;80,000</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Smith, J</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">2002 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.345</font> </P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">June 02, 2012</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;75,000</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">Smith, TOTAL</font></U></B></P>
<B><P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><U><font face="Arial">All Plans</font></U></B></P>
<B><P style="margin:0pt; padding-left:35.45pt; text-indent:324.55pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>178,750</U></font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">du Plessis, J</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">2002 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.28</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Nov. 03, 2013</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">500,000*</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">du Plessis, TOTAL</font></U></B></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">All Plans</font></U></B></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">500,000*</font></U></B></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Fasel, R</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">1995 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.26</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Aug. 15, 2014</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">200,000**</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">Fasel, TOTAL</font></U></B></P>
<B><P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><U><font face="Arial">All Plans</font></U></B></P>
<B><P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><U><font face="Arial">200,000**</font></U></B></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Tombs, MD</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">2002 Plan</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:216.55pt; font-family:Times New Roman" align=justify><font face="Arial">0.26</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:288.55pt; font-family:Times New Roman" align=justify><font face="Arial">Apr. 29, 2014</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><font face="Arial">100,000</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">Tombs, TOTAL</font></U></B></P>
<B><U><P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; text-indent:108.55pt; font-family:Times New Roman" align=justify><font face="Arial">All Plans</font></U></B></P>
<B><P style="margin:0pt; padding-left:35.45pt; text-indent:360.55pt; font-family:Times New Roman" align=justify><U><font face="Arial">100,000</font></U></B></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><B><I>Notes to the above Table</I></B>:</font> </P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The price of the options granted under the 1995 Plan were those, which had been re-priced and reduced in number granted, and which were approved by the shareholders of Caledonia at the 1998 Annual General Meeting. &nbsp;The price of the Options granted under the 1996 Plan were those at the close of trading on the Toronto Stock Exchange on the day prior to the granting thereof. &nbsp;The price of the Options granted under the 2002 Plan were those at the close of trading on the Toronto Stock Exchange on the day prior to the granting thereof. &nbsp;Share options granted pursuant to the 2002 Plan above were approved at the Annual Meeting of Shareholders held on June 21, 2002. The 2002 Plan was discussed in the 2002 Management Proxy circular which was incorporated by reference in the 2001 Form 20 F.</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify>&nbsp;</P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The 2004 Plan was discussed in the 2004 Management Proxy circular which was incorporated by reference in the 2003 Form 20 F.</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">In 2003, an officer of Caledonia exercised 56,475 options priced at $0.50 and 50,000 options priced at $0.235 were exercised by a director of Caledonia. The balance of the $0.50 share options allocated, in total 1,175,625 options, expired on the 28<SUP>th</SUP> of April 2003 without exercising.</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<ul>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Symbol" align="justify"><font face="Arial">* An amount of 300,000 of the stock options awarded to Mr. du Plessis are non-exercisable until certain productivity targets associated with the two South African gold mines are achieved.</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Symbol" align="justify"><font face="Arial">** An amount of 50,000 or 25% of the stock options awarded to Mr. Fasel vested on his appointment as Director in August 2004. An amount of 50,000 stock options will vest on each of the first, second and third anniversaries of his appointment.</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Symbol" align="justify"><font face="Arial">In February 2005 4,000,000 stock options were awarded to Mr. Pardoe on his appointment as a Director. &nbsp;Of these, 500,000 stock options vested immediately, the remainder vest in quarterly tranches each of 500,000 options commencing on June 30, 2005.</font></li>
</ul>
<P style="margin:0pt; padding-left:18pt; font-family:Courier; font-size:12pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">7</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">&nbsp;MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:35.45pt; font-family:Times New Roman" align="left"><font face="Arial"><B>Significant
shareholders</B>
<BR>
</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">To the best of Caledonia's knowledge, as of March 22, 2005 there are 1 known shareholder and 2 depository trusts that beneficially own, directly or indirectly, or exercise control or direction over more than 5% of the voting shares of Caledonia. &nbsp;As at March 23, 2005 Caledonia had 301,112,286 shares outstanding and the known shareholders and depository trusts holding more than 5% of the shares of Caledonia are given in the table below:</font></P>
<p style="text-indent: 396.55pt; font-family: Times New Roman; margin: 0pt; padding-left: 35.45pt" align="justify">&nbsp;</p>
<p style="text-indent: 396.55pt; font-family: Times New Roman; margin: 0pt; padding-left: 35.45pt" align="justify">&nbsp;</p>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<p style="text-indent: 396.55pt; font-family: Times New Roman; margin: 0pt; padding-left: 35.45pt" align="justify">&nbsp;</p>
<P style="margin:0pt; text-indent:288pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border:0.9pt solid #000000" valign=top width=183.6><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><B><font face="Arial">Name of Shareholder</font></B></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:1pt solid #000000" valign=top width=189.067><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=center><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><B><font face="Arial">Number of Shares Held</font></B></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:1pt solid #000000" valign=top width=192><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=center><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><B><font face="Arial">% of Shares Issued</font></B></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:1pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=183.6><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">CEDE and Co.</font> </P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=189.067><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">75,113,534</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=192><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">24.95 %</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:1pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=183.6><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">Suborad S.A.</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=189.067><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">15,150,000</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=192><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">5.03%</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:1pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=183.6><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">CDS &amp; Co. NCI Accounts</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=189.067><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">178,427,792</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=192><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">59.26%</font></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The only shares issued by Caledonia are common shares. &nbsp;Although Caledonia has an unlimited number of preferential shares available for issue, none of these have yet been issued. Caledonia&#146;s major shareholders have the same voting rights as the other shareholders of Caledonia.</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">To the best of the knowledge of Caledonia, the portion of the common shares of Caledonia is held in the following geographic locations:</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border:0.9pt solid #000000" valign=top width=168.733><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><B><font face="Arial">Geographic Area</font></B></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:1pt solid #000000" valign=top width=198><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><B><font face="Arial">Number of Shares Held</font></B></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:1pt solid #000000" valign=top width=198><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><B><font face="Arial">Percentage of Shares Issued</font></B></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:1pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=168.733><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">USA (Host country)</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=198><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">81,725,933</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=198><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">27.14%</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:1pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=168.733><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">Canada</font> </P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=198><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">180,990,772</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=198><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">60.11%</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:1pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=168.733><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">Europe</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=198><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">4,080,427</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=198><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">&nbsp;&nbsp;1.36%</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:1pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=168.733><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">Other</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=198><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">34,315,178</font></P>
</TD><TD style="border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=198><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">11.39%</font></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">There are 1,312 record holders listed by Equity Transfer Services Inc. in Toronto, Canada that includes the two large depository trusts - CEDE &amp; Co. and CDS &amp; Co.</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Caledonia is not, to the best of its knowledge, directly or indirectly owned or controlled by another corporation or corporations, by any other natural or legal person or persons severally or jointly or by any foreign government.</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Caledonia is not aware of any arrangement, the operation of which may at some subsequent date result in a change of control of Caledonia.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">B</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Related party transactions</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Until June 30, 2004, Caledonia has paid a company that employs Caledonia&#146;s &nbsp;President and CEO, a fee of $180,000 per annum in terms of the management and administration services agreement. This agreement, which has not changed for several years was renegotiated in 2004 such that the fee for the period July to December 2004 would increase equivalent to $270,000 per annum and then in January 2005 to $360,000 per annum. Caledonia pays Doelcam Inc. on a per diem rate for financial and administration services. Caledonia&#146;s Controller is a major shareholder in Doelcam Inc. &nbsp;Caledonia leases office premises in South Africa from a company of which the family of Caledonia&#146;s President and CEO are shareholders. Note 10 on pages 39 and 40 of the 2004 Audited Financial Statements fully details the related party transactions, and forms part of the 2004 Annual Report that is herein incorporated 
by reference.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">C</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Interests of experts and counsel</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Not required, as this is an &#147;annual report under the Exchange Act&#148;.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<p style="text-indent: 396.55pt; font-family: Times New Roman; margin: 0pt; padding-left: 35.45pt" align="justify">&nbsp;</p>
<p style="text-indent: 396.55pt; font-family: Times New Roman; margin: 0pt; padding-left: 35.45pt" align="justify">&nbsp;</p>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<p style="text-indent: 396.55pt; font-family: Times New Roman; margin: 0pt; padding-left: 35.45pt" align="justify">&nbsp;</p>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">8</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">FINANCIAL INFORMATION</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">A</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Consolidated Statements and Other Financial Information</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Attached as Exhibit 14a is the 2004 Annual Report of Caledonia, which reports include the audited financial statements of Caledonia and which are incorporated herein by reference. Note 15 &nbsp;of these financial statements titled &quot;Generally Accepted Accounting Principles in Canada and the United States&quot; compares the differences in GAAP between the two countries.</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The 2004 consolidated financial statements have been audited by BDO Dunwoody LLP and comprise the following:</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">Auditor&#146;s report</font></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">Balance sheet</font></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">Income statement (Statement of Operations)</font></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">Statement of deficit</font></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">Statement of cash flows</font></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">Summary of significant accounting policies</font> </P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">Notes to &nbsp;the financial statements</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Note 4 of the 2004 financial statements &#150; &#147;Share Capital&#148; which is incorporated herein by reference, shows the changes, in share capital since 31<SUP>st</SUP> December 2001.</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The 2004 financial statements cover the period from 2002 to 2004 and thus cover the requirements for the Form 20F disclosure.</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Export sales are not a significant portion of the sales volume.</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Caledonia has no ongoing legal or arbitration proceedings at the 31<SUP>st</SUP> December 2004. To the best knowledge of Caledonia, neither any of its directors or senior management or its affiliates is a party adverse to Caledonia or its subsidiaries, or has a material interest adverse to Caledonia or its subsidiaries. However, in April 2001, Caledonia initiated civil legal proceedings against Mr. Gert Jordaan the principal of Spring Hills Trading to recover damages resulting from its non-fulfillment of its obligations in respect of its agreement with Caledonia for the purchase of a 49% interest in the Barbrook and Eersteling mines in South Africa. Mr. Jordaan has been declared insolvent and Caledonia, Barbrook and Eersteling have received a portion of the monies owed to them from the Liquidator of Jordaan's estate</font> </P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The Company has never paid and does not intend, at this stage, to declare or pay cash dividends on Common Stock in the foreseeable future.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">9</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><font face="Arial"><B>THE OFFER AND LISTING</B>
<BR>
</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Caledonia&#146;s stock trades on the Toronto Stock Exchange under the symbol &quot;CAL&quot; and on the NASDAQ Stock Exchange&#146;s &quot;Over-the-counter Bulletin Board&quot; under the symbol &quot;CALVF&quot;.</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The trading history is as follows:</font></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:72.2pt; text-indent:-36.75pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">(a)</font></U></B></P>
<P style="margin:0pt; padding-left:72.2pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">5 Year Market Trading Record</font></U></B></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=bottom width=106.667><P style="margin:0pt; font-family:Times New Roman"><B><U><font face="Arial">Stock Exchange</font></U></B></P>
</TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman" align=right><B><U><font face="Arial">2000</font></U></B></P>
</TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman" align=right><B><U><font face="Arial">2001</font></U></B></P>
</TD><TD valign=bottom width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><B><U><font face="Arial">2002</font></U></B></P>
</TD><TD valign=bottom width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><B><U><font face="Arial">2003</font></U></B></P>
</TD><TD valign=top width=81.067><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:17pt; font-family:Times New Roman" align=right><B><U><font face="Arial">2004</font></U></B></P>
</TD></TR>
<TR><TD valign=bottom width=106.667><P style="margin:0pt; font-family:Times New Roman"><B><font face="Arial">TORONTO</font></B></P>
</TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
</TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
</TD><TD valign=bottom width=81.067><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
</TD><TD valign=bottom width=81.067><font face="Arial">&nbsp;</font></TD><TD valign=top width=81.067><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=bottom width=106.667><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B>High</font></P>
</TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.35</font></P>
</TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.09</font></P>
</TD><TD valign=bottom width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.50</font></P>
</TD><TD valign=bottom width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.61</font></P>
</TD><TD valign=top width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.465</font></P>
</TD></TR>
<TR><TD valign=bottom width=106.667><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B>Low</font></P>
</TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.05</font></P>
</TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.03</font></P>
</TD><TD valign=bottom width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.05</font></P>
</TD><TD valign=bottom width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.22</font></P>
</TD><TD valign=top width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.12</font></P>
</TD></TR>
<TR><TD valign=bottom width=106.667><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B>Volume</font></P>
</TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">22,938,622</font></P>
</TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">22,309,687</font></P>
</TD><TD valign=bottom width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">81,234,046</font></P>
</TD><TD valign=bottom width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">99,233,133</font></P>
</TD></center><TD valign=top width=81.067><P style="margin:0pt; font-family:Times New Roman" align="right"><font face="Arial">56,933,982</font></P>
</TD></TR>
  <center>
<TR><TD valign=bottom width=106.667><P style="margin:0pt; font-family:Times New Roman"><B><font face="Arial">NASDAQ (US$)</font></B></P>
</TD><TD valign=bottom width=74.4><font face="Arial">&nbsp;</font></TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
</TD><TD valign=bottom width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
</TD><TD valign=bottom width=81.067><font face="Arial">&nbsp;</font></TD><TD valign=top width=81.067><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=bottom width=106.667><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B>High</font></P>
</TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.18</font></P>
</TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.06</font></P>
</TD><TD valign=bottom width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.281</font></P>
</TD><TD valign=bottom width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.39</font></P>
</TD><TD valign=top width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.37</font></P>
</TD></TR>
<TR><TD valign=bottom width=106.667><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B>Low</font></P>
</TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.03</font></P>
</TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.02</font></P>
</TD><TD valign=bottom width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.040</font></P>
</TD><TD valign=bottom width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.16</font></P>
</TD><TD valign=top width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.10</font></P>
</TD></TR>
<TR><TD valign=bottom width=106.667><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B>Volume</font></P>
</TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">61,918,700</font></P>
</TD><TD valign=bottom width=74.4><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">74,714,400</font></P>
</TD><TD valign=bottom width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">271,403,969</font></P>
</TD><TD valign=bottom width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">440,810,918</font></P>
</TD><TD valign=top width=81.067><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">210,251,339</font></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:72.2pt; text-indent:-36.75pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">(b)</font></U></B></P>
<P style="margin:0pt; padding-left:72.2pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">2 Year Market Trading Record by Quarter &#150; 2003, 2004 and 1<SUP>st</SUP> Quarter 2005 (January and February)</font></U></B></P>
<P style="margin:0pt; padding-left:72.2pt; font-family:Times New Roman" align=justify>&nbsp;</P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=151.2>
<P style="margin:0pt; font-family:Times New Roman" align=center><B><U><font face="Arial">Stock Exchange</font></U></B></P>
</TD><TD valign=top width=189 colspan=2>
<P style="margin:0pt; font-family:Times New Roman" align=center><B><U><font face="Arial">TSE</font></U></B></P>
</TD><TD valign=top width=198.467 colspan=2><P style="margin:0pt; font-family:Times New Roman" align=center><B><U><font face="Arial">NASDAQ</font></U></B></P>
</TD></TR>
<TR><TD valign=top width=151.2><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><B><U><font face="Arial">Share Price</font></U></B></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><B><U><font face="Arial">High</font></U></B></P>
</TD><TD valign=top width=94.467><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><B><U><font face="Arial">Low</font></U></B></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><B><U><font face="Arial">High</font></U></B></P>
</TD><TD valign=top width=103.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><B><U><font face="Arial">Low</font></U></B></P>
</TD></TR>
<TR><TD valign=top width=151.2><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">2003 - 1<SUP>st</SUP> Qtr.</font></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.61</font></P>
</TD><TD valign=top width=94.467><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.27</font></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.385</font></P>
</TD><TD valign=top width=103.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.180</font></P>
</TD></TR>
<TR><TD valign=top width=151.2><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B>- 2<SUP>nd</SUP> Qtr.</font></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.33</font></P>
</TD><TD valign=top width=94.467><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.22</font></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.25</font></P>
</TD><TD valign=top width=103.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.16</font></P>
</TD></TR>
<TR><TD valign=top width=151.2><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B>- 3<SUP>rd</SUP> Qtr.</font></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.43</font></P>
</TD><TD valign=top width=94.467><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.25</font></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.30</font></P>
</TD><TD valign=top width=103.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.19</font></P>
</TD></TR>
<TR><TD valign=top width=151.2><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B>- 4<SUP>th</SUP> Qtr.</font></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.48</font></P>
</TD><TD valign=top width=94.467><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.26</font></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.37</font></P>
</TD><TD valign=top width=103.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.19</font></P>
</TD></TR>
<TR><TD valign=top width=151.2><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">2004 - 1<SUP>st</SUP> Qtr.</font></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.47</font></P>
</TD><TD valign=top width=94.467><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.32</font></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.37</font></P>
</TD><TD valign=top width=103.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.25</font></P>
</TD></TR>
<TR><TD valign=top width=151.2><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><B><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- 2<SUP>nd</SUP> Qtr</font></B></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.35</font></P>
</TD><TD valign=top width=94.467><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.205</font></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.27</font></P>
</TD><TD valign=top width=103.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.15</font></P>
</TD></TR>
<TR><TD valign=top width=151.2><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><B><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- 3<SUP>rd</SUP> Qtr</font></B></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.235</font></P>
</TD><TD valign=top width=94.467><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.17</font></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.18</font></P>
</TD><TD valign=top width=103.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.13</font></P>
</TD></TR>
<TR><TD valign=top width=151.2><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><B><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- 4<SUP>th</SUP> Qtr</font></B></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.225</font></P>
</TD><TD valign=top width=94.467><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.12</font></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.18</font></P>
</TD><TD valign=top width=103.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.10</font></P>
</TD></TR>
<TR><TD valign=top width=151.2><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt"><B><font face="Arial">2005 &#150; 1<SUP>st</SUP> Qtr to Feb.28<SUP>th&nbsp; </SUP></font></B></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;$0.16</font></P>
</TD><TD valign=top width=94.467><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.10</font></P>
</TD><TD valign=top width=94.533><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.13</font></P>
</TD><TD valign=top width=103.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.08</font></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:72.2pt; text-indent:-36.75pt; font-family:Times New Roman" align=justify><B><font face="Arial">(c)</font></B></P>
<P style="margin:0pt; padding-left:72.2pt; font-family:Times New Roman" align=justify><B><font face="Arial">6 Month Market Trading Record by Month &#150; September 2004 to February 2005</font></B></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=bottom width=149.267><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR><B><U>Stock Exchange</U></B></font></P>
</TD><TD valign=bottom width=193.867 colspan=2>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><B><U><font face="Arial">TSE</font></U></B></P>
</TD><TD valign=bottom width=193.867 colspan=2><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=center><font face="Arial"><BR><B><U>NASDAQ</U></B></font></P>
</TD></TR>
<TR><TD valign=top width=149.267><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><B><U><font face="Arial">Share Price</font></U></B></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><B><U><font face="Arial">High</font></U></B></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><B><U><font face="Arial">Low</font></U></B></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><B><U><font face="Arial">High</font></U></B></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><B><U><font face="Arial">Low</font></U></B></P>
</TD></TR>
<TR><TD valign=top width=149.267><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">September 2004</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.235</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.185</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.18</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.15</font></P>
</TD></TR>
<TR><TD valign=top width=149.267><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">October 2004</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.225</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.195</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.18</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=right><font face="Arial">$0.16</font></P>
</TD></TR>
<TR><TD valign=top width=149.267><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">November 2004</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=right><font face="Arial">$0.19</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=right><font face="Arial">$0.16</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=right><font face="Arial">$0.17</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=right><font face="Arial">$0.14</font></P>
</TD></TR>
<TR><TD valign=top width=149.267><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">December 2004</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=right><font face="Arial">$0.16</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=right><font face="Arial">$0.12</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=right><font face="Arial">$0.14</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=right><font face="Arial">$0.10</font></P>
</TD></TR>
<TR><TD valign=top width=149.267><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">January 2005</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=right><font face="Arial">$0.13</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=right><font face="Arial">$0.10</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=right><font face="Arial">$0.11</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=right><font face="Arial">$0.08</font></P>
</TD></TR>
<TR><TD valign=top width=149.267><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">February 2005</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=right><font face="Arial">$0.16</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=right><font face="Arial">$0.11</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=right><font face="Arial">$0.13</font></P>
</TD><TD valign=top width=96.933><P style="margin:0pt; line-height:6pt; font-family:Times New Roman" align=right><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=right><font face="Arial">$0.08</font></P>
</TD></TR>
<TR><TD valign=top width=149.267><font face="Arial">&nbsp;</font></TD><TD valign=top width=96.933><font face="Arial">&nbsp;</font></TD><TD valign=top width=96.933><font face="Arial">&nbsp;</font></TD><TD valign=top width=96.933><font face="Arial">&nbsp;</font></TD><TD valign=top width=96.933><font face="Arial">&nbsp;</font></TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">B</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Plan of distribution</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Not required, as this is an &#147;annual report under the Securities Act&#148;.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">C</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Markets</font></B></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Please refer to section 9A of this Form 20F for details of Caledonia&#146;s trading history on the Toronto Stock Exchange and the NASDAQ OTCBB exchange. The Corporation is currently determining whether it should be listed on the London Stock Exchange&#146;s &#147;Alternative Investment Market (&#147;AIM&#148;).</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">D</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Selling Shareholders</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Not required as this is an &#147;annual report under the Securities Act&#148;.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">E</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Dilution</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Not required as this is an &#147;annual report under the Securities Act&#148;.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">F</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Expenses of the issue</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Not required as this is an &#147;annual report under the Securities Act&#148;.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">10</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">ADDITIONAL INFORMATION</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">A</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Share capital</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Not required as this is an &#147;annual report under the Securities Act&#148;.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">B</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Memorandum and articles of association</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The memorandum and articles of association of Caledonia have previously been provided. At a Special Meeting of the Shareholders held on January 18th 1999, the shareholders approved a resolution amending the articles of Caledonia by creating a class of preference shares of Caledonia. Such preference shares could be issued in series and the directors of Caledonia were authorized to divide such class into series and to fix the number in each series and the rights, privileges, restrictions and conditions thereof.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">C</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Material contracts</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">There are no material contracts other than contracts entered into in the ordinary course of business.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">D</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Exchange controls</font></B></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">There are no governmental laws, decrees or regulations existing in Canada (where Caledonia is incorporated), which restrict the export or import of capital, or the remittance of dividends, interest or other payments to non-resident holders of Caledonia's securities. &nbsp;Nor does Canada have foreign exchange currency controls.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">E</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Taxation</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">To the best of Caledonia's knowledge, there are no taxes or similar levies which holders of Caledonia's shares resident in the United States are subject to; provided however, Caledonia understands that pursuant to a Canada - U.S. tax treaty, any dividends which Caledonia might declare will be subject to such Canadian withholding taxes as the then current provisions of the treaty may require.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">F</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Dividends and paying agents</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Not required as this is an &#147;annual report under the Securities Act&#148;.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">G</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Statement by experts</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Not required as this is an &#147;annual report under the Securities Act&#148;.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">H</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Documents on display</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The documents referred to in this report are either attached as &#147;Exhibits&#148; to this report or can be viewed at the Canadian Head Office of Caledonia whose address is given in section 4 of this report.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">I</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Subsidiary information</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">To the best knowledge of Caledonia there is no other information related to Caledonia's subsidiaries that requires to be provided.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">11</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK</font></B></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">As Caledonia is considered to be a &#147;small business issuer&#148; as defined, information is not required to be provided for this section.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">12</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Not required as this is an &#147;annual report under the Securities Act&#148;.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:16pt; font-family:Times New Roman; font-size:14pt" align=center><B><font face="Arial">PART 2</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">13</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">DEFAULTS, DIVIDEND ARREARAGES and DELINQUENCIES</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">There have been no material defaults in the payment of interest or principal or any dividend arrearages or material delinquencies.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">14</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">MATERIAL MODIFICATIONS to the RIGHTS of SECURITY HOLDERS and USE OF PROCEEDS</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">There has been no material modification to the rights of Caledonia's or subsidiaries security holders.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left>&nbsp;</P>
<p align="left">&nbsp;
<P style="margin-top:0pt; margin-bottom:-9.55pt; line-height:9.55pt; font-family:Times New Roman" align="left"><B><font face="Arial">15</font></B></P>
<P style="margin-top:0pt; margin-bottom:0.95pt; text-indent:36pt; line-height:7.55pt; font-family:Times New Roman" align="left"><B><font face="Arial">CONTROLS AND PROCEDURES</font></B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:70.9pt; text-indent:-35.45pt; font-family:Times New Roman" align=justify><font face="Arial">(a)</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:70.9pt; font-family:Times New Roman" align=justify><U><font face="Arial">Evaluation of disclosure controls and procedures.</font></U></P>
<P style="margin:0pt; padding-left:70.9pt; text-indent:217.1pt; font-family:Times New Roman" align=justify><font face="Arial">The Company&#146;s chief executive officer and chief financial officer have evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-14(c) and 15d-14(c) under the Exchange Act), as of the year end of December 31, 2004. &nbsp;Based on such evaluation, they have concluded that as of such date, our disclosure controls and procedures are effective and designed to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in applicable SEC rules and forms.</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman; font-size:12pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:70.9pt; text-indent:-35.45pt; font-family:Times New Roman" align=justify><font face="Arial">(b)</font></P>
<P style="margin:0pt; padding-left:70.9pt; font-family:Times New Roman" align=justify><U><font face="Arial">Management&#146;s annual report on internal control over financial reporting</font></U> </P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:70.9pt; font-family:Times New Roman" align=justify><font face="Arial"><B>&nbsp;&nbsp;</B>Not yet required as the Registrant is a Foreign Private Issuer.</font></P>
<P style="margin:0pt; padding-left:70.9pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:70.9pt; text-indent:-35.45pt; font-family:Times New Roman" align=justify><font face="Arial">(c)</font></P>
<P style="margin:0pt; padding-left:70.9pt; font-family:Times New Roman" align=justify><U><font face="Arial">Attestation Report of registered public accounting firm</font></U> </P>
<P style="margin:0pt; padding-left:-15.25pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:70.9pt; font-family:Times New Roman" align=justify><font face="Arial">Not yet required as the Registrant is a Foreign Private Issuer.</font></P>
<P style="margin:0pt; padding-left:70.9pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:70.9pt; text-indent:-35.45pt; font-family:Times New Roman" align=justify><font face="Arial">(d)</font></P>
<P style="margin:0pt; padding-left:70.9pt; font-family:Times New Roman" align=justify><font face="Arial"><U>Changes in internal controls over financial reporting</U>. There were no significant changes in our internal controls over financial reporting identified in connection with the evaluation required by paragraph (d) of 17 CFR 240.13a-15 or 240.15d-15 that occurred during the period covered by this annual report that has affected, or is reasonably likely to materially affect, the issuer&#146;s internal control over financial reporting.</font> </P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">16</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">(RESERVED)</font></B></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Times New Roman" align=justify><B><font face="Arial">16A</font></B></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Audit Committee Financial Expert</font></B></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:70.9pt; text-indent:-35.45pt; font-family:Times New Roman" align=justify><font face="Arial">(a)</font></P>
<P style="margin:0pt; padding-left:70.9pt; font-family:Times New Roman" align=justify><font face="Arial">The registrant&#146;s board of directors has determined that the registrant has at least two audit &nbsp;committee financial experts serving on its audit committee.</font></P>
<P style="margin:0pt; padding-left:70.9pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:70.9pt; text-indent:-35.45pt; font-family:Times New Roman" align=justify><font face="Arial">(b)</font></P>
<P style="margin:0pt; padding-left:70.9pt; font-family:Times New Roman" align=justify><font face="Arial">The audit committee financial experts serving on the audit committee are Mr. W.I.L. Forrest and Mr. R. Fasel who are independent directors under the NASDAQ rules.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Times New Roman" align=justify><B><font face="Arial">16B</font></B></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Code of Ethics</font></B></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:70.9pt; text-indent:-35.45pt; font-family:Times New Roman" align=justify><font face="Arial">(a)</font></P>
<P style="margin:0pt; padding-left:70.9pt; font-family:Times New Roman" align=justify><font face="Arial">On April 8, 2004 the registrant&#146;s Board of Directors adopted a code of ethics that applies to the registrant&#146;s chief executive officer, chief financial officer, principal accounting officer or controller, or persons performing similar functions. &nbsp;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:70.9pt; text-indent:-35.45pt; font-family:Times New Roman" align=justify><font face="Arial">(b)</font></P>
<P style="margin:0pt; padding-left:70.9pt; font-family:Times New Roman" align=justify><font face="Arial">The registrant has filed with the Commission a copy of this code of ethics that applies to the registrant&#146;s chief executive officer, chief financial officer, principal accounting officer or controller, or persons performing similar functions. &nbsp;This Code of Ethics was filed as Exhibit 1 with the Form 20F 2003 and is incorporated herein by reference.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:70.9pt; text-indent:-35.45pt; font-family:Times New Roman" align=justify><font face="Arial">(c)</font></P>
<P style="margin:0pt; padding-left:70.9pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;The text of this code of ethics has been posted on the company website at <FONT COLOR=#0000FF><U>http://www.caledoniamining.com</U></FONT> &nbsp;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:70.9pt; text-indent:-35.45pt; font-family:Times New Roman" align=justify><font face="Arial">(d)</font></P>
<P style="margin:0pt; padding-left:70.9pt; font-family:Times New Roman" align=justify><font face="Arial">The text of this code of ethics is available on request, without charge, by contacting the company at &nbsp;either of the principal offices listed in part 4A of this report or by e-mail to info@caledoniamining.com</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Times New Roman" align=justify><B><font face="Arial">16C</font></B></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Audit Fees</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:85.05pt; text-indent:-49.6pt; font-family:Times New Roman" align=justify><font face="Arial">(a)</font></P>
<P style="margin:0pt; padding-left:85.05pt; font-family:Times New Roman" align=justify><font face="Arial">For 2003 Caledonia&#146;s audit fees were $98,942. The audit fees for 2004 are estimated to be about $153,000.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:72.2pt; text-indent:-36.75pt; font-family:Times New Roman" align=justify><font face="Arial">(b)</font></P>
<P style="margin:0pt; padding-left:72.2pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;
Nil.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:72.2pt; text-indent:-36.75pt; font-family:Times New Roman" align=justify><font face="Arial">(c)</font></P>
<P style="margin:0pt; padding-left:72.2pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;
Nil.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:72.2pt; text-indent:-36.75pt; font-family:Times New Roman" align=justify><font face="Arial">(d)</font></P>
<P style="margin:0pt; padding-left:72.2pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;
Nil.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:85.05pt; text-indent:-49.6pt; font-family:Times New Roman" align=justify><font face="Arial">(e) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
<P style="margin:0pt; padding-left:85.05pt; font-family:Times New Roman" align=justify><font face="Arial">Prior to the start of the audit process, Caledonia&#146;s audit committee receives an estimate of the costs, from its auditors and reviews such costs for their reasonableness. After their review and pre-approval of the fees, the audit committee recommend to the board of directors to accept the estimated audit fees given by the auditors.</font> </P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:72.2pt; text-indent:-36.75pt; font-family:Times New Roman" align=justify><font face="Arial">(e)</font></P>
<P style="margin:0pt; padding-left:72.2pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Not applicable</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Times New Roman" align=justify><B><font face="Arial">16D</font></B></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Exemptions from the Listing Standards for Audit Committees</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Not applicable.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Times New Roman" align=justify><B><font face="Arial">16E</font> </B></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">Purchases of Equity Securities by the Issuer and Affiliated Purchasers</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">There were no purchases made by or on behalf of the issuer or any &#147;affiliated purchaser &#147; as defined in &#167;240.10b-18(a)(3), of shares or other units of any class of the issuer&#146;s equity securities that is registered by the issuer pursuant to section 12 of the Exchange Act (15 U.S.C. 78<I>1</I>).</font></P>
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<font face="Arial">
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<P style="margin:0pt; line-height:16pt; font-family:Times New Roman; font-size:14pt" align=center><B><font face="Arial">PART 3</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">17.</font></B></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-0.55pt; font-family:Times New Roman" align=justify><B><font face="Arial">FINANCIAL STATEMENTS</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The audited consolidated financial statements and related notes of Caledonia at December 31, 2004, 2003 and 2002 are set forth in the Registrant's 2004 Annual Report that is incorporated herein as Exhibit 14a by reference.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">18.</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><B><font face="Arial">FINANCIAL STATEMENTS</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The registrant has elected to provide financial statements pursuant to Item 17 that include as Note 15 the differences between Canadian and US GAAP's.</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=justify><B><font face="Arial">19. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;EXHIBITS</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The following Financial Statements and Exhibits are attached to and form part of this</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Statement and are incorporated herein by reference:</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; text-indent:-21.25pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; text-indent:-21.25pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">12. &nbsp;&nbsp;Certifications Pursuant to Rule 13a-14(a)(17CFR240.13a-14(a) or Rule 15d-14(a)(17CFR240.15d-14(a).</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=justify><font face="Arial">13.a Certification Pursuant to 18 U.S.C. section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">14.a</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:21.25pt; font-family:Times New Roman" align=justify><font face="Arial">Caledonia Mining Corporation, 2004 Annual Report.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">14.b</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:21.25pt; font-family:Times New Roman" align=justify><font face="Arial">Caledonia Mining Corporation, 2005 Management Proxy Circular.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">14.c</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:21.25pt; font-family:Times New Roman" align=justify><font face="Arial">Schedules.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">14.d</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:21.25pt; font-family:Times New Roman" align=justify><font face="Arial">Mineral Properties.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">14.e</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:21.25pt; font-family:Times New Roman" align=justify><font face="Arial">Summary of Independent Qualified Person&#146;s Report &#150; &#147;Barbrook Mines Limited&#148;.</font></P>
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<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=center><font face="Arial">SIGNATURE</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">The Registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this registration statement [Annual Report] on its behalf.</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">DATED at Mississauga, Ontario, Canada, on the 31<SUP>st</SUP> &nbsp;day of March 2005.</font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><B><font face="Arial">CALEDONIA MINING CORPORATION</font></B></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:35.45pt; font-family:Times New Roman" align=justify><font face="Arial">Per:</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:21.25pt; font-family:Times New Roman" align=justify><font face="Arial">(Signed) &nbsp;<B>F. C. Harvey</B></font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:72.55pt; font-family:Times New Roman" align=justify><font face="Arial">Technical Director</font></P>
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<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">CALEDONIA MINING CORPORATION</font></B></P>
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<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">302 CERTIFICATIONS</font></B></P>
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<P style="margin:0pt; font-family:Times New Roman" align=justify><B><font face="Arial">CERTIFICATIONS</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align="left"><font face="Arial">I, Stefan E. Hayden, certify that:</font></P>
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<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">1.</font></P>
<P style="margin:0pt; text-indent:36pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">I have reviewed this annual report on Form 20-F of Caledonia Mining Corporation.</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:35.45pt; text-indent:-35.45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">2.</font></P>
<P style="margin:0pt; padding-left:35.45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:35.45pt; text-indent:-35.45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">3.</font></P>
<P style="margin:0pt; padding-left:35.45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;</font> </P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:35.45pt; text-indent:-35.45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">4.</font></P>
<P style="margin:0pt; padding-left:35.45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">The company&#146;s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e)) and have:</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:54pt; text-indent:-18pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">a.</font></P>
<P style="margin:0pt; padding-left:54pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;</font> </P>
<P style="margin:0pt; padding-left:63.8pt; text-indent:-27.8pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:54pt; text-indent:-18pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">b.</font></P>
<P style="margin:0pt; padding-left:54pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Evaluated the effectiveness of the company&#146;s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:54pt; text-indent:-18pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">c.</font></P>
<P style="margin:0pt; padding-left:54pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Disclosed in this report &nbsp;&nbsp;any change in the company&#146;s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is likely to materially affect, the company&#146;s internal control over financial reporting; and</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:35.45pt; text-indent:-35.45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">5.</font></P>
<P style="margin:0pt; padding-left:35.45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">The company&#146;s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company&#146;s auditors and the audit committee of the company&#146;s board of directors (or persons performing the equivalent function);</font> </P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:63.8pt; text-indent:-28.35pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">a.</font></P>
<P style="margin:0pt; padding-left:63.8pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to &nbsp;adversely affect the company&#146;s ability to record, process, summarize and report financial information; and</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:63.8pt; text-indent:-27.8pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">b.</font></P>
<P style="margin:0pt; padding-left:63.8pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Any, fraud, whether or not material, that involves management or other employees who have a significant role in the company&#146;s internal control over financial reporting.</font></P>
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<P style="margin-top:0pt; margin-bottom:-11pt; text-indent:36pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">Date<U>: &nbsp;&nbsp;&nbsp;&nbsp;March 31<SUP>st</SUP> &nbsp;2005</U></font></P>
<P style="margin:0pt; text-indent:324pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">(signed) <U>S.E. Hayden</U></font></P>
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<P style="margin:0pt; padding-left:288pt; text-indent:36pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">President and CEO</font></P>
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<P style="margin:0pt; font-family:Times New Roman" align=justify><B><font face="Arial">CERTIFICATIONS</font></B></P>
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<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align="left"><font face="Arial">I &nbsp;Mike D. Tombs certify that:</font></P>
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<P style="margin-top:0pt; margin-bottom:-11pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">1.</font></P>
<P style="margin:0pt; text-indent:36pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">I have reviewed this annual report on Form 20-F of Caledonia Mining Corporation.</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:35.45pt; text-indent:-35.45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">2.</font></P>
<P style="margin:0pt; padding-left:35.45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:35.45pt; text-indent:-35.45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">3.</font></P>
<P style="margin:0pt; padding-left:35.45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;<BR></font> </P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:35.45pt; text-indent:-35.45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">4.</font></P>
<P style="margin:0pt; padding-left:35.45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">The company&#146;s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e)) and have:</font> </P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:56.7pt; text-indent:-20.7pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">a.</font></P>
<P style="margin:0pt; padding-left:56.7pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;</font></P>
<P style="margin:0pt; padding-left:63.8pt; text-indent:-27.8pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:54pt; text-indent:-18pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">b.</font></P>
<P style="margin:0pt; padding-left:54pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Evaluated the effectiveness of the company&#146;s disclosure controls and procedures &nbsp;and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:54pt; text-indent:-18pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">c.</font></P>
<P style="margin:0pt; padding-left:54pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Disclosed in this report &nbsp;&nbsp;any change in the company&#146;s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is likely to materially affect, the company&#146;s internal control over financial reporting; and</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:35.45pt; text-indent:-35.45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">5.</font></P>
<P style="margin:0pt; padding-left:35.45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">The company&#146;s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company&#146;s auditors and the audit committee of the company&#146;s board of directors (or persons performing the equivalent function);</font> </P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:63.8pt; text-indent:-28.35pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">a.</font></P>
<P style="margin:0pt; padding-left:63.8pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to &nbsp;adversely affect the company&#146;s ability to record, process, summarize and report financial information; and</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-11pt; padding-left:63.8pt; text-indent:-27.8pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">b.</font></P>
<P style="margin:0pt; padding-left:63.8pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Any, fraud, whether or not material, that involves management or other employees who have a significant role in the company&#146;s internal control over financial reporting.</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
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<P style="margin-top:0pt; margin-bottom:-11pt; text-indent:36pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">Date<U>: &nbsp;&nbsp;&nbsp;&nbsp;March 31<SUP>st</SUP> 2005</U></font></P>
<P style="margin:0pt; text-indent:324pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">(signed) <U>M.D. Tombs</U></font></P>
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<P style="margin:0pt; padding-left:288pt; text-indent:36pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">Vice- President Finance and CFO</font></P>
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<P style="margin:0pt; padding-left:35.45pt; font-family:Times New Roman" align=justify>&nbsp;</P>
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<P style="margin:0pt; font-family:Times New Roman" align=center>&nbsp;</P>
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<P style="margin:0pt; padding:3pt; line-height:18pt; font-family:Times New Roman; font-size:16pt; border:18pt double #000000" align=center><B><font face="Arial">EXHIBIT #13</font></B></P>
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<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">CALEDONIA MINING CORPORATION</font></B></P>
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<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">Certification Pursuant to 18 U.S.C. section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002</font></B></P>
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<P style="margin:0pt; font-family:Times New Roman" align=right><B><font face="Arial">Exhibit 13a</font></B></P>
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<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=center><B><font face="Arial">CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350</font></B></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=center><B><font face="Arial">AS ADOPTED PURSUANT TO SECTION 906 OF</font></B></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=center><B><font face="Arial">THE SARBANES-OXLEY ACT OF 2002</font></B></P>
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<P style="margin:0pt; font-family:Times New Roman" align="left"><font face="Arial">In connection with the Annual Report on Form 20-F of Caledonia Mining Corporation (the &#147;Company&#148;) for the year ended December 31, 2004 as filed with the Securities and Exchange Commission on the date hereof (the &#147;Report&#148;), that I, Stefan E. Hayden, President and Chief Executive Officer of &nbsp;Caledonia , certify, pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code 18 U.S.C.1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:</font></P>
<P style="margin:0pt; font-family:Times New Roman" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:54pt; text-indent:-36pt; font-family:Times New Roman" align="left"><font face="Arial">1.</font></P>
<P style="margin:0pt; padding-left:54pt; text-indent:-18pt; font-family:Times New Roman" align="left"><font face="Arial">The Report fully complies with the requirements of Rule 13(a) or 15(d) of the Securities Exchange Act of 1934; and</font></P>
<P style="margin:0pt; text-indent:-35.45pt; font-family:Times New Roman" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:54pt; text-indent:-36pt; font-family:Times New Roman" align="left"><font face="Arial">2.</font></P>
<P style="margin:0pt; padding-left:54pt; text-indent:-18.55pt; font-family:Times New Roman" align="left"><font face="Arial">The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.</font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Times New Roman" align="left"><font face="Arial">By:</font></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align="left"><font face="Arial"><U>(signed) </U><B><U>S. E. Hayden</U></B></font></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align="left"><font face="Arial">Stefan E. Hayden, President and Chief Executive Officer</font></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align="left"><font face="Arial">Caledonia Mining Corporation</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align="left"><font face="Arial">A signed original of this written statement required by Section 906 has been provided by Stefan E. Hayden and will be retained by Caledonia Mining Corporation and furnished to the Securities and Exchange Commission or its staff upon request.</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=center><B><font face="Arial">CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350</font></B></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=center><B><font face="Arial">AS ADOPTED PURSUANT TO SECTION 906 OF</font></B></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=center><B><U><font face="Arial">THE SARBANES-OXLEY ACT OF 2002</font></U></B></P>
<P style="margin:0pt; font-family:Courier; font-size:11pt" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align="left"><font face="Arial">In connection with the Annual Report on Form 20-F of Caledonia Mining Corporation (the &#147;Company&#148;) for the year ended December 31, 2004 as filed with the Securities and Exchange Commission on the date hereof (the &#147;Report&#148;), that I, Michael Tombs, Vice President Finance and Chief Financial Officer of &nbsp;Caledonia , certify, pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code 18 U.S.C.1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:</font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Times New Roman" align="left"><font face="Arial">1</font></P>
<P style="margin:0pt; text-indent:72pt; font-family:Times New Roman" align="left"><font face="Arial">The Report fully complies with the requirements of Rule 13(a) or 15(d) of the Securities Exchange Act of 1934; and</font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Times New Roman" align="left"><font face="Arial">2.</font></P>
<P style="margin:0pt; text-indent:72pt; font-family:Times New Roman" align="left"><font face="Arial">The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Caledonia.</font></P>
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<P style="margin:0pt; font-family:Times New Roman" align="left"><font face="Arial">By<U>: &nbsp;&nbsp;(signed) </U><B><U>M.D. Tombs</U></B></font></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align="left"><font face="Arial">Mike D. Tombs, Vice President Finance and Chief Financial Officer</font></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align="left"><font face="Arial">Caledonia Mining Corporation</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align="left"><font face="Arial">A signed original of this written statement required by Section 906 has been provided by Mike D. Tombs and will be retained by Caledonia Mining Corporation and furnished to the Securities and Exchange Commission or its staff upon request.</font></P>
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<P style="margin:0pt; padding:3pt; line-height:18pt; font-family:Times New Roman; font-size:16pt; border:18pt double #000000" align=center><B><font face="Arial">EXHIBIT #14a</font></B></P>
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<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">CALEDONIA MINING CORPORATION</font></B></P>
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<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">2004 ANNUAL REPORT</font></B></P>
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<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=641.333><P style="margin-top:4pt; margin-bottom:4pt; line-height:7.55pt; font-family:Shruti; font-size:12pt; color:#FFFFFF" align="left"><B><font face="Arial">2004 HIGHLIGHTS</font></B></P>
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<P style="margin:0pt; line-height:15pt; font-family:Shruti; font-size:13pt" align="left"><B><font face="Arial">Barbrook Gold Mine</font></B></P>
<ul>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Completed major modifications to Barbrook metallurgical plant and continued to improve gold recoveries in the resin-in-leach (RIL) circuit &nbsp;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Barbrook underground development continued at the French Bob&#146;s, Taylors and Daylight/Victory zones to delineate the mine&#146;s reserves and resources</font></li>
</ul>
<p style="margin-top:4.35pt; margin-bottom:0pt; line-height:15pt; font-family:Shruti; font-size:13pt" align="left"><B><font face="Arial">Exploration</font></B></p>
<ul>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Completed detailed soil sampling and a preliminary three hole (500m) drilling program at the Roodepoort Gold Exploration Project</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Commenced a detailed soil sampling programme at Eersteling, to complement a planned high resolution aeromagnetic survey that was flown in January 2005</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Phase 1 and 2 drilling implemented at the Rooipoort Platinum Exploration Project</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Purchased prospecting rights over an additional 342 hectares immediately adjacent to the Rooipoort Platinum Exploration Project property on the farm Grasvally 293 KR</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Gravity and magnetic <A NAME="OLE_LINK1"></A><A NAME="OLE_LINK2"></A>Falcon&#174; survey conducted at the Mulonga Plain Diamond Joint Venture and 73 heavy mineral samples collected at Kashiji Plain</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Heavy mineral sampling program completed at the Kikerk Lake Diamond Joint Venture</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Mini bulk sample at the Nama Cobalt Project in Zambia tested to confirm feasibility of producing economic cobalt. Initiated plans and environmental applications to excavate a larger sample which will be treated in pilot plant on site in 2005</font></li>
</ul>
<P style="margin-top:3pt; margin-bottom:0pt; font-family:Shruti; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:3pt; margin-bottom:0pt; line-height:14pt; font-family:Shruti; font-size:12pt" align="left"><B><font face="Arial">Corporate / Financial</font></B></P>
<ul>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Obtained shareholder approval to increase the Caledonia board of directors to six members and appointed Roland Fasel, a Swiss based businessman, to the Caledonia Board of directors</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Appointed Mike Tombs as Vice President Finance and Chief Financial Officer, based in Johannesburg, South Africa. Steven Poad has assumed the position of Controller</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Redeemed minority shareholdings in Eersteling, thus making Eersteling a 100% owned subsidiary of Caledonia</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Raised $13.4 million net of financing costs from private placement and $0.8 million from the exercise of warrants</font></li>
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<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=641.333><P style="margin-top:4pt; margin-bottom:4pt; line-height:7.55pt; font-family:Shruti; font-size:12pt; color:#FFFFFF" align="left"><B><font face="Arial">2005 OBJECTIVES</font></B></P>
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<ul>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Return the Barbrook Gold Mine in South Africa to economic gold production</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Continue developing additional reserves/resources at the Barbrook Mine</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Complete the feasibility studies of installing a Biox&#174; bacterial leach and/or ultra-fine milling and/or Dense Media Separation circuit at Barbrook and commence construction</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Obtain the prospecting licence for the Grasvally portions of the Rooipoort Platinum Exploration Project</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Identify the platinum resource on the farms Rooipoort and Grasvally which form the Rooipoort Platinum Exploration Project in South Africa</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">From the existing exploration information together with the recently completed high resolution airborne Geophysics and Soil Chemical Programs identify and drill possible &nbsp;extensions to the known ore zones on the Eersteling and Zandrivier Mining Licence areas</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Conclude an agreement with a cobalt end producer to purchase cobalt concentrate produced at Nama or possibly form a strategic alliance to achieve this objective</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Confirm the feasibility of producing an economic cobalt concentrate from the Nama property in Zambia. Construct a pilot plant at Nama to produce a cobalt concentrate for testing</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Seek a joint-venture partner to commence an exploration program at the Kadola copper/cobalt and the Eureka copper/gold properties in Zambia</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Expand the Board of Directors to address ongoing Corporate Governance requirements</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Implement succession plans for senior executive and operational staff</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Strengthen the Investor Relations and Public Relations functions within Caledonia</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">List Caledonia on the London Stock Exchange Alternative Investment Market (&quot;AIM&quot;)</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; line-height:13pt; font-family:Wingdings; font-size:11pt" align="left"><font face="Arial">Arrange necessary financing to support the activities required to meet these objectives:</font></li>
</ul>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=626.4><P style="margin-top:4pt; margin-bottom:4pt; font-family:Shruti; font-size:12pt; color:#FFFFFF" align="left"><B><font face="Arial">PERFORMANCE HIGHLIGHTS</font></B></P>
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<TR><TD style="border-left: 1 solid #000000; border-right: 1 solid #000000; border-top: 1 solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><font face="Arial">&nbsp;</font></TD><TD style="border-right: 1 solid #000000; border-top: 1 solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=59.267><P style="line-height: 100%; font-family: Shruti; font-size: 7pt; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=center><B><font face="Arial">2004<font color="#FFFFFF"><sup>(2)</sup></font></font></B></P>
    <P style="line-height: 100%; font-family: Shruti; font-size: 7pt; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=center>&nbsp;</P>
</TD><TD style="border-right: 1 solid #000000; border-top: 1 solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=84>
<P style="line-height: 9pt; font-family: Shruti; font-size: 7pt; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=center><B><font face="Arial">2003<SUP>(2)</SUP></font></B></P>
<P style="line-height: 9pt; font-family: Shruti; font-size: 7pt; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align=center>&nbsp;</P>
</TD><TD style="border-right: 1 solid #000000; border-top: 1 solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=74.867>
<P style="line-height: 9pt; font-family: Shruti; font-size: 7pt; margin-top: 0pt; margin-bottom: 0" align=center><B><font face="Arial">2002<SUP>(2)</SUP></font></B></P>
<P style="line-height: 9pt; font-family: Shruti; font-size: 7pt; margin-top: 0pt; margin-bottom: 0" align=center>&nbsp;</P>
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<P style="line-height: 9pt; font-family: Shruti; font-size: 7pt; margin-top: 0pt; margin-bottom: 0" align=center><B><font face="Arial">2001<SUP>(2)</SUP></font></B></P>
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<P style="line-height: 9pt; font-family: Shruti; font-size: 7pt; margin-top: 0pt; margin-bottom: 0" align=center><B><font face="Arial">2000<SUP>(2)</SUP></font></B></P>
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<TR><TD style="border-left:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:0.8pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">Financial &#150; C$ 000&#146;s</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial">&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:0.8pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:0.8pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:0.8pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Revenue from Sales</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">841</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">646&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">27</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">124</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">6,623</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Gross Profit (Loss)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">(5,610)</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">(2,984)&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">(118)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">(143)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">284</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin-top:0pt; margin-bottom:1.7pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Expenses (General and Administration, &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest and Amortization)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">2,959</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">1,841&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">1,585</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">1,130</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">2,143</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Net Income (Loss) &#150; before Write-Downs</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">(8,917)</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">(4,737)&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">(1,856)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">(1,096)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">7,451</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Net Income (Loss) - after Write-Downs</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">(9,979)</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">(14,496)&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">(4,446)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">(1,096</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">7,451</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Cash</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">6,470</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">4,179&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">1,864</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">90</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">75</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Current Assets</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">7,481</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">4,573&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">2,094</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">184</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">200</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Assets</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">23,666</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">19,530&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">24,969</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">25,183</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">25,273</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Current Liabilities</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">1,062</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">790&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">1,336</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">2,701</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">2,556</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Long Term Liabilities</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">423</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">1,089&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">1,073</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">1,499</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">1,598</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Working Capital (Deficiency)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">6,419</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">3,783</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">758</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">(2,517)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">(2,356)</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Shareholders&#146; Equity</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">22,181</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">17,651</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">22,560</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">20,983</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">21,119</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Total Capital Expenditures including Mineral</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">3,813</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">2,279&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">613</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">23</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">120</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Expenditures on Mineral Properties</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">2,298</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">2,042&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">624</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">23</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">120</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Financing Raised</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">14,314</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">9,511&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">5,174</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">1,078</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">979</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">Share Information</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Market Capitalization ($ Thousands)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">39,145</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">105,955&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">86,836</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">9,086</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">10,374</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Shares Outstanding (Thousands)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">301,112</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">252,274</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">211,795</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">165,202</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">148,202</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Warrants &amp; Options (Thousands)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">52,342</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">27,348</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">28,055</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">19,566</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">7,566</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Earnings (Loss) per Share</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">(0.03)</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">(0.06)&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">( 0.02)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">( 0.01)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">&nbsp;0.08</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">TSE Share Price High</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">0.465</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">0.610</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">&nbsp;0.44</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">&nbsp;0.09</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">&nbsp;0.35</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">TSE Share Price Low</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">0.12</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">0.215</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">&nbsp;0.060</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">&nbsp;0.04</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">&nbsp;0.05</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">TSE Share Volume (Thousands)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">56,934</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">99,233</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">81,234</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">22,310</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">22,939</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">NASDAQ Share Price High (US$)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">0.37</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">0.39</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">&nbsp;0.281</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">&nbsp;0.06</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">&nbsp;0.18</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">NASDAQ Share Price Low (US$)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">0.10</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">0.16</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">&nbsp;0.040</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">&nbsp;0.02</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">&nbsp;0.03</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">NASDAQ Share Volume (Thousands)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">210,251</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">440,811&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">271,404</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">74,714</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">61,919</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">Operating Results<SUP> (1)</SUP></font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Gold Production (Ounces)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">1,693</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">1,187&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">52</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">114</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">14,558</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Silver Production (Ounces)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">66</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">42&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">4</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">-</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">122,665</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Average Cost per Ounce Gold (US $) Sold</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:9pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">2,310</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:9pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">3,129</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">-</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">-</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">240</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:1.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Average Revenue per Ounce Gold (US $) Sold</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">415</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right>&nbsp;</P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">402&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">-</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">-</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><B><font face="Arial">&nbsp;</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">285</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=bottom width=226.533><P style="margin:0pt; text-indent:1.1pt; line-height:6pt; font-family:Shruti; font-size:7pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.7pt; line-height:7.55pt; font-family:Shruti; font-size:7pt"><font face="Arial">Year End Gold Resource (Thousand Ounces)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=59.267><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><B><font face="Arial">2,459</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=84><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">2,478&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=74.867><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">2,489</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=82.2><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">2,930</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=bottom width=92.6><P style="margin:0pt; text-indent:7.1pt; line-height:6pt; font-family:Shruti; font-size:7pt">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:1.7pt; text-indent:7.1pt; line-height:7.55pt; font-family:Shruti; font-size:7pt" align=right><font face="Arial">2,930</font></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin-top:0pt; margin-bottom:-10pt; padding-left:41.85pt; text-indent:-18pt; line-height:10pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial">(1)</font></P>
<P style="margin:0pt; padding-left:41.85pt; text-indent:-5.85pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial">Filon Sur to June 30 for year 2000 only.</font></P>
<P style="margin-top:0pt; margin-bottom:-10pt; padding-left:41.85pt; text-indent:-18pt; line-height:10pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial">(2)</font></P>
<P style="margin:0pt; padding-left:41.85pt; text-indent:-5.85pt; line-height:10pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial">Restated for the adoption of the Asset Retirement Obligations change in accounting policy</font></P>
<P style="margin:0pt; line-height:16pt; font-family:Shruti; font-size:14pt">&nbsp;</P>
<P style="margin:0pt; line-height:16pt; font-family:Shruti; font-size:14pt">&nbsp;</P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; line-height:16pt; font-family:Shruti; font-size:14pt">&nbsp;</P>
<P style="margin:0pt; line-height:16pt; font-family:Shruti; font-size:14pt">&nbsp;</P>
<P style="margin:0pt; line-height:16pt; font-family:Shruti; font-size:14pt" align="left"><B><I><U><font face="Arial">Letter to Shareholders</font></U></I></B></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">2004 has been another challenging yet exciting year for Caledonia as we work towards bringing the Barbrook Gold Mine into profitable gold production and consolidate work on our exciting Nama Cobalt/Copper Deposit in Zambia. &nbsp;While the macro-economic environment in South Africa continues to be favourable, the overall outlook for commodity prices is positive and a stronger rand has had a negative impact on the South African mining industry.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Work at the Barbrook Gold Mine in South Africa continues to focus on optimizing the metallurgical circuit and proving up additional reserves and resources to establish a sustainable and profitable production base. &nbsp;Following improvements achieved during 2004, and further enhancements planned for 2005, we remain confident that we will be able to return Barbrook to economic gold production during 2005, despite the strong rand. &nbsp;Extensive modifications have been made to the metallurgical circuit to improve gold recovery from the complex refractory sulphide ore body. &nbsp;Following these changes, there has been a significant improvement in the operating efficiency in the resin-in-leach (&#147;RIL&#148;) section with a corresponding increase in gold recovery to above 80%. This should result in an immediate increase in tonnage throughput to between 7,000 and 8,000 tonnes per month. The full impact and sustainability of the above 
changes will be determined in March 2005 when all of the process changes are complete. &nbsp;Metallurgical test work continued on a number of different process alternatives including Ultra-fine milling, Dense Media Separation and Biox&#174;. &nbsp;A decision on whether to implement the Biox&#174; plant and/or Ultra-fine milling and/or Dense Media Separation is anticipated in the first half of 2005. &nbsp;&nbsp;&nbsp;</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Exploration work continued at the Rooipoort Platinum Project, south of Mokopane (previously Potgietersrus) with the completion of a stratigraphic diamond drill program and in November the initial drilling program, which is intended to define an indicated PGM resource at Rooipoort commenced. &nbsp;Recent exploration results show that the mineralization is closer to surface near the northern, and extreme southern property boundaries and drilling is now concentrating in these areas. Caledonia also purchased an additional 342 hectares of mineral and prospecting rights on the farm Grasvally adjacent to the Rooipoort property to the south. &nbsp;We believe Grasvally to be highly prospective as the mineralization in this area appears to be near surface with a shallow dip. &nbsp;Caledonia&#146;s application for the necessary Prospecting Permit from the Department of Minerals and Energy, which was filed on April 23, 2004, was refused on March 
11, 2005 on the grounds only of not having a shareholders agreement in place with a black economic partner. &nbsp;Caledonia believes that this refusal has no basis in law and continues to actively pursue this permit by all available means</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Caledonia subscribes to the Black Economic Empowerment (&#147;BEE&#148;) legislation, which was introduced to reverse previous discriminatory practices in South Africa, and is actively seeking suitable BEE partners for its South African operations in the strong conviction that, in the long term, this approach will add significant value for Caledonia shareholders. &nbsp;We hope to update shareholders on progress in this regard during the course of 2005.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Our exciting cobalt project Nama, in northern Zambia, has made steady progress. &nbsp;Nama could be one of the largest primary cobalt deposits in the world. &nbsp;Encouraging results from the mini bulk sample have been received. The sample was tested at MINTEK&#146;s laboratory in South Africa and confirmed that a suitable cobalt concentrate can be extracted. &nbsp;In 2005 a larger tonnage sample will be excavated and will be processed through a pilot plant to be built on site in order to produce a suitable cobalt concentrate for testing through a smelter or hydrometallurgical plant. &nbsp;If this test is successful and satisfactory economic terms are obtained, it is expected that a long-term supply contract for the Nama cobalt/copper concentrate could be negotiated with a large cobalt user or users. &nbsp;The entering into a joint venture with a suitable partner to assist developing this project further during 2005 is being investiga
ted.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">At the Mulonga Plain Diamond Project in Zambia and the Kikerk Lake Diamond Venture in Northern Canada our joint venture partners have continued their obligation to fund the exploration programs. &nbsp;Based on the results of a 5,000 line km Falcon&#174; airborne gravity and magnetic survey, flown over the identified kimberlite mineral clusters located in the most eastern portion of the Mulonga licence area, a drilling budget of US$520,000 has been allocated to follow up the identification of the targets derived from previous work and the 71 gravity anomalies identified by the preliminary interpretation of the Falcon&#174; data. At Kashiji Plain, a number of samples were collected and are currently undergoing laboratory work. &nbsp;Budget allocation and planning for 2005 has been deferred until these analyses are complete. &nbsp;Caledonia&#146;s interest in Mulonga Plain remains 40%.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify>&nbsp;</P>
<P style="margin:0pt; font-family:Shruti" align=justify>&nbsp;</P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Caledonia continues to believe the gold price will maintain its upward trend in the near term. &nbsp;The US$ gold price has continued to rise, reaching in excess of US$450 per ounce in December 2004. Caledonia management believes that gold bullion and gold shares remain in a long-term bull market. To maximise the benefit of the current strong price Caledonia has decided to remain unhedged. &nbsp;It should be noted, however, that the South African Rand gold price has decreased slightly due to ongoing Rand currency strength. As Barbrook&#146;s operating costs are in Rand this continues to hamper the project economics.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Turning to the financial performance of the company Caledonia continues to be debt free having raised $14.3 million from private placements and exercise of options and warrants. &nbsp;During 2004 the company suffered a loss of $10.0 million which included an operating loss of $5.6 million and a write&#150;down of mineral properties of $1.1 million. &nbsp;$3.8 million was invested in capital assets and mineral properties in South Africa. &nbsp;Cash available at year end totalled $6.5 million</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Caledonia plans during 2005 to list the company&#146;s shares on the Alternative Investment Market in London, England in conjunction with a financing. &nbsp;The Board believes this listing will introduce Caledonia to London&#146;s institutional investors, offer Caledonia greater market exposure, and further broaden the shareholder base, ultimately benefiting all shareholders.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">I am delighted to welcome two new non-executive members to the Board, Rupert Pardoe and Roland Fasel. &nbsp;Mr Pardoe was elected non-executive Chairman in February 2005. &nbsp;These two individuals bring additional experience to the Board, particularly in the sphere of corporate governance as both are independent of management. &nbsp;This year, the company will focus on implementing succession plans for senior executive and operational staff, as well as expand the Board of Directors to address ongoing Corporate Governance requirements.</font> </P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">The future for Caledonia shareholders is promising, as the company is uniquely positioned to develop its gold production and diverse base metals projects, platinum exploration programs and the diamond joint venture exploration projects. &nbsp;The further strengthening of its Board of Directors should also show benefits in ensuring that the company meets its Corporate Governance and Strategic objectives.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Finally, my thanks go to Caledonia&#146;s management, directors, staff, joint venture partners, and particularly to our shareholders for supporting Caledonia during the challenges and opportunities of another year. &nbsp;The management and directors look forward to your continued confidence as we work diligently towards the objective of building Caledonia into a significant diversified international mining company.</font></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial">On behalf of the Board of Directors,</font></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">(signed)</font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><B>S. E. Hayden </B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Johannesburg, 18<SUP>th</SUP> March 2005</font> </P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">President and Chief Executive Officer</font></P>
<p align="left"><font face="Arial">
<BR>
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<p align="left"><font face="Arial">
<BR>
<BR>
<BR>
</font>
<P style="margin-top:0pt; margin-bottom:-9.55pt; padding-left:-27pt; line-height:9.55pt; font-family:Shruti" align="left"><B><font face="Arial">CALEDONIA MINING CORPORATION</font></B></P>
<P style="margin-top:0pt; margin-bottom:1.15pt; padding-left:-27pt; text-indent:207pt; line-height:7.55pt; font-family:Shruti" align="left"><B><font face="Arial">March 18, 2005</font></B></P>
<P style="margin:0pt; padding-left:-27pt; line-height:16pt; font-family:Shruti; font-size:14pt" align="left"><B><font face="Arial">Management&#146;s Discussion and Analysis</font></B></P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti" align=justify><font face="Arial">This discussion and analysis of the consolidated operating results and financial condition of the Caledonia Mining Corporation (the &#147;Company&#148;, &#147;Caledonia&#148;) for the fiscal years ended December 31, 2004 and December 31, 2003 should be read in conjunction with the Consolidated Financial Statements and the Annual Information Form and Press Releases issued by the company, all of which are available &nbsp;from the System for Electronic Data Analysis and Retrieval at <FONT COLOR=#0000FF><U>www.sedar.com</U></FONT> or from the Company website at <FONT COLOR=#0000FF><U>www.caledoniamining.com</U></FONT>.website. The Consolidated Financial Statements and related notes have been prepared in accordance with Canadian Generally Accepted Accounting Principles (&#147;GAAP&#148;).</font></P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti" align=justify><font face="Arial">Caledonia was formed in February 1992 and is listed on the Toronto Stock Exchange as &#147;CAL&#148; and on NASDAQ-OTCBB as &#147;CALVF&#148;.</font></P>
<P style="margin-top:0pt; margin-bottom:1.15pt; line-height:7.55pt; font-family:Shruti" align=center><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=626.4><P style="margin-top:4pt; margin-bottom:4pt; padding-left:-27pt; line-height:7.55pt; font-family:Shruti; font-size:12pt; color:#FFFFFF" align=justify><font face="Arial">VIS<b>IVISION and STRATEGY</b></font></P>
</TD></TR>
</TABLE>
<P style="margin-top:0pt; margin-bottom:1.15pt; padding-left:-27pt; line-height:7.55pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti" align=justify><font face="Arial">Caledonia is an exploration, development and mining company with a gold operation in South Africa and a diversified exploration portfolio of projects in Canada, South Africa and Zambia, &nbsp;&nbsp;some of which are joint ventures. &nbsp;Caledonia&#146;s objective is to develop the asset base into a significant diversified international mining company through profitable gold production and successful exploration activity, focused primarily on Southern Africa.</font></P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti" align=justify><font face="Arial">Caledonia&#146;s business model is to identify and acquire properties or projects early in the development cycle, which have the potential to become low cost operations, and then add value by developing the asset, either as an operator or through a joint venture agreement. &nbsp;The possibility of divestiture in whole or part will be considered at different points in time on the valuation curve and will be governed by the benefit to shareholders. &nbsp;Where appropriate, Caledonia will seek strategic alliances with well-managed exploration or operating companies through existing or new joint ventures.</font></P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti" align=justify><font face="Arial">The Company has a strong management team and Board of Directors with diverse expertise in gold production, mineral exploration, mine development, finance and marketing.</font> </P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti" align=justify><font face="Arial">With the expectation of continuing improvements in commodity prices over the long term, Caledonia is following the strategy of diversification through its current exploration activities for diamonds, gold, platinum group metals and base metals. With the potential of improved political conditions in many Southern African countries, Caledonia is reviewing mining opportunities in these countries. &nbsp;</font></P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti" align=justify>&nbsp;</P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=667.2><P style="margin-top:4.65pt; margin-bottom:4.65pt; line-height:16pt; font-family:Shruti; font-size:14pt; color:#FFFFFF"><font face="Arial">CORE BUSINESSES</font></P>
</TD></TR>
</TABLE>
<P style="font-family: Times New Roman; font-size: 12pt; text-indent: 0; margin: 0pt" align="left"><font face="Arial"><BR></font></P>
<P style="text-indent: 0; line-height: 14pt; font-family: Shruti; font-size: 12pt; margin: 0pt" align="left"><font face="Arial">GOLD MINING</font></P>
<P style="text-indent: 0; line-height: 14pt; font-family: Shruti; font-size: 12pt; margin: 0pt" align="left"><B><font face="Arial">Barbrook Mines Limited</font></B></P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti" align=justify><font face="Arial">The 100% owned Barbrook Mines Limited (&#147;Barbrook&#148;) is located near the historic gold-mining town of Barberton in the Mpumalanga province of the Republic of South Africa, approximately 375 km west of Pretoria and Johannesburg. &nbsp;Barberton has a history of gold mining dating back more than 100 years. The Barbrook property, which covers an area of 10,625 acres and extends for a distance of about 28 km along strike, represents a consolidation of approximately 20 previously worked gold mines.</font></P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti" align=justify><font face="Arial">The Barbrook gold deposits occur in the Barberton Greenstone belt, the host for the other gold deposits in the area. The belt is of Archean age and includes some of the oldest volcanic and sedimentary rocks in South Africa. &nbsp;The belt trends southwest to the northeast and has been intruded and deformed by various granite plutons at the margins. The Barbrook property covers two steeply-dipping, banded iron formations oriented in an east-west direction. &nbsp;These two shear zones, called the Zwartkoppie and Barbrook lines, are the host to the Barbrook gold deposits. &nbsp;The gold mineralization at Barbrook is complex, the gold is generally extremely fine-grained, associated with refractory minerals such as pyrite and arsenopyrite, and contains significant concentrations of
&quot;preg-robbing&quot; organic carbon.</font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<p align="left">&nbsp;
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt">&nbsp;</P>
<P style="margin:0pt; padding-left:-27pt; font-family:Shruti" align=justify><font face="Arial">Mining at Barbrook is from underground using an open-stope, sub-level benching method. &nbsp;Broken ore is transported to the surface crushing area along the main 10 level haulage way. &nbsp;At present all workings are on or between 7 level and the main 10 level haulage. &nbsp;A decline shaft is currently in development on the French Bob&#146;s ore zone to access the ore block below 10 level.</font></P>
<P style="margin:0pt; text-indent:-27pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:-27pt; font-family:Shruti" align="left"><font face="Arial">The
Barbrook Mine gold reserves and resources are as follows:</font></P>
<P style="margin:0pt; text-indent:-27pt; font-family:Shruti" align="left">&nbsp;</P>
<P style="margin:0pt; text-indent:-27pt; font-family:Shruti" align="left">&nbsp;</P>
<TABLE width="687" border=0 cellspacing=0 cellpadding=0>
<TR>
   <TD width="1017" colspan="7" valign="middle" style="border: 1 solid #000000">
<P align="center" style="margin-top: 0; margin-bottom: 0">
&nbsp;
</P>
<P align="center" style="margin-top: 0; margin-bottom: 0">
<b><font size="2" face="Arial">GOLD RESERVES &amp; RESOURCES (Undiluted) &#150; as at December 31, 2004</font></b>
</P>
<p align="center" style="margin-top: 0; margin-bottom: 0"><font color="#FFFFFF">--</font>
   </TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="64"></TD>
   <TD width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="24"></TD>
   <TD width="237"></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" style="border-right: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
</TR>
<TR>
   <TD width="400" align="center" style="border-left: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="64" align="center"></TD>
   <TD width="128" align="center" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="24" align="center"></TD>
   <TD width="237" align="center"></TD>
   <TD width="6" align="center" style="border-right: 1 solid #000000"></TD>
   <TD width="160" align="center" style="border-right: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
</TR>
<TR>
   <TD width="400" align="center" style="border-left: 1 solid #000000; border-bottom: 1 solid #000000">
<B><FONT size=2 face="Arial">Category</FONT></B>
   </TD>
   <TD width="64" align="center" style="border-bottom: 1 solid #000000"><font face="Arial">&nbsp;</font></TD>
   <TD width="128" align="center" style="border-left: 1 solid #000000; border-right: 1 solid #000000; border-bottom: 1 solid #000000">
    <p align="center"><B><FONT size=2 face="Arial">Tonnes *</FONT></B></p>
   </TD>
   <TD width="24" align="center" style="border-bottom: 1 solid #000000"><font face="Arial">&nbsp;</font></TD>
   <TD width="237" align="center" style="border-bottom: 1 solid #000000"><B><FONT size=2 face="Arial">Gold Grade
    grams/tonne</FONT></B></TD>
   <TD width="6" align="center" style="border-right: 1 solid #000000; border-bottom: 1 solid #000000"></TD>
   <TD width="160" align="center" style="border-right: 1 solid #000000; border-bottom: 1 solid #000000"><font face="Arial">&nbsp;<B><FONT size=2 face="sans-serif">Gold Ounces </FONT></B>
    </font></TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><B><U><FONT size=2 face="Arial">RESERVES</FONT></U></B></TD>
   <TD width="64"><font face="Arial">&nbsp;</font></TD>
   <TD width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><font face="Arial">&nbsp;</font></TD>
   <TD width="24"><font face="Arial">&nbsp;</font></TD>
   <TD width="237"><font face="Arial">&nbsp;</font></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" style="border-right: 1 solid #000000"><font face="Arial">&nbsp;</font></TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><FONT size=2 face="Arial">Proven</FONT></TD>
   <TD width="64"><font face="Arial">&nbsp;</font></TD>
   <TD align="right" width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><FONT size=2 face="Arial">191,200</FONT></TD>
   <TD width="24"><font face="Arial">&nbsp;</font></TD>
   <TD width="237" align="center"><FONT size=2 face="Arial">5.87</FONT></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" align="right" style="border-right: 1 solid #000000"><font face="Arial">&nbsp;<FONT size=2 face="sans-serif">36,078</FONT>
    </font></TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><FONT size=2 face="Arial"> Probable</FONT>
   </TD>
   <TD width="64"><font face="Arial">&nbsp;</font></TD>
   <TD align="right" width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><u><FONT size=2 face="Arial">44,947</FONT></u></TD>
   <TD width="24"><font face="Arial">&nbsp;</font></TD>
   <TD width="237" align="center"><FONT size=2 face="Arial">6.29</FONT></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" align="right" style="border-right: 1 solid #000000"><font face="Arial">&nbsp;<U><FONT size=2 face="sans-serif">9,097</FONT></U>
    </font></TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="64" align="center"><B><u><FONT size=2 face="Arial">Total</FONT></u></B></TD>
   <TD align="right" width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><B><u><FONT size=2 face="Arial">236,147</FONT></u></B></TD>
   <TD width="24"><font face="Arial">&nbsp;</font></TD>
   <TD width="237" align="center"><B><u><FONT size=2 face="Arial">5.95</FONT></u></B></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" align="right" style="border-right: 1 solid #000000"><font face="Arial">&nbsp;<B><U><FONT size=2 face="sans-serif">45,175</FONT></U></B>
    </font></TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="64" align="center"><font face="Arial">&nbsp;</font></TD>
   <TD width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><font face="Arial">&nbsp;</font></TD>
   <TD width="24"><font face="Arial">&nbsp;</font></TD>
   <TD width="237" align="center"><font face="Arial">&nbsp;</font></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" align="right" style="border-right: 1 solid #000000"><font face="Arial">&nbsp;</font></TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><B><U><FONT size=2 face="Arial">RESOURCES</FONT></U></B></TD>
   <TD width="64" align="center"><font face="Arial">&nbsp;</font></TD>
   <TD width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><font face="Arial">&nbsp;</font></TD>
   <TD width="24"><font face="Arial">&nbsp;</font></TD>
   <TD width="237" align="center"><font face="Arial">&nbsp;</font></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" align="right" style="border-right: 1 solid #000000"><font face="Arial">&nbsp;</font></TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><FONT size=2 face="Arial">Measured</FONT>
   </TD>
   <TD width="64" align="center"><font face="Arial">&nbsp;</font></TD>
   <TD align="right" width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><FONT size=2 face="Arial">463,954</FONT></TD>
   <TD width="24"><font face="Arial">&nbsp;</font></TD>
   <TD width="237" align="center"><FONT size=2 face="Arial">2.93</FONT></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" align="right" style="border-right: 1 solid #000000"><font face="Arial">&nbsp;<FONT size=2 face="sans-serif">43,635</FONT>
    </font></TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><FONT size=2 face="Arial"> Indicated</FONT>
   </TD>
   <TD width="64" align="center"><font face="Arial">&nbsp;</font></TD>
   <TD align="right" width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><FONT size=2 face="Arial">1,240,501</FONT></TD>
   <TD width="24"><font face="Arial">&nbsp;</font></TD>
   <TD width="237" align="center"><FONT size=2 face="Arial">5.36</FONT></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" align="right" style="border-right: 1 solid #000000"><font face="Arial">&nbsp;<FONT size=2 face="sans-serif"> 213,695</FONT>
    </font></TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><FONT size=2 face="Arial"> Inferred</FONT>
   </TD>
   <TD width="64" align="center"><font face="Arial">&nbsp;</font></TD>
   <TD align="right" width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><u><FONT size=2 face="Arial">8,781,652</FONT></u></TD>
   <TD width="24"><font face="Arial">&nbsp;</font></TD>
   <TD width="237" align="center"><FONT size=2 face="Arial">5.76</FONT></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" align="right" style="border-right: 1 solid #000000"><font face="Arial">&nbsp;<U><FONT size=2 face="sans-serif">1,626,145</FONT></U>
    </font></TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="64" align="center"><B><u><FONT size=2 face="Arial">Total</FONT></u></B></TD>
   <TD align="right" width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><B><u><FONT size=2 face="Arial">10,486,107</FONT></u></B></TD>
   <TD width="24"><font face="Arial">&nbsp;</font></TD>
   <TD width="237" align="center"><B><u><FONT size=2 face="Arial">5.59</FONT></u></B></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" align="right" style="border-right: 1 solid #000000"><font face="Arial">&nbsp;<B><U><FONT size=2 face="sans-serif">1,883,475</FONT></U></B>
    </font></TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="64"><font face="Arial">&nbsp;</font></TD>
   <TD width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><font face="Arial">&nbsp;</font></TD>
   <TD width="24"><font face="Arial">&nbsp;</font></TD>
   <TD width="237" align="center"><font face="Arial">&nbsp;</font></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" align="right" style="border-right: 1 solid #000000"><font face="Arial">&nbsp;</font></TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="64"><font face="Arial">&nbsp;</font></TD>
   <TD align="right" width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><B><u><FONT size=2 face="Arial">10,722,254</FONT></u></B></TD>
   <TD width="24"><font face="Arial">&nbsp;</font></TD>
   <TD width="237" align="center"><B><u><FONT size=2 face="Arial">5.59</FONT></u></B></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" align="right" style="border-right: 1 solid #000000"><font face="Arial">&nbsp;<B><U><FONT size=2 face="sans-serif">1,928,650</FONT></U></B>
    </font></TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="64"></TD>
   <TD align="right" width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="24"></TD>
   <TD width="237" align="center"></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" align="right" style="border-right: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><B><U><FONT size=2 face="Arial">Total Mineral Reserves &amp; Resources</FONT></U></B>
   </TD>
   <TD width="64"></TD>
   <TD align="right" width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="24"></TD>
   <TD width="237" align="center"></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" align="right" style="border-right: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="64"></TD>
   <TD align="right" width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="24"></TD>
   <TD width="237" align="center"></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" align="right" style="border-right: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
</TR>
<TR>
   <TD width="400" style="border-left: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="64"></TD>
   <TD align="right" width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="24"></TD>
   <TD width="237" align="center"></TD>
   <TD width="6" style="border-right: 1 solid #000000"></TD>
   <TD width="160" align="right" style="border-right: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
</TR>
<TR>
   <TD width="464" colspan="2" style="border-left: 1 solid #000000; border-bottom: 1 solid #000000">
<P>
<font face="Arial">
<B><FONT size=1>*</FONT></B>&nbsp;<B><FONT size=1 face="sans-serif">1 Tonne = 1,000 kilograms = 2,204.6 pounds</FONT></B>
</font>
</P>
   </TD>
   <TD align="right" width="128" style="border-left: 1 solid #000000; border-right: 1 solid #000000; border-bottom: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="24" style="border-bottom: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="237" align="center" style="border-bottom: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
   <TD width="6" style="border-right: 1 solid #000000; border-bottom: 1 solid #000000"></TD>
   <TD width="160" align="right" style="border-right: 1 solid #000000; border-bottom: 1 solid #000000"><font color="#FFFFFF">-</font></TD>
</TR>
</TABLE>
<P style="margin:0pt; text-indent:-27pt; font-family:Shruti" align="left">&nbsp;</P>
<P style="margin:0pt; text-indent:-27pt; font-family:Shruti" align="left">&nbsp;</P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt">&nbsp;</P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font face="Arial">Mr. David Grant, C.Geol., FGS, Pr.Sci.Nat., an independent consultant is the &#147;Independent Qualified Person&#148; for Barbrook&#146;s reserves and resources as required by National Instrument 43-101 of the Canadian Securities Administrators.</font> </P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font face="Arial">In the metallurgical processing plant, the broken ore is de-slimed, crushed to minus 13mm size and stored in a coarse ore storage bin. &nbsp;From this bin, ore is conveyed to the 250 kW Vecor primary ball mill, with its associated flash flotation cell. This flash flotation cell recovers up to 70% of the gold in the mill feed. The milled ore passes to the flotation plant which includes a second flash cell, scavenger, cleaner and recleaner circuits. &nbsp;The combined flotation concentrate with a gold grade of between 30 to 40 g/t is processed through a combined gravity/cyclone plant to remove most of the organic carbon that previously caused metallurgical problems in gold recovery. The organic carbon is discarded with the main flotation tailings. The &#147;carbon-free&#148; concentrate is re-ground in the Sala 90 kW regrind mill to produce a product of about 95% -25 microns This fine-milled concentrate is pumped to t
he 2-stage, newly developed Aachen pre-oxidation circuit where oxygen gas is added to satisfy the high oxygen demand of the fine sulphide concentrate. Lime is then added to increase the pH to above 10 and thence the treated slurry is pumped to the resin-in-leach (RIL) circuit. Gold is recovered from the loaded resin in the elution and electrowinning circuits located in the smelt house. This produces high-grade gold bullion bars that are sent to a South African refinery for further processing and sale of gold.</font></P>
<P style="margin:0pt; text-indent:21.3pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font face="Arial">The present metallurgical circuit, as designed can readily treat between 8,000 to 10,000 tonnes per month. &nbsp;This throughput is planned to be increased to 10,000 tonnes per month as the underground and stope development progresses and provides greater mining flexibility. The on-site, un-utilized as yet, 1300 kW drive Vecor ball milling circuit is designed to process sulphide ore at the rate of 25,000 tonnes per month. Tailings are pumped to the tailings deposition area located about 3km from the mine site. &nbsp;Tailings deposition operations are managed by a licensed contractor and are fully compliant with all requisite legislation and codes of practice.</font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font face="Arial">There is a full mine infrastructure at Barbrook including administration areas, change-house, lamp room, security barracks, training and first aid rooms, mine stores, engineering/maintenance workshops, assay and metallurgical laboratories, explosive magazines and the tailings deposition area. &nbsp;</font></P>
<p align="left">&nbsp;
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
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<P style="margin:0pt; font-family:Shruti; font-size:12pt">&nbsp;</P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; line-height:14pt; font-family:Shruti; font-size:12pt" align="left"><B><font face="Arial">Eersteling Gold Mining Company Limited</font></B></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font face="Arial">The 100% owned Eersteling Gold Mining Company Limited (&#147;Eersteling&#148;) is located 36 km south of the city of Polokwane in Limpopo Province of the Republic of South Africa, 300 km north of Johannesburg.</font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font face="Arial">The Eersteling Mine property has an area of 47,000 acres (19,020 hectares), extends for a distance of about 25 km and is located in the Pietersburg Greenstone belt which is of Archean age consisting of an upper and lower sequence. &nbsp;The upper sequence is mainly conglomerate, grit and sandstone and the lower sequence is undifferentiated mafic and ultramafic volcanic rocks and intrusives, with banded iron formation and chert. &nbsp;The Willemse shear feature most dominates gold mineralization in the Eersteling area.</font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font face="Arial">Eersteling listed on the JSE Securities Exchange South Africa on July 16 1987. &nbsp;In June 2004, due to the illiquidity of trading and the high cost of maintaining the listed company, Caledonia redeemed the 3.6% of minority shareholders and subsequently de-listed Eersteling from the JSE.</font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font face="Arial">The Eersteling mine has been on care and maintenance since early 1997 when production was suspended due to low gold prices. &nbsp;Despite the high US dollar gold price, the strong rand and rand gold price have prevented the mine being returned to production at an economic level. &nbsp;In 2002 Eersteling applied for its required Section 9 permanent mining licence which was granted during April 2003. &nbsp;Caledonia intends, subject to a sustainable economic rand gold price and favourable Eersteling/Roodepoort exploration results, to re-commence commercial production at Eersteling in the future.</font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font face="Arial">The Eersteling Mine gold resource estimate based on the 1997 data before the mine was placed on a care and maintenance is as follows:</font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify>&nbsp;</P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify>&nbsp;</P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify>&nbsp;</P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border: 0.75pt solid #000000" valign=top width=529.2 colspan=4><P style="margin:0pt; font-family:Shruti" align=center>&nbsp;</P>
<P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">GOLD RESOURCES (Undiluted) - as at December 31, 2004</font></B></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=top width=168.667><P style="margin:0pt; text-indent:1.1pt; line-height:0.95pt; font-family:Shruti" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:1.1pt; font-family:Shruti" align=center><B><font face="Arial">Resource category</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=98.8><P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">Tonnes</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=141.733><P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">Gold Grade g/tonne</font></B></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #000000" valign=top width=120><P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">Gold Ounces</font></B></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=top width=168.667><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti"><font face="Arial">Measured</font></P>
<P style="margin:0pt; text-indent:1.1pt; font-family:Shruti"><font face="Arial">Indicated</font></P>
<P style="margin:0pt; text-indent:1.1pt; font-family:Shruti"><font face="Arial">Inferred</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=98.8><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">60,527</font></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">537,232</font></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,048,961</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=141.733><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">7.43</font></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">7.78</font></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">5.79</font></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #000000" valign=top width=120><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">14,457</font></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">134,382</font></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">381,600</font></P>
</TD></TR>
<TR><TD style="border-left: 0.75pt solid #000000; border-right: 0.75pt solid #000000; border-bottom: 0.75pt solid #000000" valign=top width=168.667><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti"><B><font face="Arial">Total Mineral &nbsp;Resource</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=98.8><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">2,646,720</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=141.733><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">6.23</font></B></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #000000" valign=top width=120><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">530,439</font></B></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">The above resource estimate is historic and the company does not consider this estimate to be a defined resource in terms of National Instrument 43-101. The Company has not completed the work necessary to verify the classification of the resource in terms of National Instrument 43-101 and as such the historic estimate should not be relied upon.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Eersteling has a number of exploration prospects on its mineral holdings, including the Roodepoort Gold Exploration Project and the Rooipoort Platinum Exploration Project. &nbsp;These are detailed further in the Exploration section of this report.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">There is a full mine infrastructure at Eersteling including administration areas, change-house, lamp room, security barracks, training and first aid rooms, mine stores, engineering/maintenance workshops, assay and metallurgical laboratories, explosive magazines and a licensed tailings deposition area. &nbsp;&nbsp;In the event that gold-mining operations resume at Eersteling these facilities will require some refurbishing prior to being returned to use.</font></P>
<P style="margin:0pt; font-family:Shruti; font-size:14pt" align=justify><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=674.4><P style="margin-top:4.65pt; margin-bottom:4.65pt; line-height:16pt; font-family:Shruti; font-size:14pt"><font color="#FFFFFF" face="Arial">MARKETING</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial">All gold bullion produced is refined by Rand Refinery in Germiston, South Africa and sold at spot at the discretion of the company to Absa Bank Limited in Johannesburg, South Africa under contract. The company nominates the currency of settlement for each individual sale.</font></P>
<p align="left">&nbsp;
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<P style="margin:0pt; font-family:Shruti; font-size:12pt">&nbsp;</P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=674.4><P style="margin-top:4.65pt; margin-bottom:4.65pt; line-height:16pt; font-family:Shruti; font-size:14pt"><font color="#FFFFFF" face="Arial">KEY PERFORMANCE FACTORS</font></P>
</TD></TR>
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<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">The key performance factor of a gold mine is the ability to produce gold at a cost per ounce that is low enough to pay all obligations and generate an acceptable return to shareholders. The price of gold is established in an international market and is considered a commodity. The future Rand price of gold plays a large part in determining the profitability of South African gold mines. During 2004, the South African Rand continued to strength by 14.8% against the United States dollar and this to a large extent negated the 6.6% increase in the US$ gold price, resulting in a 9.5% decrease in the Rand gold price per ounce over the year.</font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=674.4><P style="margin-top:4.65pt; margin-bottom:4.65pt; line-height:16pt; font-family:Shruti; font-size:14pt; color:#FFFFFF"><font face="Arial">CAPABILITY TO DELIVER RESULTS</font> </P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">The successful operation of mining and exploration depends on the presence of economic in-situ resources, the availability of experienced and skilled management and employees and financial resources to be able to carry out the work, and the support of the holding company.</font> </P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Caledonia initiated a human resources program focused on strengthening senior management. &nbsp;This program commenced in late 2003 and is detailed in the 2003 Annual Report. &nbsp;As an extension of this program to further strengthen the Board of Directors and Caledonia&#146;s management team, two additional appointments were made in 2004 and a further appointment in 2005: &nbsp;</font></P>
<ul>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Wingdings" align="justify"><font face="Arial">Mr. Mike Tombs was appointed Vice President Finance and Chief Financial Officer of the Corporation. &nbsp;He is based in the Johannesburg office.</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Wingdings" align="justify"><font face="Arial">Mr. Roland Fasel was appointed to the Caledonia Board of Directors in August 2004. &nbsp;Mr Fasel is a qualified accountant and a director of several public companies in Switzerland. &nbsp;He is based in Geneva, Switzerland. &nbsp;The addition of Mr Fasel strengthens the board, particularly in the area of Corporate Governance. Mr Fasel has been appointed to Caledonia&#146;s Audit Committee, which is now comprised entirely of independent directors, as recommended by the Toronto Stock Exchange.</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Wingdings" align="justify"><font face="Arial">Mr. Rupert Pardoe was appointed to the Caledonia Board of Directors and elected as non-executive Chairman, with immediate effect in February 2005. &nbsp;He is based in Johannesburg, South Africa. &nbsp;Mr Pardoe was previously Deputy Group Chief Executive of Absa Group Limited, the largest retail bank and financial services group in Southern Africa, which he joined in September 2001 after twenty years at Anglo American Corporation of South Africa Limited. &nbsp;Mr Pardoe brings to Caledonia a wealth of international business experience, particularly in the mining and financial sectors. &nbsp;With the election of Mr. Pardoe, Mr. Hayden relinquished his position as Chairman, thereby separating the posts of Chairman and CEO as recommended by the Toronto Stock Exchange.</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-7.65pt; font-family:Wingdings" align="justify"><font face="Arial">These two Board appointments bring the total number of independent Board directors to four.</font></li>
</ul>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">The financings of 2003 and of April/May 2004 enabled Caledonia to carry out the planned development of its projects into 2005. The 2003 financing also permitted Caledonia to pay off its debt to its officers and it is now completely debt free.</font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=590.4><P style="margin-top:7pt; margin-bottom:7pt; line-height:16pt; font-family:Shruti; font-size:14pt; color:#FFFFFF"><font face="Arial">CONSOLIDATED FINANCIAL RESULTS</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti" align=center><font face="Arial"><BR></font></P>
<P style="font-family: Shruti; text-indent: 0; margin: 0pt; padding-left: -9pt" align=justify><font face="Arial">For the year ended December 31, 2004, the Company recorded a net loss, after write downs, of $ 10,0 million ($0.034 per share) compared to a net loss of $14.5 million ($0.062 per share) in 2003 and a net loss of $4.4 million ($0.023 per share) in 2002. &nbsp;The loss in 2004 included a write down of mineral properties of $1.1 million and losses from operations of $5.6 million. &nbsp;There was a mineral property write down of $9.8 million in 2003 and $2.6 million in 2002. &nbsp;The loss from operating activities of $5.6 million has increased from $3.0 million in 2003 and $0.1 million in 2002 reflecting a higher level of activity associated with ongoing activities to refurbish the Barbrook operation. &nbsp;In 2004 general and administrative expense includes a charge of $0.2 million for stock option grant expense as compared to $0.1 million in 2003 and $0.2 million in 2002. &nbsp;</font></P>
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<P style="margin:0pt; font-family:Shruti; font-size:12pt">&nbsp;</P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=674.4><P style="margin-top:7pt; margin-bottom:7pt; line-height:16pt; font-family:Shruti; font-size:14pt; color:#FFFFFF"><font face="Arial">OPERATIONAL<FONT COLOR=#000000> REVIEW</FONT></font></P>
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<P style="margin:0pt; font-family:Shruti" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:12pt" align="left"><B><font face="Arial">Barbrook Mine</font></B></P>
<P style="line-height: 100%; font-family: Shruti; font-size: 12pt; text-indent: 0; margin: 0pt" align="left">&nbsp;</P>
<P style="line-height: 100%; font-family: Shruti; font-size: 12pt; text-indent: 0; margin: 0pt" align="left"><font face="Arial"><font size="2">Operations at Barbrook during 2004 focused mainly on improving metallurgical circuits and gold recoveries. &nbsp;When mining operations re-started during 2003, the characteristics of the French Bob&#146;s ore fed to the plant were not as defined in earlier test work and as a result of this variability the gold recoveries were below projections. &nbsp;The ore was
considerably more refractory with more arsenopyritic previously. This resulted in lower than expected gold recovery as the organic,
&#147;preg-robbing&#148; carbon</font> <font size="2">content than expected, although
these ores were of higher grade than the pyritic ore types tested&nbsp;</font> <font size="2">continued to contaminate and interfere with the gold recovery process. &nbsp;A number of alternative metallurgical circuits were installed, tested and evaluated, and circuit improvements have now virtually been completed, resulting in improved gold recoveries during the later part of the first quarter
2005.</font></font></P>
<P style="line-height: 100%; font-family: Shruti; font-size: 12pt; text-indent: 0; margin: 0pt" align="left"><font size="2" face="Arial"><BR>The
mineability, geology, and mineralization of the French Bob's ore body, which
is the main operating area of the mine, was re-evaluated and re-modeled during
2002 to determine the optimum mining methods to minimize grade dilution.
&nbsp;Mining has been concentrated in the French Bob's ore zone between 10 and
7 levels. &nbsp;Geological sampling and evaluation on the Taylor's and the
newly discovered Tswala zones, adjacent to, and along strike from, the French
Bob's zone is ongoing. &nbsp;Development and stope tonnages from these areas
will supplement the present production allowing the mill throughput to be
increased to the 8,000 building to 10,000 tonnes per month planned range for
2005. &nbsp;</font></P>
<P style="line-height: 100%; font-family: Shruti; font-size: 12pt; text-indent: 0; margin: 0pt" align="left">&nbsp;</P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=left><font size="2" face="Arial">Bulk ore samples from the Daylight/Victory zones will be taken once these ore zones have been fully exposed and will be tested to confirm the metallurgical amenability of this material in a Biox&#174; circuit. Previous and ongoing Biox&#174; tests on Barbrook concentrates showed gold leach recovery in excess of 90%. Testing Daylight/Victory ores on Biox&#174; will commence in 2005 and if, as anticipated, prove positive, and then the Daylight/Victory area could provide the plant with an
additional<B> </B>potentially higher grade ore source than that of the French Bob&#146;s ore zone. &nbsp;To ensure the continuity of the ore supply from the French Bob&#146;s and adjacent ore zones, development has started on a decline shaft, which will provide access to the French Bob&#146;s zone below the 10 level elevation. &nbsp;The mine plan is focused on converting<B> </B>Resources to Reserves by means of underground development and drilling and has now embarked on an aggressive development program to<B> </B>access the Taylor&#146;s, Victory, Daylight, Crescent and newly discovered Naude&#146;s Strike ore zones.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font size="2" face="Arial">Circuit changes and necessary mechanical repairs at the Barbrook metallurgical plant resulted in sporadic operation during much of 2004. &nbsp;The results achieved are as follows:</font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify>&nbsp;</P>

<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border:0.5pt solid #000000" valign=top width=430.267 colspan=3><P style="margin:0pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">&nbsp;<B><U>Barbrook Mine &#150; 2004 Production Results</U></B></font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=193.667><P style="margin:0pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">Ore mined</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=120><P style="margin:0pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">Tonnes</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=116.6><P style="margin:0pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">44,175</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=193.667><P style="margin:0pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">Development advance</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=120><P style="margin:0pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">Meters</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=116.6><P style="margin:0pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">1,935</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=193.667><P style="margin:0pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">Ore milled</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=120><P style="margin:0pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">Tonnes</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=116.6><P style="margin:0pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">26,592</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=193.667><P style="margin:0pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">Grade milled</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=120><P style="margin:0pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">g/t</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=116.6><P style="margin:0pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">4.5</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=193.667><P style="margin:0pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=center><B><font face="Arial">Gold recovered</font></B></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=120><P style="margin:0pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=center><B><font face="Arial">Ounces</font></B></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=116.6><P style="margin:0pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">1,693</font></B></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>

<P style="margin:0pt; padding-left:-18pt; font-family:Shruti" align=justify><font size="2" face="Arial">Owing to the extreme metallurgical variability of the Barbrook ores, the higher gold grades associated with the refractory arsenopyritic ore zones and lower gold metallurgical recoveries associated with these highly refractory ore types, Barbrook commissioned Goldfields of South Africa to carry out an economic study for the design and installation of a full-plant Biox&#174; process of gold recovery. &nbsp;Goldfields are internationally recognized for their expertise and experience in the bacterial oxidation of refractory gold ores such as those found at Barbrook. &nbsp;Caledonia believes that the Goldfields Biox&#174; technology, successfully used since 1988 at the Barberton Mines complex, located next to Barbrook, will be amenable to all of the different ore types at Barbrook. &nbsp;If implemented, the Biox&#174; plant will be designed in a modular form capable of being readily expanded to take concentrat
es from Caledonia&#146;s other mines and from toll processing.</font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font size="2" face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt">&nbsp;</P>
<p align="left">&nbsp;
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<p style="margin:0pt; padding-left:-18pt; font-family:Shruti" align="justify"><font size="2" face="Arial">Owing to the poorer than expected gold recoveries, a series of modifications were made to the metallurgical circuit to correct gold recovery problems or shortcomings identified when the expected improvements from previous plant changes did not meet expectation. &nbsp;Between late February and May 2004 the operations at the plant were temporarily suspended to carry out modifications, aimed at improved metallurgical gold recovery and increased throughput to 8,000 tonnes per month. The plant modifications included:</font></p>
<ul>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">Installation of a &#147;fines washing and screening&#148; section in the crusher circuit to improve the existing crushing and screening efficiency and to allow for a finer screening size of the crusher product. However, this circuit did not provide the necessary washing efficiency and was by-passed.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">Tests at Barbrook and SGS Lakefield laboratories in Johannesburg have shown that satisfactory flotation gold recovery could be achieved by coarser flotation feed ore sizing. The 8 x 10 Vecor mill (that previously milled to a product size of about 85% minus 75 microns) was reconfigured to enable it to produce a coarser grind to about 65 to 75% minus 75 microns.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">An &#147;organic carbon pre-float&#148; circuit was added to the front of the flotation circuit to remove as much of this &#145;preg-robbing&#146; material from the circuit as possible. This should have reduced the amount of blinding agent present in the leach circuit and consequently reduce the foaming problem in RIL. However, this &#147;carbon pre-float&#148;, although it successfully removed considerable amounts of the organic carbon from the sulphide concentrate, resulted in high gold losses with the carbon and was discontinued.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">Changes were made in the regrind/thickener section to achieve finer regrind sizes and more consistent concentrate feed densities to pre-oxidation and leaching.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">The PreOx and high-intensive agitation sections were not effective in maintaining consistent satisfaction of the concentrate oxygen demand and were replaced by 2 Aachen high-efficiency oxygen dispersion units. Pilot plant tests and plant operation at Barbrook have shown these units provide excellent oxygenation of the fine reground flotation concentrate and lead to more consistent leach gold recoveries. &nbsp;However, the physical operating conditions encountered when using these units have required intense engineering testing of pumps, filters and instrumentation to keep the Aachen units operating in their design ranges.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">Automatic cyanide measurement and addition equipment has been installed in the RIL section to optimize gold recovery and reduce cyanide consumption.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">The size of the elution facility for loaded resin was redesigned by Caledonia and substantially increased. This now allows for improved gold security and greater flexibility of RIL operation.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">A flash flotation cell was added to the Vecor mill circuit treating 100% of the Vecor mill cyclone underflow circuit. This effectively concentrates up to 70% of the gold feeding the flotation section &#150; the flash flotation concentrate being fed directly to the concentrate regrind circuit.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">A second G-cell was installed in flotation for re-cleaning of the cleaner flotation concentrate. This increased the gold grade in the final concentrate product whilst maintaining gold recovery and made operation of the flotation section less complex.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; text-indent:-9pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">Towards the year-end, a combined gravity/cyclone plant was designed, developed and installed by Barbrook to remove most of the organic carbon that consistently caused metallurgical problems in gold recovery. This circuit has now been optimized and removes most of the liberated organic carbon. The organic carbon is discarded with the main flotation tailings. </FONT></li>
</ul>
<P style="margin:0pt; padding-left:36pt; text-indent:-45pt; font-family:Shruti" align=justify><font size="2" face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font size="2" face="Arial">Despite the introduction of the above new processes, the improvements in gold recoveries at the year end and in January 2005 did not improve as significantly as anticipated, and were still recorded well below the level forecast. &nbsp;It had been determined that the gold absorption activity of the resin used in the RIL circuit was much lower than the &#147;fresh&#148; or &#147;new&#148; resin. Despite many tests by the resin suppliers and developers, specific reasons for this reduction in absorption activity were not found. One of the most probable causes was thought to be &#145;oxidation&#146; or &#145;organic fouling&#146; of the resin. The presence of the fine organic carbon, addition of high paraffin (blinding agent), high oxygen gas addition in the RIL and possible high slurry temperatures gave a combined effect of foam formation in the RIL, and this coupled with the low resin gold absorption activity 
caused low leaching gold recoveries.</font></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-45pt; font-family:Shruti" align=justify><font size="2" face="Arial"><BR></font></P>
<p align="left">&nbsp;
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-45pt; font-family:Shruti" align=justify><font size="2" face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-45pt; font-family:Shruti" align=justify>&nbsp;</P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font size="2" face="Arial">The following plant changes were made in late 2004 and early 2005 to remedy the above resin problems and to improve other areas of the process:</font></P>
<ul>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">A new crusher capable of crushing the ore finer was bought and installed. This, together with the fines washing system which was re-commissioned in early March 2005, should produce a finer mill feed which should result in an increased throughput.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">A second flash flotation cell was installed in the main flotation circuit to replace the large 4-cell rougher circuit that was proving difficult to control due to the high organic carbon presence.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">The combined gravity/cyclone plant was further optimized and has increased removal of more than 95% of the liberated organic carbon from the feed to the RIL. Since this optimisation there has been a further improvement in the Aachen and RIL circuits and has eliminated completely the frothing/foaming problem.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">The lower carbon content enabled a much lower dosage of paraffin addition.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">Gold losses in the carbon removal process at about 5% are presently acceptable in view of the improved RIL operation. It is believed that these losses can be removed by optimization of the cyclone circuit.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">Technical management visited the Penjom mine in Malaysia, where a similar RIL operation to Barbrook&#146;s, but on a much larger scale, has operated for several years to gain experience of some of the problems faced by Penjom and their solution.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">The whole of the resin inventory was replaced by fresh resin.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">A test Metso ultra-fine grinding mill was introduced into the circuit.</FONT></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">A number of Barbrook&#146;s circuit changes have now been copied by a mine in the area with similar challenges.</FONT></li>
</ul>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font size="2" face="Arial">Following the above circuit changes, there has been a significant improvement in the operating efficiency in the RIL section with a corresponding increase in gold recovery. The full effect of the above changes will only be determined during March 2005 when all of the process changes are complete and the new plant operation has been optimized. The effect of the changes will mean an immediate increase in tonnage throughput to about 8000 tonnes per month and possibly higher. The metallurgical circuits operating at present are completely different to that originally installed at Barbrook, save for portions of the crushing circuit.</font> </P>
<P style="margin:0pt; padding-left:36pt; text-indent:-45pt; font-family:Shruti; font-size:12pt" align=justify><font size="2" face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; line-height:14pt; font-family:Shruti; font-size:12pt" align=justify><B><font size="3" face="Arial">Eersteling Gold Mine</font></B></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font size="2" face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font size="2" face="Arial">A full geological review of the Eersteling property, including the mine plans and other technical data, was commenced in October 2004. &nbsp;The resources at Eersteling were evaluated and a development program prioritized. Other prospective areas, which should be investigated as potential ore sources, were identified and a surface exploration program has commenced to test some of these areas. &nbsp;This included a high resolution aeromagnetic and radiometric survey, which was completed in January 2005. &nbsp;Potential target zones will be identified and are planned to be drilled during 2005. &nbsp;In the soil geochemical program, 500 soil samples in a 3,500 sample program were collected at Eersteling, with the results currently pending.</font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti; font-size:12pt" align=justify><font size="2" face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; line-height:14pt; font-family:Shruti; font-size:12pt" align=justify><B><font size="3" face="Arial">Outlook</font></B></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font size="2" face="Arial">The forecast production and sale of
Caledonia&#146;s gold for 2005 is at this stage difficult to estimate, and will depend upon the rate and timing of the improved gold production expected at the Barbrook , which will be better established during March 2005, the Rand exchange rate and US Dollar gold price that will prevail during 2005.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font size="2" face="Arial">Looking to the future, should the Biox&#174; process tests prove positive, the Daylight/Victory ore zone could provide the Barbrook plant with a readily accessible, additional source of higher than average grade ore. &nbsp;As highlighted, development is currently in progress on 10 level to provide access to other known ore shoots which extend 110 vertical meters above 10 level at Barbrook. &nbsp;To ensure continuity of the ore supply from the French Bob&#146;s ore zone, development has already started on a decline shaft which will provide access to the French Bob&#146;s zone below the 10 level elevation. &nbsp;Further, the mine has also embarked on an aggressive development program to access the lower portions of the French Bob&#146;s, Victory/Daylight, Crescent and Browns ore zones, and the newly discovered Tswala&#146;s and Naude&#146;s Strike, all part of the Barbrook&#146;s existing underground
infrastructure.</font></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-45pt; font-family:Shruti" align=justify>&nbsp;</P>
<p align="left">&nbsp;
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
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<P style="margin:0pt; padding-left:-9pt; font-family:Shruti; font-size:12pt"><font size="2" face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti"><font size="2" face="Arial">Caledonia intends, subject to a sustainable economic rand gold price and favourable Eersteling/Roodepoort exploration results to re-commence commercial production at Eersteling at some time in the future.</font></P>

<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>

<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=590.4><P style="margin-top:4.65pt; margin-bottom:4.65pt; line-height:16pt; font-family:Shruti; font-size:14pt"><font color="#FFFFFF" size="4" face="Arial">EXPLORATION AND PROJECT DEVELOPMENT</font></P>
</TD></TR>
</TABLE>

<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; line-height:16pt; font-family:Shruti; font-size:14pt" align=justify><B><font face="Arial">GOLD</font> </B></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti; font-size:12pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; line-height:14pt; font-family:Shruti; font-size:12pt" align=justify><B><font face="Arial">Roodepoort</font></B></P>

<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font size="2" face="Arial">The near-surface Roodepoort Gold Property is located 22 kms. north east of the Eersteling Mine area and 8 kms. east of the Zandrivier mine area. Roodepoort is situated on an area of historical gold mining and an unusual (for South Africa) gold-bearing albitite intrusive (a hydrothermally altered granodiorite). &nbsp;Grab samples have returned values of up to 2 g/t gold from pyritic portions of this unit and values greater than 16g/t gold from younger shear zones.</font> </P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font size="2" face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font size="2" face="Arial">A diamond drill program, consisting of three angled (-45&#186;) core holes, was<B> </B>completed during September. Although some results are interesting, the best intersections are 100m deep and were not repeated in the results from the other drill holes. &nbsp;These intersections are believed to correspond to the down dip extension of a number of old workings to the east, whose workings extend to the 30m level. Based on the recent re-evaluation of the drill results. Caledonia now has concluded that the potential for an open-pit operation, based on reported gold mineralization in the albitite body, as previously envisaged requires further exploration. &nbsp;However potential exists for narrower higher grade vein mineralization on this property, which will require further evaluation as a source of ore for the Eersteling metallurgical plant. Further compilation of previous data and assessment of the intersect
ions made will be conducted. Evaluation is planned for 2005 to determine any further work on this property. &nbsp;Drill sections and drill logs from this program can be found for the Roodepoort Project in the &#147;Maps and<B> </B>Reports&#148; section of the Caledonia website.</font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font size="2" face="Arial"><BR></font></P>

<P style="margin:0pt; padding-left:-9pt; line-height:16pt; font-family:Shruti; font-size:14pt" align=justify><B><font face="Arial">DIAMONDS</font> </B></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti; font-size:12pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; line-height:14pt; font-family:Shruti; font-size:12pt" align=justify><B><font face="Arial">Kikerk Lake</font></B></P>
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<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align="left"><font size="2" face="Arial">The Kikerk Lake property consists of 15 mineral leases currently pending approval by the Nunavut Mining Recorder. These leases cover 38,738 acres (15,677 hectares). &nbsp;In 2001 and 2002, Caledonia announced the discoveries of two diamondiferous kimberlites, &#147;Potentilla&#148; and &#147;Stellaria&#148;, on the Kikerk Lake property in Nunavut Canada, by its joint venture partner and operator of the property, Ashton Mining of Canada Inc. (&#147;Ashton&#148;). &nbsp;The two kimberlite pipes are approximately 700 metres apart.&nbsp; All remaining heavy mineral follow-up samples collected from six separate areas on the property during the 2003 summer season were processed during 2004 in Ashton&#146;s laboratory. &nbsp;A total of 361 heavy mineral samples were collected during July and August 2004 by Ashton. The sampling program had two objectives. &nbsp;The first was to better define known indicator mineral 
trains or confirm isolated indicator anomalies. The second was to increase the sample density across the property in those areas of the property where sampling was considered inadequate to confidently assess mineral potential. &nbsp;Results from this sampling program are expected by the end of the second quarter 2005.</font> </P>
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<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=left><font size="2" face="Arial">Caledonia&#146;s 17.5% share of this program is funded by Ashton. &nbsp;Ashton holds a 52.5% interest, having incurred in excess of $750,000 in exploration expenditures on the property. &nbsp;This interest can be increased to 59.5% if Ashton funds Caledonia&#146;s share of the costs through to a completed feasibility study. &nbsp;The remaining 30% interest is held by Stornoway Diamond Corporation.</font></P>

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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">Caledonia has a joint venture agreement with BHP World Exploration Inc. and its affiliate Motapa Diamonds Inc., (&#147;Motapa&#148;) collectively known as &quot;the BHP Entity&quot;, on the Mulonga Plain, Kashiji Plain and Lukulu licences in Western Zambia. Motapa is the project operator on behalf of the joint venture. &nbsp;The BHP Entity is now vested with a 60% participating interest, with Caledonia holding a 40% interest. &nbsp;In terms of the joint venture, the BHP Entity will continue to fund operations through the completion of a feasibility study at which point their interest will increase to 75%. Caledonia will then have various options including that of BHP funding the project through to commercial production.</font></P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">The Mulonga Plain licence area is located in Western Zambia, between the Zambezi River and the Angolan border. &nbsp;Previous work by Motapa has identified four discrete prospective areas within the licence area. The eastern portion of the Mulonga Plain anomaly has been identified as having a higher probability for an initial kimberlite discovery. &nbsp;In November and December 2004 Motapa completed a 5,000 line kilometre airborne gravity and magnetic survey over this eastern area. &nbsp;This survey information has been processed and has identified 71 potential targets for further follow-up. &nbsp;This evaluation will form the basis for drill test work planned for mid-2005 and budgeted at US$520,000.</font></P>

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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">This licence area is located in northwest Zambia, adjacent to the Angolan border. &nbsp;Prior work by Motapa has recovered 22 microdiamonds in association with numerous kimberlitic ilmenites. &nbsp;Field work in 2004 focused on follow-up sampling and ground geophysical work in two discrete areas of anomalous kimberlite indicator mineral and diamond recoveries. &nbsp;In the Chundra Falls anomaly area, located in the northern portion of the Kashiji Plain, 33 heavy mineral samples, ranging in size from 1000 kg bulk macrodiamond samples to 5 kg infill samples were collected. &nbsp;In late 2003, the joint venture added the Lukulu licence area to its land holdings. &nbsp;</font></P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">The Lukulu licence consists of 1,900 km&#178; and is immediately adjacent to the south-east portion of the Kashiji licence area. &nbsp;During 2004 previous work, which has resulted in the recovery of anomalous diamond and kimberlitic ilmenites was followed-up by sampling and ground magnetic surveys. Results from the ground magnetic data and heavy mineral samples will determine the extent of drill test work that may be warranted in 2005.</font></P>

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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">Caledonia has a Prospecting and Option Agreement over the Goedgevonden diamond bearing kimberlite pipe located approximately 20 kilometres north of the Stilfontein gold mine in the Klerksdorp district of the North West Province in South Africa. &nbsp;In early 2002, Caledonia signed Prospecting and Option Agreements over adjacent areas of interest, including the exploration rights to the Syferfontein kimberlite pipe that is located about 1 km north east of the Goedgevonden pipe and other adjacent areas of interest.</font> </P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">Previous prospecting activities carried out in the mid 1970&#146;s on Goedgevonden indicated that the pipe is oval in shape and covers a surface area of approximately 27,000 square metres. &nbsp;This work also confirms that the pipe was drill intersected at a depth of 425 metres, and that further down dip extensions remain undefined. &nbsp;Previous drilling reported an average diamond content of 35 to 45 cpht, with one hole yielding 65 cpht. &nbsp;A fair portion of the diamonds recovered from the drilling were gem quality with a notable tendency toward pink coloured diamonds.</font> </P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">In 2001, Caledonia conducted a stratagem geophysical survey prior to planning a preliminary drilling program in 2002. &nbsp;The preliminary drilling program consisted of 7&#148;, 8&#148; and 12&#148; diameter reverse circulation drill holes, the collection of the drill samples and diamond recovery. &nbsp;Four holes were drilled in the centre of the pipe, three to a depth of 150 metres, and the other to 120 metres. &nbsp;The three remaining holes were drilled to delineate the pipe in more detail. &nbsp;All of the 7 holes drilled entered the kimberlite at a depth of about 6 metres, and the 4 centrally-located holes were stopped whilst still in the kimberlite. &nbsp;A total of about 56 tonnes of drilling sample was collected and processed through a Van Eck and Lurie dense-media separation (&#147;DMS&#148;) plant and wet Sortex machine. &nbsp;From the diamond recoveries it was confirmed that the Goedgevonden pipe was diamondifero
us, and sufficient gem-quality diamonds were recovered to warrant a larger bulk sample. &nbsp;Geological interpretive work was completed during 2003 but there was no exploration activity on this property during 2004 as corporate resources were concentrated on Caledonia&#146;s other projects which are considered as being of higher priority in adding shareholder value.</font></P>

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<P style="margin:0pt; line-height:16pt; font-family:Shruti; font-size:14pt" align="left"><B><font face="Arial">PLATINUM</font></B></P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">In 2002, Eersteling acquired the Rooipoort Platinum Prospect from Anglo Platinum. The property is located approximately 30 km southwest of the Eersteling Gold Mine property and is located in an area that is presently undergoing a surge in platinum group metal exploration along a well mineralised feature known as the &#147;Platreef&#148;. &nbsp;To date Caledonia has drilled a total of 11,005 meters on the Rooipoort Platinum Exploration Project to complete Phases 1 and 2 of this exploration program. A total of 624 metres has been completed of a proposed initial 3,250 metre drilling programme to outline an indicated resource on the property.</font></P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">Initial exploration results indicate that there is PGM and base metal (nickel and copper) mineralization in most of the holes drilled to date over a 6 km strike length. A provisional interpretation of the drill results indicates that the northern and extreme southern portions of the Rooipoort property are most prospective for mineralization at even shallower depths. Future exploration activity will be concentrated in these areas and in the Grasvally property following receipt of the prospecting permit.</font></P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">At the end of 2004, flotation amenability test work was performed at the SGS Lakefield laboratories in Johannesburg, South Africa on mineralized composite samples from 5 lithological units prepared from the diamond drill-hole cores to verify the flotation amenability of the ore. The tests included milling and basic flotation to produce a flotation concentrate. The tests indicated that from each of the 5 mineralized zones, &nbsp;a re-cleaner flotation concentrate of low mass recovery can be produced that contains medium to high recovery of the platinum, palladium, gold, copper and nickel . This initial test work indicates that a simple metallurgical process route could process a flotation concentrate from a high-tonnage lowish-grade feed ore from an open-pit ore source.</font></P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">In 2004 Caledonia purchased and acquired prospecting rights over an additional 342 hectares on the farm Grasvally, immediately adjacent and to the south of the Rooipoort property. On March 11, 2005 Caledonia&#146;s application for the necessary Prospecting Permit from the Department of Minerals and Energy, which was filed on April 23, 2004, was refused on the grounds only of not having a shareholders agreement in place with a black economic empowerment partner. Caledonia believes that this refusal has no basis in law and continues to actively pursue this permit by all available means. Exploration drilling in this area will commence once the necessary exploration permits are issued by the South African Department of Minerals and Energy.</font></P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">Maps and drill logs for the &#147;Rooipoort Platinum Project&#148; shown on Caledonia&#146;s website provide an appreciation of the exploration activity that has been carried out on the Rooipoort property.</font></P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">Caledonia Nama Limited, a wholly owned subsidiary of Caledonia, holds five contiguous exploration licences in northern Zambia which host open-pittable near-surface low grade cobalt /copper mineralization. &nbsp;The 2001/2002 soil-sampling program carried out jointly by Caledonia and BHP Billiton was completed over the majority of the remaining licence area. &nbsp;This program identified a number of high priority anomalous targets within the required geological setting. &nbsp;These targets should be followed up in the search for the suspected presence of larger, deeper, sulphide ore bodies. &nbsp;&nbsp;With the recent substantial increase in the price of copper, Caledonia will search for joint venture partners for the exploration of the potential deeper sulphide-ore zones.&nbsp;</font></P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">In the second quarter of 2004 a mini bulk sample was excavated at Nama and underwent successful screening tests and heavy media/gravity separation tests in South Africa. Following encouraging results, it is now planned to excavate a larger tonnage sample, in conjunction with a cobalt end-user, which will be screened and processed on site to produce a suitable cobalt concentrate for testing through a Zambian smelter. If the test, which is planned for 2005, is successful and satisfactory economic terms are obtained, it is expected that a long-term supply contract for the Nama cobalt/copper concentrate will be negotiated with a smelter or other end users.&nbsp;</font></P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">This large exploration property consisting of three contiguous licence areas was previously joint ventured with Cyprus Amex and is prospective for copper and cobalt. With the recent substantial increase in the price of copper, Caledonia will search for joint venture partners for the exploration of the copper/cobalt potential of Kadola.</font></P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">The Kadola properties also include the Eureka gold/copper/pyrite anomaly. With the significant increase in the price of gold and copper, this project area will be re-evaluated for either joint-venture or for further work by Caledonia.</font> </P>

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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">The outlook for the aforementioned exploration properties is difficult to quantify. &nbsp;Exploration by its nature is speculative with a high degree of risk accompanied by the potential for high returns. &nbsp;Caledonia manages this risk by using well-qualified exploration professionals, senior mining company joint venture partners and by exploring in areas which are considered as having a better than average potential for discovery. &nbsp;The recent &#147;across-the-board&#148; increases in the prices of precious and base metals should improve exploration expenditures of the major mining companies and could improve the likelihood of Caledonia negotiating joint ventures agreements for its remaining wholly-owned exploration properties.</font></P>

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<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:12pt" align="left"><B><font face="Arial">STRATEGIC ALLIANCES</font></B></P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">Exploration is a high-risk, high-cost but potentially high-reward business. &nbsp;Caledonia&#146;s strategy in this area is to position itself to participate in a significant part of the &#147;reward&#148; through joint venture interests in order to minimize early exploration costs. &nbsp;Details of the strategic alliances with joint venture partners have been discussed above.</font></P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">Caledonia currently has two joint venture interests in place, each of which is presently conducting aggressive diamond exploration programmes. &nbsp;Caledonia intends to continue to focus its exploration activities of prospective properties by developing the properties through strategic alliances with senior producers.</font> </P>

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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">Caledonia is committed to maintain the highest environmental standards such that its operations and/or its products do not present an unacceptable risk to its employees, its customers, the public or the environment.</font></P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">Caledonia and its subsidiaries operate under Caledonia&#146;s Environmental Policy that encompasses the following:</font></P>
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    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">Caledonia directs its employees and its subsidiary companies to conduct their exploration and operations activities in a professional, environmentally responsible manner, in compliance with all applicable legislation and policies in the jurisdictions in which they undertake business.</FONT></li>
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    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">Caledonia liaises closely with the applicable government regulatory bodies and the public to optimize communication and an understanding of Caledonia&#146;s activities in relation to environmental protection.</FONT></li>
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    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><FONT face="Arial" size="2">Caledonia is committed to the diligent application of technically proven, economically feasible, environmental protection measures throughout its exploration, development, mining, processing and decommissioning activities.</FONT></li>
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    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><font size="2" face="Arial">Caledonia on a regular ongoing basis monitors its environmental protection management programs to ensure their compliance with the applicable regulatory requirements.</font></li>
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<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial">It is the responsibility of all the employees of Caledonia and its subsidiaries to carry out their employment activities in accordance with this code of practice. Operational line management has the direct responsibility for regular environmental protection management.</font></P>

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<P style="margin:0pt; font-family:Shruti" align="left"><font size="2" face="Arial">During 2004 Caledonia invested $3.8 million on capital assets and mineral properties as compared to $2.3 million in 2003. &nbsp;The majority of the $3.8 million invested in 2004 was spent in South Africa on Barbrook, Eersteling, Rooipoort and Roodepoort.</font> </P>

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<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align="left"><font size="2" face="Arial">During the year, $14.3 million was raised from private placements, exercise of warrants and options as compared to $9.5 million in 2003 and $5.2 million in 2002 (all net of issue costs). &nbsp;The increased financing level reflects improving investor confidence in gold mining and exploration companies in general. &nbsp;</font></P>
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<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align="left"><font size="2" face="Arial">The majority of these funds will be used to finance the improvements in the processing of gold ore at Barbrook and exploration activity on the Company&#146;s most prospective projects.</font></P>
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<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align="left"><font size="2" face="Arial">Caledonia and its subsidiaries are completely debt-free.</font></P>

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<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font size="2" face="Arial">As of December 31, 2004 the Company had working capital of $6.4 million as compared to $3.8 million at December 31, 2003 and $0.8 million at December 31, 2002. &nbsp;&nbsp;Cash and short term deposits increased from $4.2 million at the end of 2003 to $6.5 million at December 31, 2004. &nbsp;</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font size="2" face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=justify><font size="2" face="Arial">During 2004, Caledonia raised $13.3 million in equity financing net of expenses from a private placement by issuing 45,388,175 common shares and $0.8 million from the exercise of 3,449,114 common share purchase warrants and options. &nbsp;Details of financing activities are presented in note 4 (b) of the notes to the consolidated financial statements. &nbsp;During 2005 it is expected that further cash requirements of Caledonia will be met from equity financing activity in conjunction with the proposed listing on the Alternate Investment Market of the London Stock Exchange, and cash flow from gold production at Barbrook.</font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font size="2" face="Arial"><BR></font></P>

<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>

<P style="margin:0pt; font-family:Shruti">&nbsp;</P>
<P style="margin:0pt; font-family:Shruti">&nbsp;</P>
<P style="margin:0pt; font-family:Shruti">&nbsp;</P>
<P style="margin:0pt; font-family:Shruti"><font size="2" face="Arial">The following table summarizes cash flows and cash on hand ($ thousands):</font></P>

<TABLE style="font-size:10pt" cellspacing=0 align=center><TR><TD style="border:0.75pt solid #000000" valign=top width=283.2><font face="Arial">&nbsp;</font></TD><TD style="border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:24.1pt; font-family:Shruti"><B><U><font face="Arial">2004</font></U></B></P>
</TD><TD style="border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:24.1pt; font-family:Shruti"><U><font face="Arial">2003</font></U></P>
</TD><TD style="border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:24.1pt; font-family:Shruti"><U><font face="Arial">2002</font></U></P>
</TD></TR>
<TR><TD style="border-left:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=283.2><P style="margin:0pt; font-family:Shruti"><font face="Arial">Cash</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:16.6pt; font-family:Shruti"><B><font face="Arial">$6,470</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:16.6pt; font-family:Shruti"><font face="Arial">$4,179</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:16.6pt; font-family:Shruti"><font face="Arial">$1,864</font></P>
</TD></TR>
<TR><TD style="border-left:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=283.2><P style="margin:0pt; font-family:Shruti"><font face="Arial">Working capital</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:21.6pt; font-family:Shruti"><B><font face="Arial">6,419</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:21.6pt; font-family:Shruti"><font face="Arial">3,783</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:29.1pt; font-family:Shruti"><font face="Arial">758</font></P>
</TD></TR>
<TR><TD style="border-left:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=283.2><P style="margin:0pt; font-family:Shruti"><font face="Arial">Debt</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:40.75pt; font-family:Shruti"><B><font face="Arial">-</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:40.75pt; font-family:Shruti"><font face="Arial">-</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:40.75pt; font-family:Shruti"><font face="Arial">-</font></P>
</TD></TR>
<TR><TD style="border-left:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=283.2><P style="margin:0pt; font-family:Shruti"><font face="Arial">Cash provided (used) by operating activities</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:14.9pt; font-family:Shruti"><B><font face="Arial">(8,210)</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:14.9pt; font-family:Shruti"><font face="Arial">(4,848)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:14.9pt; font-family:Shruti"><font face="Arial">(2,320)</font></P>
</TD></TR>
<TR><TD style="border-left:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=283.2><P style="margin:0pt; font-family:Shruti"><font face="Arial">Cash provided (used) by investing activities</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:14.9pt; font-family:Shruti"><B><font face="Arial">(3,813)</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:14.9pt; font-family:Shruti"><font face="Arial">(2,279)</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:22.4pt; font-family:Shruti"><font face="Arial">(692)</font></P>
</TD></TR>
<TR><TD style="border-left:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=283.2><P style="margin:0pt; font-family:Shruti"><font face="Arial">Cash provided (used) by financing activities</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:16.6pt; font-family:Shruti"><B><font face="Arial">14,314</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:21.6pt; font-family:Shruti"><font face="Arial">9,442</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=84><P style="margin:0pt; text-indent:21.6pt; font-family:Shruti"><font face="Arial">4,786</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><b><BR></b></font></P>

<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=674.4><P style="margin:0pt; padding-left:45pt; text-indent:-36pt; line-height:16pt; font-family:Shruti; font-size:14pt" align=justify><font face="Arial" color="#FFFFFF" size="3"><b>USES OF LIQUIDITY</b></font></P>
</TD></TR>
</TABLE>

<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>

<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial" size="2">It is the belief of Caledonia that the planned financing activity discussed in the previous paragraph will sustain Caledonia for 2005 and into the year 2006. &nbsp;The anticipated increase of gold production at Caledonia&#146;s Barbrook Mine will also generate cash flow in 2005. &nbsp;However, if funds fall short of requirements, Caledonia will undertake financing options such as private placements with private investors, and if this is still insufficient for its needs, will investigate either project joint ventures or project bank funding. &nbsp;&nbsp;The funds raised by the 2004 financing have been and will be used mainly by Caledonia on its exploration, development and production activities such as:</font></P>
<ul>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><font face="Arial" size="2">at Barbrook by developing access to ore resources below the 10 level and to the east along strike, providing continuity of the mining operations, making capital additions to the Barbrook metallurgical plant, such as a Biox&#174; circuit; &nbsp;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><font face="Arial" size="2">by further drilling/possible bulk sampling and processing of material from Caledonia&#146;s Goedgevonden Diamond Project;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><font face="Arial" size="2">by further drilling at Caledonia&#146;s Rooipoort Platinum Project;</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><font face="Arial" size="2">by further bulk sampling and concentration test work on Caledonia&#146;s Nama Cobalt/Copper Project; and</font></li>
  <li>
    <p style="margin:0pt; padding-left:36pt; font-family:Wingdings" align="justify"><font face="Arial" size="2">by further exploration in respect of the Eersteling Mine to establish the prospects of re-opening it.</font></li>
</ul>
<P style="margin:0pt; font-family:Shruti" align=justify>&nbsp;</P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial" size="2">The funds raised will be sufficient to move forward with the direct development of the above assets if the projects are proven to be economically and technically justified. &nbsp;The Mulonga Plain joint venture with the BHP Entity is subject to joint venture agreements and is fully funded by the joint venture partner through to commercial production. Similarly the Kikerk Lake joint venture with Ashton Mining is fully funded by Ashton. Caledonia continues to actively review the benefits, to Caledonia and its shareholders, of seeking new joint venture partners for most, if not all of its exploration properties.</font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial" size="2"><BR></font></P>

<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=674.4><P style="margin-top:4.65pt; margin-bottom:4.65pt; line-height:7.55pt; font-family:Shruti; font-size:14pt; color:#FFFFFF"><font face="Arial">CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>

<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial" size="2">The Company does not have any significant long-term contractual obligations or commercial commitments other than its responsibilities pursuant to two joint venture agreements discussed elsewhere in this document, except as given below.</font></P>

<P style="margin:0pt; text-indent:21.3pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR><TD style="border:0.5pt solid #000000" valign=top width=218.933><P style="margin:0pt; font-family:Shruti" align=justify><B><U><font face="Arial">Contractual Obligations ($000&#146;s)</font></U></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=58.733><P style="margin:0pt; font-family:Shruti" align=justify><B><U><font face="Arial">Total</font></U></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=122.867><P style="margin:0pt; font-family:Shruti" align=justify><B><U><font face="Arial">Less than 1 year</font></U></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=justify><B><U><font face="Arial">1 to 5 years</font></U></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=105.667><P style="margin:0pt; font-family:Shruti" align=justify><B><U><font face="Arial">After 5 years</font></U></B></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=218.933><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=58.733><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=122.867><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=105.667><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=218.933><P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Purchase Obligations</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=58.733><P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">$320</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=122.867><P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">$52</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">$268</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=105.667><P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">$ 0</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">The above relates to the South African head office. The company has minor obligations in respect of licence fees for its exploration and mining properties some of which are paid by Caledonia&#146;s joint venture partners.</font></P>
<font face="Arial">
<BR>
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
</font>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=674.4><P style="margin-top:4.65pt; margin-bottom:4.65pt; line-height:7.55pt; font-family:Shruti; font-size:14pt; color:#FFFFFF"><font face="Arial">QUARTERLY DATA (unaudited)</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Selected Financial Highlights - 2004</font></B></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">$000&#146;s except per share amount</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">First&nbsp;</font></B></P>
      <P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">Quarter</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">Second&nbsp;</font></B></P>
      <P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial"> Quarter</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">Third&nbsp;</font></B></P>
      <P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial"> Quarter</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">Fourth&nbsp;</font></B></P>
      <P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial"> Quarter</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=center>&nbsp;</P>
<P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">Total Year</font></B></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Balance Sheet</font></B></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Current assets</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$11,621</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$13,022</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$9,753</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$7,481</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$7,481</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Capital assets</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">8,484</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">9,411</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">9,731</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">7,158</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">7,158</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mineral properties</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">7,395</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">7,891</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">8,454</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">8,948</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">8,948</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shareholders&#146; equity</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">25,362</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">28,882</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">26,646</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">22,181</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">22,181</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Operations</font></B></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Revenue</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">140</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">30</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">202</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">469</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">841</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating costs</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1,315</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1,396</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">2,054</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1,686</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">6,451</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Costs and expenses <SUP>(1)</SUP></font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">563</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">69</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">398</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">3,352</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">4,382</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">Net (loss) for the period</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(1,725)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(1,435)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(2,250)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(4,569)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(9,979)</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">Net (loss) per share <SUP>(2)</SUP></font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(0.007)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(0.005)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(0.008)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(0.015)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(0.034)</font></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Selected Financial Highlights &#150; 2003<SUP>(4)</SUP></font></B></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">$000&#146;s except per share amount</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">First&nbsp;</font></B></P>
      <P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial"> Quarter</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">Second&nbsp;</font></B></P>
      <P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial"> Quarter</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">Third&nbsp;</font></B></P>
      <P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial"> Quarter</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">Fourth&nbsp;</font></B></P>
      <P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial"> Quarter</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=bottom width=92.533>
<P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">Total Year</font></B></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Balance Sheet</font></B></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Current assets</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$2,938</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$1,133</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$4,623</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$4,573</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$4,573</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Capital assets</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">7,899</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">7,909</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">8,123</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">7,666</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">7,666</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mineral properties</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">15,915</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">15,960</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">16,070</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">7,212</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">7,212</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shareholders&#146; equity</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">24,454</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">23,057</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">26,656</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">17,651</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">17,651</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Operations</font></B></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Revenue</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">53</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">-</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">259</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">334</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">646</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating costs</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">72</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1,232</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">921</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1,405</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">3,630</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Costs and expenses <SUP>(3)</SUP></font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">189</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">174</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">410</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">10,777</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">11,550</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">Net (loss) for the period</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(208)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(1,406)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(1,072)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(11,810)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(14,496)</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=167.867><P style="margin:0pt; font-family:Shruti"><font face="Arial">Net (loss) per share <SUP>(2)</SUP></font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=85.067><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(0.001)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(0.006)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(0.004)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=94.467><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(0.052)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=92.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(0.062)</font></P>
</TD></TR>
</TABLE>
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<P style="margin:0pt; font-family:Shruti; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-10pt; line-height:10pt; font-family:Shruti; font-size:8pt" align="left"><SUP><font face="Arial">(1)</font></SUP></P>
<P style="margin-top:0pt; margin-bottom:4pt; text-indent:21.3pt; line-height:10pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial">Includes a write down of mineral rights and capital assets at Eersteling in South Africa in the fourth quarter of $1,062</font></P>
<P style="margin-top:0pt; margin-bottom:4pt; line-height:10pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial"><SUP>(2) &nbsp;&nbsp;&nbsp;
</SUP>Represents basic and fully diluted loss per share, in $ per share</font></P>
<P style="margin-top:0pt; margin-bottom:4pt; line-height:10pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial"><SUP>(3) &nbsp;&nbsp;&nbsp;
</SUP>Includes a write down of mineral properties in Zambia and South Africa in the fourth quarter of $9,759</font></P>
<P style="line-height: 10pt; font-family: Shruti; font-size: 8pt; margin-top: 2; margin-bottom: -10pt" align="left"><SUP><font face="Arial">(4)</font></SUP></P>
<P style="margin-top:0pt; margin-bottom:6pt; text-indent:21.3pt; line-height:10pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial">Restated for the adoption of the Asset Retirement Obligation change in accounting policy.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">The fluctuation in operating costs through the year related primarily to variations in activities at Barbrook as various modifications were made to the gold-recovery plant. &nbsp;The revenue increase in the last quarter is from the increase in gold production at Barbrook. The significant reduction in carrying value of capital assets and mineral properties is explained in Notes <SUP>(1) </SUP>and<SUP> (3)</SUP>. Gold production at Barbrook remained below target, due to poor metallurgical recoveries, despite an improvement during the second half of the year. Further laboratory and pilot plant test work is continuing into 2005 to ensure sustainable higher recoveries. A significant increase in gold recovery was obtained in February 2005 and is continuing into March.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify>&nbsp;</P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=674.4><P style="margin-top:4.65pt; margin-bottom:4.65pt; line-height:16pt; font-family:Shruti; font-size:14pt; color:#FFFFFF"><font face="Arial">CRITICAL ACCOUNTING POLICIES</font></P>
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<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Preparing financial statements requires management to make estimates and assumptions that affect the reported results. Estimates are based on historical experience and other assumptions that are believed to be reasonable under the circumstances. The Company&#146;s accounting policies are those that affect the Consolidated Financial Statements and are summarized under the &#147;Summary of Critical Accounting Policies&#148;. &nbsp;The critical accounting policies include accounting for foreign currency translation, capitalization of exploration expenditures and the recognition of impairment of those assets.</font></P>
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<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Costs relating to the acquisition, exploration and development of non-producing resource properties are capitalized until such time as either economically recoverable reserves are established or the properties are sold or abandoned. Based on the results at the conclusion of each phase of an exploration program, properties that are not suitable as prospects are re-evaluated to determine if future exploration is warranted and that carrying values are appropriate The decision to capitalize exploration expenditures and the timing of the recognition that capitalized exploration is unlikely to have future economic benefits can materially affect the reported earnings of the Company.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">A significant portion of the Company&#146;s assets and liabilities are denominated in South African rand. &nbsp;Fluctuations in the value of the rand relative to the Canadian dollar could have a significant impact on results of operations. &nbsp;Exchange gains or losses arising from the translation of South African assets and liabilities are reflected through the income statement in the period in which they occur. &nbsp;</font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=674.4><P style="margin-top:4.65pt; margin-bottom:4.65pt; line-height:7.55pt; font-family:Shruti; font-size:14pt; color:#FFFFFF"><font face="Arial">CHANGES IN CANADIAN ACCOUNTING RECOMMENDATIONS</font></P>
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<P style="margin:0pt; padding-left:45pt; text-indent:-45pt; line-height:14pt; font-family:Courier; font-size:12pt" align=justify><B><font face="Arial">2002</font></B></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">During 2002, the Company chose to present the impact of stock-based compensation as pro-forma information in the notes of the financial statements.</font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:45pt; text-indent:-45pt; line-height:14pt; font-family:Courier; font-size:12pt" align=justify><B><font face="Arial">2003</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Effective January 1, 2003, the Company adopted the new recommendations of the CICA in Handbook Section 3870, &#147;Stock-based compensation and other stock-based payments&#148;. &nbsp;Section 3870 is applied prospectively to all stock-based payments granted on or after January 1, 2003. &nbsp;The Company has chosen to reflect the stock-based compensation as an expense in the statement of operations from that date.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">&nbsp;&nbsp;</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Effective January 1, 2003, the Company adopted a new accounting standard of the CICA in respect of the impairment or disposal of long-lived assets. During the year, the Company reviewed the carrying value of numerous long-lived assets under the new standard resulting in the recording of valuation adjustments as disclosed in Note 3 of the financial statements. &nbsp;</font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:45pt; text-indent:-45pt; line-height:14pt; font-family:Courier; font-size:12pt" align=justify><B><font face="Arial">2004</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">The Company has adopted the accounting guidelines issued by the CICA in respect of hedging relationships for Canadian reporting purposes. The new guidelines will be applied at such time as Caledonia undertakes any hedging contracts. &nbsp;The Company does not anticipate that the new guidelines will have a material effect on the results of operations and financial condition.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Effective January 1, 2004, the Company has adopted CICA 1100, Generally Accepted Accounting Principles. CICA 1100 describes what constitutes Canadian GAAP and its sources. &nbsp;The Company does not anticipate that this will have a material effect on the results of operations and financial condition.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Effective January 1, 2004, the Company has adopted the new CICA rules concerning the accounting for asset retirement obligations. &nbsp;The adoption of this rule will bring Canadian and US GAAP into alignment. For Canadian reporting purposes the new rules have been adopted retrospectively to 1<SUP>st</SUP> January 2002.</font></P>
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<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
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<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
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<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=674.4><P style="margin-top:4.65pt; margin-bottom:4.65pt; line-height:7.55pt; font-family:Shruti; font-size:14pt; color:#FFFFFF"><font face="Arial">SUPPLEMENT TO THE FINANCIAL STATEMENTS</font></P>
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</TABLE>
<P style="margin:0pt; font-family:Shruti; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">As at March 18, 2005 the following equity instruments were outstanding:</font> </P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">301,112,286 common shares and the following options and warrants:</font></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border:0.5pt solid #000000" valign=top width=81.133><P style="margin:0pt; font-family:Shruti" align=center><B><U><font face="Arial">Number</font></U></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=218.933><P style="margin:0pt; font-family:Shruti" align=center><B><U><font face="Arial">Description</font></U></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=105.6><P style="margin:0pt; font-family:Shruti" align=center><B><U><font face="Arial">Exercise Price</font></U></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=193.067><P style="margin:0pt; font-family:Shruti" align=center><B><U><font face="Arial">Validity</font></U></B></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=81.133><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">17,108,700</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=218.933><P style="margin:0pt; font-family:Shruti"><font face="Arial">Common share purchase options</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=105.6><P style="margin:0pt; font-family:Shruti"><font face="Arial">Average $0.22</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=193.067><P style="margin:0pt; font-family:Shruti"><font face="Arial">Various until February 1, 2015</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=81.133><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">13,797,765</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=218.933><P style="margin:0pt; font-family:Shruti"><font face="Arial">Common share purchase warrants</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=105.6><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">$0.55</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=193.067><P style="margin:0pt; font-family:Shruti"><font face="Arial">Until September 29,2005</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=81.133><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">9,905,489</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=218.933><P style="margin:0pt; font-family:Shruti"><font face="Arial">Common share purchase warrants</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=105.6><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">$0.55</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=193.067><P style="margin:0pt; font-family:Shruti"><font face="Arial">Until October 5, 2005</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=81.133><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1,983,091</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=218.933><P style="margin:0pt; font-family:Shruti"><font face="Arial">Common share purchase warrants</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=105.6><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">$0.55</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=193.067><P style="margin:0pt; font-family:Shruti"><font face="Arial">Until October 13, 2005</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=81.133><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1,546,564</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=218.933><P style="margin:0pt; font-family:Shruti"><font face="Arial">Common share purchase warrants</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=105.6><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">$0.55</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=193.067><P style="margin:0pt; font-family:Shruti"><font face="Arial">Until October 26,2005</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=674.4><P style="margin-top:4.65pt; margin-bottom:4.65pt; line-height:16pt; font-family:Shruti; font-size:14pt; color:#FFFFFF"><font face="Arial">FORWARD LOOKING STATEMENTS</font></P>
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</TABLE>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=left><font face="Arial">This annual report contains certain forward-looking statements relating but not limited to the Company&#146;s expectations, intentions, plans and beliefs. Forward-looking information can often be identified by forward-looking words such as &#147;anticipate&#148;, &#147;believe&#148;, &#147;expect&#148;, &#147;goal&#148;, &#147;plan&#148;, &#147;intend&#148;, &#147;estimate&#148;, &#147;could&#148;, &#147;should&#148;, &#147;may&#148; and &#147;will&#148; or similar words suggesting future outcomes, or other expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. Forward-looking information may include reserve and resource estimates, estimates of future production, unit costs, costs of capital projects and timing of commencement of operations, and is based on current expectations that involve a number of business risks and uncertainties. Factors that could cause actual results to
 differ materially from any forward-looking statement include, but are not limited to, failure to establish estimated resources and reserves, the grade and recovery of ore which is mined varying from estimates, capital and operating costs varying significantly from estimates, delays in obtaining or failures to obtain required governmental, environmental or other project approvals, inflation, changes in exchange rates, fluctuations in commodity prices, delays in the development of projects and other factors. Forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from expected results.</font></P>
<P style="margin:0pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=left><font face="Arial">Potential shareholders and prospective investors should be aware that these statements are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those suggested by the forward-looking statements. Shareholders are cautioned not to place undue reliance on forward-looking information. By its nature, forward-looking information involves numerous assumptions, inherent risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and various future events will not occur. Caledonia undertakes no obligation to update publicly or otherwise revise any forward-looking information whether as a result of new information, future events or other such factors which affect this information, except as required by law.</font></P>
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<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=638.4><P style="margin-top:4.65pt; margin-bottom:4.65pt; line-height:16pt; font-family:Shruti; font-size:14pt; color:#FFFFFF"><font face="Arial">MANAGEMENT&#146;S RESPONSIBILITY FOR FINANCIAL INFORMATION</font></P>
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<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:12pt" align="left"><B><font face="Arial">To the Shareholders of Caledonia Mining Corporation:</font></B></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">Management has prepared the information and representations in this annual report. The consolidated financial statements have been prepared in conformity with generally accepted accounting principles applied in Canada and, where appropriate, reflect management&#146;s best estimates and judgement. The financial information presented throughout this report is consistent with the data presented in the consolidated financial statements.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Caledonia maintains adequate systems of internal accounting and administrative controls, consistent with reasonable cost. Such systems are designed to provide reasonable assurance that relevant and reliable financial information is produced. Our independent auditors have the responsibility of auditing the consolidated financial statements and expressing an opinion on them.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">The Board of Directors, through its Audit Committee, is responsible for ensuring that management fulfils its responsibilities for financial reporting and internal control. The Audit Committee is composed of three unrelated directors. This Committee meets periodically with management and the external auditors to review accounting, auditing, internal control and financial reporting matters.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">The consolidated financial statements have been audited on behalf of the shareholders by the Company&#146;s independent auditors, BDO Dunwoody LLP, in accordance with generally accepted auditing standards in Canada and the standards of the Public Accounting Oversight Board (United States). &nbsp;The auditors&#146; report outlines the scope of their examination and their opinion on the consolidated financial statements</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:108pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align=justify><font face="Arial">(signed)</font></P>
<P style="margin:0pt; text-indent:180pt; font-family:Shruti" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(signed)</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align=justify><font face="Arial">S. E. Hayden</font></P>
<P style="margin:0pt; text-indent:212.65pt; font-family:Shruti" align=justify><font face="Arial">M. D. Tombs</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align=justify><font face="Arial">President and Chief Executive Officer</font></P>
<P style="margin:0pt; text-indent:216pt; font-family:Shruti" align=justify><font face="Arial">Vice-President, Finance and Chief Financial Officer<BR>
</font>
</P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="line-height: 16pt; font-family: Shruti; font-size: 14pt; margin-top: 7pt; margin-bottom: 0pt; padding-top: 3pt" align=right><B><font face="Arial">Auditors&#146; Report</font></B></P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Courier; font-size:12pt; border-bottom:1.5pt solid #000000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:0.9pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><B><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></B></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti" align="left"><B><font face="Arial">To the Shareholders of</font></B></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti" align="left"><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti" align=justify><font face="Arial">We have audited the consolidated balance sheets of Caledonia Mining Corporation as at December 31, 2004 and 2003 and the consolidated statements of deficit, operations and cash flow for each of the years in the three year period ended December 31, 2004. &nbsp;These financial statements are the responsibility of the Company&#146;s management. &nbsp;Our responsibility is to express an opinion on these consolidated financial statements based on our audits.</font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti" align=justify><font face="Arial">We conducted our audits in accordance with Canadian generally accepted auditing standards and the standards of the Public Accounting Oversight Board (United States). &nbsp;&nbsp;Those standards require that we plan and perform an audit to obtain reasonable assurance whether the financial statements are free of material misstatement. &nbsp;An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. &nbsp;An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.</font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti" align=left><font face="Arial">In our opinion, these consolidated financial statements present fairly, in all material respects, the financial position of the Company as at December 31, 2004 and 2003 and the results of its operations and its cash flow for each of the years in the three year period ended December 31, 2004 in accordance with Canadian generally accepted accounting principles.</font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><img src="argosy002.gif" alt="[argosy002.gif]" align=middle height=55 width=199></font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti" align="left"><font face="Arial">Chartered Accountants</font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti" align="left"><font face="Arial">Toronto, Ontario</font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti" align="left"><font face="Arial">February 11, 2005</font></P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Courier; font-size:12pt; border-bottom:1.5pt solid #000000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:1.35pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:14pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:16pt; font-family:Shruti; font-size:14pt" align=center><B><font face="Arial">Comments by Auditors for U.S. Readers on Canada - U.S. Reporting Conflict</font></B></P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Courier; font-size:12pt; border-bottom:1.5pt solid #000000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:0.9pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti" align=left><font face="Arial">In the United States, reporting standards for auditors require the addition of an explanatory paragraph (following the opinion paragraph) when the financial statements are affected by conditions and events that cast substantial doubt on the Company&#146;s ability to continue as a going concern, such as those described in the summary of significant accounting policies. &nbsp;The United States reporting standards also require the addition of an explanatory paragraph when
changes in an accounting policy, such as those involving asset retirement obligations, stock based compensation and impairment of long lived assets described in the summary of significant accounting policies, have a material effect on the consolidated financial statements. Our report to the shareholders dated February 11, 2005 is expressed in accordance with Canadian reporting standards which do not require a reference to such events and conditions in the auditors&#146; report when these are adequately disclosed in the financial statements.</font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><img src="argosy004.gif" alt="[argosy004.gif]" align=middle height=55 width=199></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">Chartered Accountants</font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">Toronto, Ontario</font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">February 11, 2005</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-top:3pt; font-family:Shruti; font-size:12pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt" align=right><B><font face="Arial">Consolidated Balance Sheets</font></B></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt" align=right><B><font face="Arial">(in thousands of Canadian dollars)</font></B></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="line-height: 14pt; font-family: Shruti; border-bottom-color: #000000; border-bottom-width: 1pt; margin-top: 0pt; margin-bottom: -11pt">&nbsp;</P>
<P style="text-indent: 354.4pt; line-height: 14pt; font-family: Shruti; border-bottom-color: #000000; border-bottom-width: 1pt; margin-top: 0pt; margin-bottom: -11pt">&nbsp;</P>
<P style="text-indent: 396.9pt; line-height: 14pt; font-family: Shruti; border-bottom-color: #000000; border-bottom-width: 1pt; margin-top: 0pt; margin-bottom: -11pt"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
<P style="text-indent: 425.25pt; font-family: Shruti; border-bottom-color: #000000; border-bottom-width: 1pt; margin: 0pt; padding-bottom: 3pt">&nbsp;</P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=432 style="border-bottom: 1 solid #000000"><B><font face="Arial">December 31</font></B>
</TD><TD valign=top width=96 align="right" style="border-bottom: 1 solid #000000"><B><font face="Arial">2004</font></B></TD><TD valign=top width=96 align="right" style="border-bottom: 1 solid #000000"><font face="Arial">2003</font></TD></TR>
  <TR><TD valign=top width=432><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Assets</font></B></P>
</TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti">&nbsp;</P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=432><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Current</font></B></P>
</TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=432><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Cash and short term deposits</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$6,470</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$4,179</font></P>
</TD></TR>
<TR><TD valign=top width=432><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">316</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">178</font></P>
</TD></TR>
<TR><TD valign=top width=432><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Inventories</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">508</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">86</font></P>
</TD></TR>
<TR><TD valign=top width=432><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">187</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">130</font></P>
</TD></TR>
<TR><TD valign=top width=432><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">7,481</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">4,573</font></P>
</TD></TR>
<TR><TD valign=top width=432><P style="margin:0pt; font-family:Shruti"><font face="Arial"><B>Investment at cost</B> (Note 1)</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">79</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">79</font></P>
</TD></TR>
<TR><TD valign=top width=432><P style="margin:0pt; font-family:Shruti"><font face="Arial"><B>Capital assets</B> (Note 2)</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">7,158</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">7,666</font></P>
</TD></TR>
<TR><TD valign=top width=432><P style="margin:0pt; font-family:Shruti"><font face="Arial"><B>Mineral properties</B> (Note 3)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">8,948</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">7,212</font></P>
</TD></TR>
<TR><TD valign=top width=432><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$23,666</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$19,530</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=434.733><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Liabilities and Shareholders&#146; Equity</font></B></P>
</TD><TD valign=top width=93.267><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=434.733><P style="margin:0pt; font-family:Shruti"><font face="Arial">Current</font></P>
</TD><TD valign=top width=93.267><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=434.733><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable</font></P>
</TD><TD valign=top width=93.267><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$1,062</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$790</font></P>
</TD></TR>
<TR><TD valign=top width=434.733><font face="Arial">&nbsp;</font></TD><TD valign=top width=93.267><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=434.733><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Provision for site restoration</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=93.267><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">423</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">353</font></P>
</TD></TR>
<TR><TD valign=top width=434.733><font face="Arial">&nbsp;</font></TD><TD valign=top width=93.267><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">1,485</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1,143</font></P>
</TD></TR>
<TR><TD valign=top width=434.733><P style="margin:0pt; font-family:Shruti"><font face="Arial"><B>Non-controlling interest </B>(Note 13)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=93.267><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">0</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">736</font></P>
</TD></TR>
<TR><TD valign=top width=434.733><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=93.267><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">1,485</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1,879</font></P>
</TD></TR>
<TR><TD valign=top width=434.733><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=93.267><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><font face="Arial">&nbsp;</font></TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=425.267><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Shareholders&#146; Equity</font></B></P>
</TD><TD valign=top width=103.933><font face="Arial">&nbsp;</font></TD><TD valign=top width=94.8><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=425.267><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Share capital (Note 4(b))</font></P>
</TD><TD valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">173,304</font></B></P>
</TD><TD valign=top width=94.8><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">159,151</font></P>
</TD></TR>
<TR><TD valign=top width=425.267><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Contributed surplus (Note 4 (c))</font></P>
</TD><TD valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">480</font></B></P>
</TD><TD valign=top width=94.8><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">285</font></P>
</TD></TR>
<TR><TD valign=top width=425.267><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Warrants (Note 4 (b))</font></P>
</TD><TD valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">321</font></B></P>
</TD><TD valign=top width=94.8><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">160</font></P>
</TD></TR>
<TR><TD valign=top width=425.267><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Deficit</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">(151,924)</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=94.8><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(141,945)</font></P>
</TD></TR>
<TR><TD valign=top width=425.267><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">22,181</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=94.8><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">17,651</font></P>
</TD></TR>
<TR><TD valign=top width=425.267><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=103.933><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$23,666</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=94.8><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$19,530</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">On behalf of the Board:</font></P>
<P style="text-indent: 0; font-family: Courier; font-size: 12pt; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align="left"><font face="Arial"><BR></font></P>
<P style="line-height: 14pt; font-family: Shruti; text-indent: 0; margin-top: 0pt; margin-bottom: 0" align="left"><font face="Arial">(signed)&nbsp;&nbsp;&nbsp;</font>&nbsp;&nbsp;&nbsp;
<font face="Arial">J.Johnstone</font></P>
<P style="line-height: 14pt; font-family: Shruti; text-indent: 0; margin-top: 0pt; margin-bottom: 0" align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<font face="Arial">Director</font></P>
<P style="text-indent: 0; font-family: Shruti; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align="left"><font face="Arial"><BR></font></P>
<P style="text-indent: 0; font-family: Shruti; margin-left: 0pt; margin-right: 0pt; margin-top: 0pt; margin-bottom: 0" align="left"><font face="Arial"><BR></font></P>
<P style="line-height: 14pt; font-family: Shruti; text-indent: 0; margin-top: 0pt; margin-bottom: 0" align="left"><font face="Arial">(signed)&nbsp;&nbsp;&nbsp;</font>&nbsp;&nbsp;&nbsp;&nbsp;
<font face="Arial">F.C.Harvey</font></P>
<P style="line-height: 14pt; font-family: Shruti; text-indent: 0; margin-top: 0pt; margin-bottom: 0" align="left"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Director</font></P>
<P style="margin:0pt; text-indent:288pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:8pt"><font face="Arial">The accompanying summary of significant accounting policies and notes are an integral part of these financial statements.</font></P>
<font face="Arial">
<BR>
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
</font>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Consolidated Statements of Deficit</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">(in thousands of Canadian dollars)</font></B></P>
<P style="font-family: Shruti; text-indent: 0; margin: 0pt" align=right><font face="Arial"><BR></font></P>
<P style="text-indent: 0; line-height: 14pt; font-family: Shruti; margin-top: 0pt; margin-bottom: -11pt; padding-left: 36pt">&nbsp;</P>
<P style="margin:0pt; line-height:0.65pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size: 10pt" cellspacing=0 width="638"><TR><TD valign=top width=310 style="border-bottom: 1 solid #000000"><B><font face="Arial">For the years ended December 31</font></B>
</TD><TD valign=top width=104 align="right" style="border-bottom: 1 solid #000000"><font face="Arial"><b>2004</b></font>
</TD><TD valign=top width=104 align="right" style="border-bottom: 1 solid #000000"><font face="Arial">2003</font>
</TD><TD valign=top width=104 align="right" style="border-bottom: 1 solid #000000"><font face="Arial">2002</font>
</TD></TR>
  <TR><TD valign=top width=310><P style="margin:0pt; font-family:Shruti"><font face="Arial"><B>Deficit</B>, beginning of year</font></P>
</TD><TD valign=top width=104><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">($141,945)</font></B></P>
</TD><TD valign=top width=104><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">($127,449)</font></P>
</TD><TD valign=top width=104><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">($123,003)</font></P>
</TD></TR>
<TR><TD valign=top width=310><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Net (loss) for the year</font></B></P>
</TD><TD style="border-bottom: 1.5pt solid #000000" valign=top width=106><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">(9,979)</font></B></P>
</TD><TD style="border-bottom: 1.5pt solid #000000" valign=top width=106><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(14,496)</font></P>
</TD><TD style="border-bottom: 1.5pt solid #000000" valign=top width=106><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(4,446)</font></P>
</TD></TR>
<TR><TD valign=top width=310><P style="margin:0pt; font-family:Shruti"><font face="Arial"><B>Deficit</B>, end of year</font></P>
</TD><TD valign=top width=104><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial"><B>($151,924</B>)</font></P>
</TD><TD valign=top width=104><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">($141,945)</font></P>
</TD><TD valign=top width=104><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">($127,449)</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Consolidated Statements of Operations</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">(in thousands of Canadian dollars except share and per share amounts)</font></B></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:0.65pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=334.8 style="border-bottom: 1 solid #000000"><B><font face="Arial">For the years ended December 31</font></B>
</TD><TD valign=top width=97.2 align="right" style="border-bottom: 1 solid #000000"><font face="Arial"><b>2004</b></font></TD><TD valign=top width=96 align="right" style="border-bottom: 1 solid #000000"><font face="Arial">2003</font></TD><TD valign=top width=96 align="right" style="border-bottom: 1 solid #000000"><font face="Arial">2002</font></TD></TR>
  <TR><TD valign=top width=334.8><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Revenue and operating costs</font></B></P>
</TD><TD valign=top width=97.2><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=334.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Revenue from sales</font></P>
</TD><TD valign=top width=97.2><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$841</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$646</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$27</font></P>
</TD></TR>
<TR><TD valign=top width=334.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Operating costs</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=97.2><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">6,451</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">3,630</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">145</font></P>
</TD></TR>
<TR><TD valign=top width=334.8><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Gross profit (loss)</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=97.2><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">(5,610)</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(2,984)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(118)</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=334.8><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Costs and expenses</font></B></P>
</TD><TD valign=top width=97.2><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=334.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;General and administrative</font></P>
</TD><TD valign=top width=97.2><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">1,984</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1,276</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1,540</font></P>
</TD></TR>
<TR><TD valign=top width=334.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Interest</font> </P>
</TD><TD valign=top width=97.2><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">175</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">127</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">29</font></P>
</TD></TR>
<TR><TD valign=top width=334.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Amortization</font></P>
</TD><TD valign=top width=97.2><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">800</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">438</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">16</font></P>
</TD></TR>
<TR><TD valign=top width=334.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Other expense (income) (Note 7)</font></P>
</TD><TD valign=top width=97.2><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">361</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(50)</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">166</font></P>
</TD></TR>
<TR><TD valign=top width=334.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Write down of mineral properties</font> </P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=97.2><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">1,062</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">9,759</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">2,590</font></P>
</TD></TR>
<TR><TD valign=top width=334.8><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=97.2><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">4,382</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">11,550</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">4,341</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=334.8><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">(Loss) before non-controlling interest</font></B></P>
</TD><TD valign=top width=97.2><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">(9,992)</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(14,534)</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(4,459)</font></P>
</TD></TR>
<TR><TD valign=top width=334.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Non-controlling interest</font></P>
</TD><TD valign=top width=97.2 align="right"><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">(13)</font></B></P>
</TD><TD valign=top width=96 align="right"><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(38)</font></P>
</TD><TD valign=top width=96 align="right"><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(13)</font></P>
</TD></TR>
<TR><TD valign=top width=334.8><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Net (loss) for the year</font></B></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=top width=97.2 align="right"><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">($9,979)</font></B></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=top width=96 align="right"><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;($14,496)</font></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=top width=96 align="right"><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">($4,446)</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=334.8><P style="margin-top:5pt; margin-bottom:0pt; font-family:Shruti"><B><font face="Arial">Net (loss) per share (Note 6)</font></B></P>
</TD><TD valign=top width=97.2 align="right"><font face="Arial">&nbsp;</font></TD><TD valign=top width=96 align="right"><font face="Arial">&nbsp;</font></TD><TD valign=top width=96 align="right"><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=334.8><P style="margin-top:0pt; margin-bottom:5pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;Basic and fully diluted</font></P>
</TD><TD valign=top width=97.2 align="right"><P style="margin-top:0pt; margin-bottom:5pt; font-family:Shruti" align=right><B><font face="Arial">($0.034)</font></B></P>
</TD><TD valign=top width=96 align="right"><P style="margin-top:0pt; margin-bottom:5pt; font-family:Shruti" align=right><font face="Arial">($0.062)</font></P>
</TD><TD valign=top width=96 align="right"><P style="margin-top:0pt; margin-bottom:5pt; font-family:Shruti" align=right><font face="Arial">($0.023)</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:8pt"><font face="Arial">The accompanying summary of significant accounting policies and notes are an integral part of these financial statements.</font></P>
<font face="Arial">
<BR>
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
</font>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Consolidated Statements of Cash Flows</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">(in thousands of Canadian dollars)</font></B></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="text-indent: 389.25pt; font-family: Shruti; border-bottom-color: #000000; border-bottom-width: 1pt; margin: 0pt; padding-left: 36pt; padding-bottom: 3pt">&nbsp;</P>
<P style="margin:0pt; line-height:0.65pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=349.667 style="border-bottom: 1 solid #000000"><B><font face="Arial">For the years ended December 31</font></B>
</TD><TD valign=top width=83.333 align="right" style="border-bottom: 1 solid #000000"><font face="Arial"><b>2004</b></font></TD><TD valign=top width=94.6 align="right" style="border-bottom: 1 solid #000000"><font face="Arial">2003</font></TD><TD valign=top width=96.4 align="right" style="border-bottom: 1 solid #000000"><font face="Arial">2002</font></TD></TR>
  <TR><TD valign=top width=349.667><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Cash provided by (used in)</font></B></P>
</TD><TD valign=top width=83.333><font face="Arial">&nbsp;</font></TD><TD valign=top width=94.6><font face="Arial">&nbsp;</font></TD><TD valign=top width=96.4><font face="Arial">&nbsp;</font></TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=349.667><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti"><B><font face="Arial">Operating activities</font></B></P>
</TD><TD valign=top width=83.333><font face="Arial">&nbsp;</font></TD><TD valign=top width=94.6><font face="Arial">&nbsp;</font></TD><TD valign=top width=96.4><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=349.667><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;Net (loss) for the year</font></P>
</TD><TD valign=top width=83.333><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial"><B>&nbsp;($9,979</B>)</font></P>
</TD><TD valign=top width=94.6><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">&nbsp;&nbsp;&nbsp;($14,496)</font></P>
</TD><TD valign=top width=96.4><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">($4,446)</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; text-indent:7.1pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=349.667><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;Adjustments to reconcile net cash from operations &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Note 8)</font> </P>
</TD><TD valign=top width=83.333><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">2,114</font></B></P>
</TD><TD valign=top width=94.6><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">10,289</font></P>
</TD><TD valign=top width=96.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">2,599</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; text-indent:7.1pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=349.667><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;Changes in non-cash working capital balances</font></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;( Note 8)</font></P>
</TD><TD valign=top width=83.333><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">(345)</font></B></P>
</TD><TD valign=top width=94.6><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(641)</font></P>
</TD><TD valign=top width=96.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(473)</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; text-indent:7.1pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=349.667><font face="Arial">&nbsp;</font></TD><TD style="border-top:1.5pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=83.333><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><B><font face="Arial">(8,210)</font></B></P>
</TD><TD style="border-top:1.5pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=94.6><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">(4,848)</font></P>
</TD><TD style="border-top:1.5pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=96.4><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">(2,320)</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; text-indent:7.1pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=349.667><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti"><B><font face="Arial">Investing activities</font></B></P>
</TD><TD valign=top width=83.333><font face="Arial">&nbsp;</font></TD><TD valign=top width=94.6><font face="Arial">&nbsp;</font></TD><TD valign=top width=96.4><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=349.667><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;Purchase of investment</font></P>
</TD><TD valign=top width=83.333><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=94.6><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=96.4><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">(79)</font></P>
</TD></TR>
<TR><TD valign=top width=349.667><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;Expenditures on capital assets and mineral properties</font></P>
</TD><TD valign=top width=83.333><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><B><font face="Arial">(3,813)</font></B></P>
</TD><TD valign=top width=94.6><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">(2,279)</font></P>
</TD><TD valign=top width=96.4><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">(613)</font></P>
</TD></TR>
<TR><TD valign=top width=349.667><font face="Arial">&nbsp;</font></TD><TD style="border-top:1.5pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=83.333><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><B><font face="Arial">(3,813)</font></B></P>
</TD><TD style="border-top:1.5pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=94.6><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">(2,279)</font></P>
</TD><TD style="border-top:1.5pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=96.4><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">(692)</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; text-indent:7.1pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=349.667><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti"><B><font face="Arial">Financing activities</font></B></P>
</TD><TD valign=top width=83.333><font face="Arial">&nbsp;</font></TD><TD valign=top width=94.6><font face="Arial">&nbsp;</font></TD><TD valign=top width=96.4><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=349.667><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;Loan payable</font></P>
</TD><TD valign=top width=83.333><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=94.6><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">(69)</font></P>
</TD><TD valign=top width=96.4><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">(388)</font></P>
</TD></TR>
<TR><TD valign=top width=349.667><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;Issue of share capital net of issue costs</font> </P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=83.333><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><B><font face="Arial">14,314</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=94.6><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">9,511</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96.4><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">5,174</font></P>
</TD></TR>
<TR><TD valign=top width=349.667><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=83.333><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><B><font face="Arial">14,314</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=94.6><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">9,442</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96.4><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">4,786</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; text-indent:7.1pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=349.667><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Increase in cash for the year</font></B></P>
</TD><TD valign=top width=83.333><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><B><font face="Arial">2,291</font></B></P>
</TD><TD valign=top width=94.6><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">2,315</font></P>
</TD><TD valign=top width=96.4><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">1,774</font></P>
</TD></TR>
<TR><TD valign=top width=349.667><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Cash and cash equivalents, beginning of year</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=83.333><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><B><font face="Arial">4,179</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=94.6><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">1,864</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96.4><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">90</font></P>
</TD></TR>
<TR><TD valign=top width=349.667><P style="margin:0pt; font-family:Shruti"><B><font face="Arial">Cash and cash equivalents, end of year</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=83.333><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><B><font face="Arial">$6,470</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=94.6><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">$4,179</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96.4><P style="margin:0pt; text-indent:7.1pt; font-family:Shruti" align=right><font face="Arial">$1,864</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; padding-left:21.6pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:21.6pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:8pt"><font face="Arial">The accompanying summary of significant accounting policies and notes are an integral part of these financial statements.</font></P>
<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:14pt" align=right><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
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<BR>
</font>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Summary of Significant Accounting Policies</font></B></P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; line-height:0.9pt; font-family:Courier; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><B><font face="Arial">Nature of Business</font></B></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">The Company is engaged in the acquisition, exploration and development of mineral properties for the exploitation of base and precious metals. &nbsp;The ability of the Company to recover the amounts shown for its capital assets and mineral properties is dependent upon the existence of economically recoverable reserves; the ability of the Company to obtain the necessary financing to complete exploration and development; and future profitable production or proceeds from the disposition of such capital assets and mineral properties.</font></P>
<P style="margin:0pt; font-family:Courier"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><B><font face="Arial">Basis of Presentation</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">These financial statements have been prepared on the basis of a going concern, which contemplates that the Company will be able to realize assets and discharge liabilities in the normal course of business. &nbsp;The Company&#146;s ability to continue as a going concern is dependent upon attaining profitable operations and obtaining sufficient financing to meet its liabilities, its obligations with respect to operating expenditures and expenditures required on its mineral properties.</font></P>
<P style="margin:0pt; font-family:Courier" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><B><font face="Arial">Measurement Uncertainties</font></B></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenues and expenses during the reporting period. &nbsp;The more significant areas requiring estimates relate to mineral resources, future cash flows associated with capital assets and mineral properties. &nbsp;Management&#146;s calculation of reserves and resources and cash flows are based upon engineering and geological estimates and financial estimates including gold prices and operating costs. &nbsp;The amount ultimately recovered could be materially different than the estimated values.</font></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><B><font face="Arial">Principles of Consolidation</font></B></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">The consolidated financial statements include the accounts of the Company together with all its subsidiaries. &nbsp;All significant inter-company balances and transactions have been eliminated on consolidation.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">The Company&#146;s consolidated subsidiaries (all 100% owned) are Barbrook Mines Limited &nbsp;(&quot;Barbrook&quot;), Eersteling Gold Mining Company Limited (100% owned since June 2004) (&quot;Eersteling&quot;) Greenstone Management Services (Proprietary) Limited, Fintona Investments (Proprietary) Limited, Maid O&#146; Mist (Proprietary) Limited, Caledonia Mining (Zambia) Limited, Caledonia Kadola Limited, Caledonia Nama Limited and Caledonia Western Limited.</font></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><B><font face="Arial">Cash and Cash Equivalents</font></B></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">Cash and cash equivalents represent cash on hand in operating bank accounts and money market funds.</font></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><B><font face="Arial">Inventories</font></B></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">Inventories are stated at the lower of cost, which is determined on the first-in, first-out basis, and net realizable value.</font></P>
<P style="margin:0pt; padding-left:21.3pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><B><font face="Arial">Revenue Recognition</font></B></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">Revenue from the sale of precious metals is recognized when the significant risks and rewards of ownership are transferred to the buyer and collection is reasonably assured.</font></P>
<font face="Arial">
<BR>
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
</font>
<P style="margin:0pt; padding-left:21.3pt; font-family:Courier; font-size:12pt">&nbsp;</P>
<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Summary of Significant Accounting Policies (continued)</font></B></P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><B><font face="Arial">Capital Assets</font></B></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><B><I><font face="Arial">Producing Assets</font></I></B></P>
<P style="margin:0pt; font-family:Shruti" align=left><font face="Arial">Producing assets are recorded at cost less grants, accumulated amortization and write-downs. &nbsp;Producing assets are amortized using the straight line method basis on the estimated useful lives of the assets. &nbsp;The estimated life of the producing assets ranges up to 10 years. Repairs and maintenance expenditures are charged to operations; major improvements and replacements which extend the useful life of an asset are capitalized and amortized over the remaining useful life of that asset. &nbsp;Barbrook continues to undertake activities to re-establish commercial operations and has been presented as a producing asset in these financial statements for 2004 and 2003. As of December 31, 2002, the Company did not have any producing capital assets.</font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><B><I><font face="Arial">Non-Producing Assets</font></I></B></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">Non-producing assets are recorded at cost less write downs. &nbsp;During non-producing periods, no amortization is recorded.</font> </P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">At the time of commercial production, the assets are reclassified as producing and amortized in the manner described above.</font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><B><font face="Arial">Mineral Properties</font></B></P>
<P style="margin:0pt; font-family:Courier; font-size:8pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><B><I><font face="Arial">Producing Properties</font></I></B></P>
<P style="margin:0pt; font-family:Shruti" align=left><font face="Arial">When and if properties are placed in production, the applicable capitalized costs are amortized using the unit-of-production method on the ratio of tonnes of ore mined or processed to the estimated proven and probable mineral reserves as defined by the Canadian Institute of Mining, Metallurgy and Petroleum. &nbsp;Barbrook continues to undertake activities to re-commence commercial operations and has been presented as a producing asset in these financial statements for both 2004 and 2003. &nbsp;For the 2002 fiscal year the Company did not have any producing mineral properties.</font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><B><I><font face="Arial">Non-Producing Properties</font></I></B></P>
<P style="margin:0pt; font-family:Shruti" align=left><font face="Arial">Costs relating to the acquisition, exploration and development of non-producing resource properties which are held by the Company or through its participation in joint ventures are capitalized until such time as either economically recoverable reserves are established, or the properties are sold or abandoned. &nbsp;</font></P>
<P style="margin:0pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=left><font face="Arial">A decision to abandon, reduce or expand activity on a specific project is based upon many factors including general and specific assessments of mineral reserves, anticipated future mineral prices, anticipated costs of developing and operating a producing mine, the expiration date of mineral property leases, and the general likelihood that the Company will continue exploration on the project. &nbsp;However, based on the results at the conclusion of each phase of an exploration program, properties that are not suitable as prospects are re-evaluated to determine if future exploration is warranted and that carrying values are appropriate.</font></P>
<P style="margin:0pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=left><font face="Arial">The ultimate recovery of these costs depends on the discovery and development of economic ore reserves or the sale of the properties or the mineral rights. &nbsp;The amounts shown for non-producing resource properties do not necessarily reflect present or future values.</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Summary of Significant Accounting Policies (continued)</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Courier; font-size:12pt; border-bottom:1pt solid #000000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align="left"><B><font face="Arial">Strategic Alliances</font></B></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align="left"><font face="Arial">The Company has entered into various agreements under which the participants earn a right to participate in the mineral property by incurring exploration expenditures in accordance with the conditions of the agreements. Upon satisfaction of the conditions of the agreement a joint venture may be formed with customary joint venture terms and provisions and then accounted for on a proportionate consolidation basis. Until a joint venture is formed only the expenditures on the properties incurred by the Company are reflected in these financial statements.</font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align="left"><B><font face="Arial">Foreign Currency Translation</font></B></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align="left"><font face="Arial">Balances of the Company denominated in foreign currencies and the accounts of its foreign subsidiaries are translated into Canadian dollars as follows:</font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align="left"><font face="Arial">(i) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;monetary assets and liabilities at period end rates;</font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align="left"><font face="Arial">(ii) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;all other assets and liabilities at historical rates; and</font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align="left"><font face="Arial">(iii) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;revenue and expense transactions at the average rate of exchange prevailing during the period.</font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align=left><font face="Arial">Exchange gains or losses arising on these translations are reflected in income in the year incurred. &nbsp;Gains and losses arising on translation of long term foreign currency denominated liabilities at each year end are reflected in income.</font> </P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align="left"><B><font face="Arial">Income Taxes</font></B></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align=left><font face="Arial">The Company accounts for income taxes using the asset and liability method. &nbsp;Under the asset and liability method, future tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. &nbsp;Future tax assets and liabilities are measured using enacted or substantively enacted tax rates expected to apply when the asset is realized or the liability settled. &nbsp;The effect on future tax assets and liabilities of a change in tax rates is recognized in income in the period that substantive enactment or enactment occurs.</font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Times New Roman; font-size:12pt" align=left><B><I><font face="Arial">Change in Accounting Policies</font></I></B></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align=left><font face="Arial">(a) Asset Retirement Obligations</font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align=left><font face="Arial">Effective January 1, 2004 the Company adopted the Canadian Institute of Chartered Accountants Standard 3110, &#147;Asset Retirement Obligations&#148; This standard requires that a liability for retirement obligations to be settled as a result of an existing law, regulation or contract be recognized when incurred and recorded at fair value on a retroactive basis. The new standard has been applied retroactively to January 1, 2002, and results previously reported have been restated as necessary.</font> </P>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align=justify><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border:0.5pt solid #000000" valign=top width=370.8><font face="Arial">&nbsp;</font></TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=71.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=center><B><font face="Arial">2003</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=center><B><font face="Arial">2002</font></B></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=370.8><P style="margin:0pt; font-family:Shruti; font-size:9.5pt"><font face="Arial">(Loss) for the period previously reported</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=71.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">(14,556)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">(4,331)</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=370.8><P style="margin:0pt; font-family:Shruti; font-size:9.5pt"><font face="Arial">(Loss) for the period restated</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=71.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">(14,496)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">(4,446)</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=370.8><P style="margin:0pt; font-family:Shruti; font-size:9.5pt"><font face="Arial">Basic and fully diluted earnings per share previously reported ($)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=71.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">(0.063)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">(0.023)</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=370.8><P style="margin:0pt; font-family:Shruti; font-size:9.5pt"><font face="Arial">Basic and fully diluted earnings per share restated ($)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=71.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">(0.062)</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">(0.023)</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=370.8><P style="margin:0pt; font-family:Shruti; font-size:9.5pt"><font face="Arial">Total shareholder equity previously reported</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=71.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">17,182</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">22,151</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=370.8><P style="margin:0pt; font-family:Shruti; font-size:9.5pt"><font face="Arial">Total shareholder equity restated</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=71.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">17,651</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">22,560</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=370.8><P style="margin:0pt; font-family:Shruti; font-size:9.5pt"><font face="Arial">Total assets previously reported</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=71.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">19,335</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">24,767</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=370.8><P style="margin:0pt; font-family:Shruti; font-size:9.5pt"><font face="Arial">Total assets restated</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=71.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">19,530</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">24,969</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; padding-left:-18pt; font-family:Shruti; font-size:9.5pt" align=left><font face="Arial">The restatement has resulted in the following notable adjustments (in thousands of Canadian Dollars)</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Summary of Significant Accounting Policies (continued)</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Courier; font-size:12pt; border-bottom:1pt solid #000000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:21.3pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:21.3pt; font-family:Shruti; font-size:12pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:21.3pt; line-height:14pt; font-family:Shruti" align=justify><font face="Arial">(b)</font></P>
<P style="margin:0pt; padding-left:21.3pt; text-indent:14.7pt; font-family:Shruti" align=justify><font face="Arial">Stock Based Compensation</font></P>
<P style="margin:0pt; padding-left:21.3pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:21.3pt; font-family:Shruti" align=justify><font face="Arial">The Company has adopted the new accounting standard of the Canadian Institute of Chartered Accountants (&#147;CICA&#148;) for the accounting of stock-based compensation expense effective January 1, 2002 on a prospective basis. &nbsp;Under this standard, compensation expense on stock options granted to non-employees is recorded as an expense in the period the options are vested using the fair value method estimated by using the Black-Scholes Option Pricing Model. &nbsp;&nbsp;&nbsp;</font></P>
<P style="margin:0pt; padding-left:21.3pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:21.3pt; font-family:Shruti" align=justify><font face="Arial">During 2002, the Company reported compensation expense associated with stock options granted to directors, officers and employees as pro-forma information in Note 4 (c). &nbsp;Effective January 1, 2003, the Company commenced recording compensation expense for stock options granted to directors, officers and employees in the Consolidated Statements of Operations. &nbsp;</font></P>
<P style="margin:0pt; padding-left:21.3pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:21.3pt; font-family:Shruti" align=justify><font face="Arial">Any consideration paid by directors, officers, employees and non-employees on exercise of stock options or purchases of shares is credited to share capital.</font></P>
<P style="margin:0pt; padding-left:21.3pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:21.3pt; line-height:14pt; font-family:Shruti" align=justify><font face="Arial">(c)</font></P>
<P style="margin:0pt; padding-left:21.3pt; text-indent:14.7pt; font-family:Shruti" align=justify><font face="Arial">Impairment of Long-lived Assets</font></P>
<P style="margin:0pt; padding-left:21.3pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:21.3pt; font-family:Shruti" align=justify><font face="Arial">Effective January 1, 2003, the Company adopted the new accounting standard of the CICA in respect of the impairment or disposal of long-lived assets. &nbsp;The new standard requires that a fair value determination be made for long-lived assets. &nbsp;During the year, the Company reviewed the carrying value of numerous long-lived assets under the new standard resulting in the recording of valuation adjustments. &nbsp;</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Courier; font-size:12pt; border-bottom:1pt solid #000000" align=right><font face="Arial"><BR></font></P>
<font face="Arial">
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<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
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<P style="margin:0pt; font-family:Shruti; font-size:12pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Notes to the Consolidated Financial Statements</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(in thousands of Canadian Dollars unless otherwise indicated and except for share and per share amounts)</font> </P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">1.</font></B></P>
<P style="margin:0pt; text-indent:42.55pt; font-family:Shruti" align="left"><B><font face="Arial">Investment at Cost</font></B></P>
<P style="margin:0pt; padding-left:42.55pt; font-family:Shruti" align="left"><font face="Arial">On May 9, 2002 the Company participated in a private placement of the purchase of shares of Motapa Diamonds Inc. (&#147;Motapa&#148;) in an amount of US$50 ($79 Canadian). &nbsp;The shares of Motapa are listed on the TSX Venture Exchange in Canada. &nbsp;Motapa Diamonds Inc. is participating in a strategic alliance with the Company on the Mulonga Plain diamond exploration project in Zambia.</font></P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Courier; font-size:12pt; border-bottom:2.25pt solid #000000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">2.</font></B></P>
<P style="margin:0pt; text-indent:42.55pt; font-family:Shruti" align="left"><B><font face="Arial">Capital Assets</font></B></P>
<P style="margin:0pt; text-indent:288pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=180></TD><TD valign=bottom width=288 colspan="3">
      <p align="center"><font face="Arial"><B>2004</B></font>
</TD></TR>
  <TR><TD valign=top width=180><font face="Arial">&nbsp;</font></TD><TD style="border-top:1.5pt solid #000000" valign=bottom width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial"><U>Cost</U> <SUP>(1)</SUP></font></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=bottom width=96><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">Accumulated</font></P>
<P style="margin:0pt; font-family:Shruti" align=center><U><font face="Arial">Amortization</font></U></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=bottom width=96><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">Net</font></P>
<P style="margin:0pt; font-family:Shruti" align=center><U><font face="Arial">Book Value</font></U></P>
</TD></TR>
<TR><TD valign=top width=180><P style="margin:0pt; font-family:Shruti"><font face="Arial">Land - plant sites</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$1,541</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=center><B><font face="Arial">$ &nbsp;&nbsp;&nbsp;-</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$1,541</font></B></P>
</TD></TR>
<TR><TD valign=top width=180><P style="margin:0pt; font-family:Shruti"><font face="Arial">Plant and equipment</font></P>
</TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=180><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;- producing <SUP>(2)</SUP></font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">4,967</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">497</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">4,470</font></B></P>
</TD></TR>
<TR><TD valign=top width=180><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;- non-producing <SUP>(3)</SUP> </font> </P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">887</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">887</font></B></P>
</TD></TR>
<TR><TD valign=top width=180><P style="margin:0pt; font-family:Shruti"><font face="Arial">Office equipment</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">869</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">786</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">83</font></B></P>
</TD></TR>
<TR><TD valign=top width=180><P style="margin:0pt; font-family:Shruti"><font face="Arial">Vehicles</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">451</font></B></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">274</font></B></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">177</font></B></P>
</TD></TR>
<TR><TD valign=top width=180><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$8,715</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$1,557</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$7,158</font></B></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:288pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=180></TD><TD valign=bottom width=288 colspan="3">
      <p align="center"><font face="Arial">2003</font>
</TD></TR>
  <TR><TD valign=top width=180><font face="Arial">&nbsp;</font></TD><TD style="border-top:1.5pt solid #000000" valign=bottom width=96><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial"><U>Cost</U> <SUP>(1)</SUP></font></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=bottom width=96><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">Accumulated</font></P>
<P style="margin:0pt; font-family:Shruti" align=center><U><font face="Arial">Amortization</font></U></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=bottom width=96><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">Net</font></P>
<P style="margin:0pt; font-family:Shruti" align=center><U><font face="Arial">Book Value</font></U></P>
</TD></TR>
<TR><TD valign=top width=180><P style="margin:0pt; font-family:Shruti"><font face="Arial">Land - plant sites</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$1,833</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">$ &nbsp;&nbsp;&nbsp;&nbsp;-</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$1,833</font></P>
</TD></TR>
<TR><TD valign=top width=180><P style="margin:0pt; font-family:Shruti"><font face="Arial">Plant and equipment</font></P>
</TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=180><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;- producing <SUP>(2)</SUP></font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">4,529</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">451</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">4,078</font></P>
</TD></TR>
<TR><TD valign=top width=180><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;- non-producing <SUP>(3)</SUP> </font> </P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1,596</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1,596</font></P>
</TD></TR>
<TR><TD valign=top width=180><P style="margin:0pt; font-family:Shruti"><font face="Arial">Office furniture</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">771</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">749</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">22</font></P>
</TD></TR>
<TR><TD valign=top width=180><P style="margin:0pt; font-family:Shruti"><font face="Arial">Vehicles</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">395</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">258</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">137</font></P>
</TD></TR>
<TR><TD valign=top width=180><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$9,124</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$1,458</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$7,666</font></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt; padding-left:49.65pt; text-indent:-21.3pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:56.7pt; text-indent:-14.15pt; line-height:14pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial">(1)</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial">Cost is comprised of the original cost of the asset, less previous write downs, removal of cost for disposals and government grants, and includes the capitalized value of the estimated asset retirement obligations.</font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:56.7pt; text-indent:-14.15pt; line-height:14pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial">(2)</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial">The producing plant and equipment in 2004 and 2003 relates to the Barbrook operation.</font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:56.7pt; text-indent:-14.15pt; line-height:14pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial">(3)</font> </P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial">The net book value of non-producing plant and equipment at December 31, 2004 represents Eersteling.</font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:42.55pt; font-family:Shruti" align=justify><font face="Arial">The recoverability of the carrying amount of the Barbrook capital assets is dependent upon the availability of sufficient funding, the ability of the Company to bring the property into production, the price of gold, the exchange rate of the South African rand relative to the US dollar and the undertaking of a profitable mining operation. The recoverability of the carrying amount of the Eersteling capital assets is dependent upon the availability of sufficient funding to bring the property into profitable production or the value realized from the possible disposal of the assets. &nbsp;As a result of these uncertainties, the actual amount recovered may vary significantly from the carrying amount.</font></P>
<font face="Arial">
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<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
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<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Notes to the Consolidated Financial Statements</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(in thousands of Canadian Dollars unless otherwise indicated and except for share and per share amounts)</font> </P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">3.</font></B></P>
<P style="margin:0pt; text-indent:28.35pt; font-family:Shruti" align="left"><B><font face="Arial">Mineral Properties</font></B></P>
<P style="text-indent: 0; font-family: Shruti; margin: 0pt" align="center"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=279.467></TD><TD valign=bottom width=252 colspan="3">
      <p align="center"><font face="Arial"><B>2004</B></font>
</TD></TR>
  <TR><TD valign=top width=279.467><font face="Arial">&nbsp;</font></TD><TD style="border-top:1.5pt solid #000000" valign=bottom width=60.133><P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=center><font face="Arial"><U>Cost</U> <SUP>(1)</SUP></font></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=bottom width=96><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">Accumulated</font></P>
<P style="margin:0pt; font-family:Shruti" align=center><U><font face="Arial">Amortization</font></U></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=bottom width=96><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">Net&nbsp;</font></P>
      <P style="margin:0pt; font-family:Shruti" align=center><font face="Arial"> <U>Book Value</U></font></P>
</TD></TR>
<TR><TD valign=top width=279.467><P style="margin:0pt; font-family:Shruti"><font face="Arial">Producing:</font></P>
</TD><TD valign=top width=60.133><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=279.467><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;Barbrook, South Africa - gold property</font> </P>
</TD><TD valign=top width=60.133><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$6,132</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$646</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$5,486</font></B></P>
</TD></TR>
<TR><TD valign=top width=279.467><P style="margin:0pt; font-family:Shruti"><font face="Arial">Non-producing &#150; care and maintenance:</font></P>
</TD><TD valign=top width=60.133><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=279.467><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;Eersteling, South Africa - gold property</font></P>
</TD><TD valign=top width=60.133><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">-</font></B></P>
</TD></TR>
<TR><TD valign=top width=279.467><P style="margin:0pt; font-family:Shruti"><font face="Arial">Non-producing - exploration:</font></P>
</TD><TD valign=top width=60.133><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=279.467><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;Rooiport and Roodeport, South Africa</font></P>
</TD><TD valign=top width=60.133><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">1,671</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">1,671</font></B></P>
</TD></TR>
<TR><TD valign=top width=279.467><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;Nunavut, Canada</font></P>
</TD><TD valign=top width=60.133><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">750</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">750</font></B></P>
</TD></TR>
<TR><TD valign=top width=279.467><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;Zambia</font></P>
</TD><TD valign=top width=60.133><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">1,041</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">1,041</font></B></P>
</TD></TR>
<TR><TD valign=top width=279.467><font face="Arial">&nbsp;</font></TD><TD style="border-top:1pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=60.133><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$9,594</font></B></P>
</TD><TD style="border-top:1pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$646</font></B></P>
</TD><TD style="border-top:1pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$8,948</font></B></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt; font-family:Courier; font-size:12pt; color:#FF0000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:288pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=279.467></TD><TD valign=top width=252 colspan="3">
      <p align="center"><font face="Arial">2003</font>
</TD></TR>
  <TR><TD valign=top width=279.467><font face="Arial">&nbsp;</font></TD><TD style="border-top:1.5pt solid #000000" valign=top width=60.133><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=center><font face="Arial"><U>Cost</U> <SUP>(1)</SUP></font></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=bottom width=96><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">Accumulated</font></P>
<P style="margin:0pt; font-family:Shruti" align=center><U><font face="Arial">Amortization</font></U></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=bottom width=96><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">Net&nbsp;</font></P>
      <P style="margin:0pt; font-family:Shruti" align=center><font face="Arial"> <U>Book Value</U></font></P>
</TD></TR>
<TR><TD valign=top width=279.467><P style="margin:0pt; font-family:Shruti"><font face="Arial">Producing:</font></P>
</TD><TD valign=top width=60.133><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=279.467><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;Barbrook, South Africa - gold property</font> </P>
</TD><TD valign=top width=60.133><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$4,692</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$17</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$4,675</font></P>
</TD></TR>
<TR><TD valign=top width=279.467><P style="margin:0pt; font-family:Shruti"><font face="Arial">Non-producing &#150; care and maintenance:</font></P>
</TD><TD valign=top width=60.133><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=279.467><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;Eersteling, South Africa - gold property</font></P>
</TD><TD valign=top width=60.133><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">810</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">67</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">743</font></P>
</TD></TR>
<TR><TD valign=top width=279.467><P style="margin:0pt; font-family:Shruti"><font face="Arial">Non-producing - exploration:</font></P>
</TD><TD valign=top width=60.133><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD><TD valign=top width=96><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=279.467><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;Nunavut, Canada</font></P>
</TD><TD valign=top width=60.133><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">750</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">750</font></P>
</TD></TR>
<TR><TD valign=top width=279.467><P style="margin:0pt; font-family:Shruti"><font face="Arial">&nbsp;&nbsp;&nbsp;Zambia</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=60.133><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1,044</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">-</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1,044</font></P>
</TD></TR>
<TR><TD valign=top width=279.467><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=60.133><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$7,296</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$84</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$7,212</font></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:49.65pt; text-indent:-21.3pt; line-height:14pt; font-family:Shruti" align="left"><font face="Arial">(1)</font></P>
<P style="margin:0pt; padding-left:49.65pt; font-family:Shruti" align="left"><font face="Arial">Cost is comprised of the original cost of the asset, less previous write downs, removal of cost for disposals and government grants.</font></P>
<P style="margin:0pt; padding-left:28.35pt; text-indent:295.65pt; font-family:Shruti" align="left"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
<P style="margin:0pt; padding-left:28.35pt; font-family:Shruti" align="left"><font face="Arial">The Company has entered into strategic alliances with third parties on a Canadian property and a Zambian property valued at $750 and $1,041 respectively. &nbsp;The third parties may earn varying percentage interests in these properties by carrying out exploration work on the properties.</font></P>
<P style="margin:0pt; padding-left:28.35pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:28.35pt; font-family:Shruti" align="left"><font face="Arial">The recoverability of the carrying amount of the Canadian, South African and Zambian mineral properties is dependent upon the availability of sufficient funding to bring the properties into commercial production, the price of the products to be recovered, the exchange rate of the local currency relative to the US dollar and the undertaking of profitable mining operations. &nbsp;As a result of these uncertainties, the actual amount recovered may vary significantly from the carrying amount. &nbsp;<BR>
</font></P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Courier; font-size:12pt; border-bottom:2.25pt solid #000000"><font face="Arial"><BR></font></P>
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<P style="margin:0pt; padding-left:28.35pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:1.35pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:1.35pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Notes to the Consolidated Financial Statements</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(in thousands of Canadian Dollars unless otherwise indicated and except for share and per share amounts)</font> </P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial" size="2"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti; font-size:12pt" align="left"><B><font face="Arial" size="2">4.</font></B></P>
<P style="margin:0pt; text-indent:28.35pt; font-family:Shruti; font-size:12pt" align="left"><B><font face="Arial" size="2">Share Capital</font></B></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial" size="2"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:49.65pt; text-indent:-21.3pt; line-height:14pt; font-family:Shruti" align="left"><font face="Arial">(a)</font> </P>
<P style="margin:0pt; padding-left:49.65pt; font-family:Shruti" align="left"><font face="Arial">Authorized</font></P>
<P style="margin:0pt; padding-left:49.65pt; font-family:Shruti" align="left"><font face="Arial">An unlimited number of common shares.</font></P>
<P style="margin:0pt; padding-left:49.65pt; font-family:Shruti" align="left"><font face="Arial">An unlimited number of preference shares.</font></P>
<P style="margin:0pt; padding-left:49.65pt; text-indent:-21.3pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:49.65pt; text-indent:-21.3pt; line-height:14pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial">(b)</font></P>
<P style="margin:0pt; padding-left:49.65pt; font-family:Shruti" align="left"><font face="Arial">Issued</font></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=311.133><font face="Arial">&nbsp;</font></TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti"><U><font face="Arial">Number of Shares</font></U></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; padding-right:1.1pt; text-indent:36.55pt; font-family:Shruti"><U><font face="Arial">Amount</font></U></P>
</TD></TR>
<TR><TD valign=top width=311.133><P style="margin:0pt; text-indent:0.55pt; font-family:Shruti"><font face="Arial">Common shares</font></P>
</TD><TD valign=top width=132.267><font face="Arial">&nbsp;</font></TD><TD valign=top width=113.4><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=311.133><P style="margin:0pt; text-indent:0.55pt; font-family:Shruti"><font face="Arial">Balance, December 31, 2001</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti"><font face="Arial">165.202,115</font></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$143,986</font></P>
</TD></TR>
<TR><TD valign=top width=311.133><P style="margin:0pt; text-indent:0.55pt; font-family:Shruti"><font face="Arial">Issued pursuant to private placements</font> </P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti"><font face="Arial">27,409,655</font></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">4,023</font></P>
</TD></TR>
<TR><TD valign=top width=311.133><P style="margin:0pt; text-indent:0.55pt; font-family:Shruti"><font face="Arial">Warrants exercised</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti"><font face="Arial">18,018,000</font></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1,474</font></P>
</TD></TR>
<TR><TD valign=top width=311.133><P style="margin:0pt; text-indent:0.55pt; font-family:Shruti"><font face="Arial">Shares Issued for debt &#150; note <SUP>(2)</SUP></font></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=132.267><P style="margin:0pt; font-family:Shruti"><font face="Arial">1,165,500</font></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=113.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">140</font></P>
</TD></TR>
<TR><TD valign=top width=311.133><P style="margin:0pt; text-indent:0.55pt; font-family:Shruti"><font face="Arial">&nbsp;Balance, December 31, 2002</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti"><font face="Arial">211,795,270</font></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">149,623</font></P>
</TD></TR>
<TR><TD valign=top width=311.133><P style="margin:0pt; text-indent:0.55pt; font-family:Shruti"><font face="Arial">&nbsp;Issued pursuant to private placements</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti"><font face="Arial">25,280,000</font></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">&nbsp;5,674</font></P>
</TD></TR>
<TR><TD valign=top width=311.133><P style="margin:0pt; text-indent:0.55pt; font-family:Shruti"><font face="Arial">&nbsp;Warrants exercised</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti"><font face="Arial">15,093,252</font></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">3,814</font></P>
</TD></TR>
<TR><TD valign=top width=311.133><P style="margin:0pt; text-indent:0.55pt; font-family:Shruti"><font face="Arial">&nbsp;Shares issued from exercise of stock options</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti"><font face="Arial">106,475</font></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">&nbsp;40</font></P>
</TD></TR>
<TR><TD valign=top width=311.133><P style="margin:0pt; text-indent:0.55pt; font-family:Shruti"><font face="Arial">&nbsp;Balance, December 31, 2003</font></P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=132.267><P style="margin:0pt; font-family:Shruti"><font face="Arial">252,274,997</font></P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=113.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$159,151</font></P>
</TD></TR>
<TR><TD valign=top width=311.133><P style="margin:0pt; text-indent:0.55pt; font-family:Shruti"><font face="Arial">&nbsp;Issued pursuant to private placements</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti"><font face="Arial">45,388,175</font></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">&nbsp;13,392</font></P>
</TD></TR>
<TR><TD valign=top width=311.133><P style="margin:0pt; text-indent:0.55pt; font-family:Shruti"><font face="Arial">&nbsp;Warrants exercised</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti"><font face="Arial">3,449,114</font></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">761</font></P>
</TD></TR>
<TR><TD valign=top width=311.133><P style="margin:0pt; font-family:Shruti"><font face="Arial"><B>&nbsp;</B>Balance, December 31, 2004</font></P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=132.267><P style="margin:0pt; font-family:Shruti"><font face="Arial">301,112,286</font></P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=113.4><P style="margin:0pt; padding-left:15.3pt; text-indent:6.3pt; font-family:Shruti" align=right><font face="Arial">$173,304</font></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:49.65pt; text-indent:-21.3pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:49.65pt; text-indent:-21.3pt; line-height:14pt; font-family:Shruti" align=left><font face="Arial">(1)</font></P>
<P style="margin:0pt; padding-left:49.65pt; font-family:Shruti" align=left><font face="Arial">On April 12, 2002, the Company completed a private placement for proceeds of $3,000 comprised of gross cash consideration of $2,500 and the retirement of debt of $500. &nbsp;The issue price was $0.145 per unit, each unit being comprised of one common share and one half common share purchase warrant exercisable at $0.195 per whole common share purchase warrant for a period of two years from the issue date. &nbsp;A total of 20,689,655 shares were issued pursuant to the private placement of which 3,448,029 were issued for the retirement of debt. &nbsp;Share issue costs of $328 for the private placement have been charged to share capital. &nbsp;In addition, whole broker warrants in the amount of 1,724,163 were issued exercisable at $0.195 per warrant. &nbsp;A value of $0.06 per warrant was assigned to the broker compensation warrants for a total consideration of $103.</font></P>
<P style="margin:0pt; padding-left:49.65pt; text-indent:-21.3pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:49.65pt; text-indent:-21.3pt; line-height:14pt; font-family:Shruti" align=left><font face="Arial">(2)</font></P>
<P style="margin:0pt; padding-left:49.65pt; font-family:Shruti" align=left><font face="Arial">A loan convertible into common shares of the Company was redeemed and converted during the third quarter of 2002 into 1,165,500 common shares valued at $140.</font></P>
<P style="margin:0pt; padding-left:49.5pt; text-indent:-49.5pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:49.65pt; text-indent:-21.3pt; line-height:14pt; font-family:Shruti" align=left><font face="Arial">(3)</font></P>
<P style="margin:0pt; padding-left:49.65pt; font-family:Shruti" align=left><font face="Arial">During December 2002, the Company commenced a private placement to raise $3,000. &nbsp;As at December 31, 2002 the first closing raised gross proceeds of $1,680 resulting in the issuance of 6,720,000 common units. &nbsp;The balance of the offering was received on January 6, 2003 upon completion of the second closing (see (4) below). &nbsp;A total of 12 million units priced at $0.25 per unit were subscribed for both closings. &nbsp;Each unit consisted of one common share and one half common share purchase warrant. &nbsp;Each full warrant entitled the holder to purchase one common share at a price of $0.33 for a period of one year from the date of issue. &nbsp;Share issue costs for the first closing of $152 have been charged to share capital in 2002. &nbsp;A total of 672,000 broker warrants were issued on behalf of the first closing under the same terms and conditions as noted above. &nbsp;A value of $0.11 per warrant
 was assigned to broker compensation warrants for a total consideration of $74.</font></P>
<P style="margin:0pt; padding-left:49.65pt; text-indent:130.35pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:49.65pt; text-indent:-21.3pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:49.65pt; text-indent:-21.3pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Notes to the Consolidated Financial Statements</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(in thousands of Canadian Dollars unless otherwise indicated and except for share and per share amounts)</font> </P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">4.</font> </B></P>
<P style="margin:0pt; text-indent:28.35pt; font-family:Shruti" align="left"><font face="Arial"><B>Share Capital </B>(continued)</font></P>
<P style="margin:0pt; padding-left:49.65pt; text-indent:-21.3pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:49.65pt; text-indent:-21.3pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:49.65pt; text-indent:-21.3pt; line-height:14pt; font-family:Shruti" align=justify><font face="Arial">(4)</font></P>
<P style="margin:0pt; padding-left:49.65pt; font-family:Shruti" align=justify><font face="Arial">On January 6, 2003, the Company concluded the private placement described above with the second closing for gross proceeds of $1,320 resulting in the issuance of 5,280,000 units. &nbsp;A further 528,000 broker warrants were issued under
the same terms and conditions as noted above. &nbsp;A value of $0.11 per warrant was assigned to the broker compensation warrants for total consideration of $58. &nbsp;Share issue costs associated with the second closing have been charged to share capital in 2003 in an amount of &nbsp;$119.</font></P>
<P style="margin:0pt; padding-left:49.65pt; text-indent:-21.3pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:49.65pt; text-indent:-21.3pt; font-family:Shruti" align=justify><font face="Arial">(5) &nbsp;&nbsp;During the third quarter of 2003, the Company concluded a private placement financing for $5,000 gross proceeds comprised of 20,000,000 units. &nbsp;Each unit is comprised of one common share and one half common share purchase warrant issued at $0.25 per unit. &nbsp;In addition, a total of 2,000,000 whole broker warrants were issued with each warrant exchangeable for one whole common share. &nbsp;Whole warrants are exchangeable for shares at $0.35 per share for a period of eighteen months from the date of closing. &nbsp;The 2,000,000 broker compensation warrants issued upon closing were assigned a value of $0.08 per warrant for total considerations of $160. &nbsp;Share issue costs of $544 have been charged to share capital.</font> </P>
<P style="margin:0pt; text-indent:49.65pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:49.65pt; text-indent:-21.3pt; line-height:14pt; font-family:Shruti" align=justify><font face="Arial">(6)</font></P>
<P style="margin:0pt; padding-left:49.65pt; font-family:Shruti" align=justify><font face="Arial">During the first half of 2004, Caledonia raised a gross amount $14,978 from a private placement by the issuance of 45,388,175 units consisting of one common share and one-half common share purchase warrant. &nbsp;Each unit is priced at $0.33 per unit and the common share purchase warrants are exercisable for one common share at $0.55 per whole warrant for a period of eighteen months from the date of issuance.</font></P>
<P style="margin:0pt; padding-left:49.65pt; text-indent:-21.3pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:49.65pt; font-family:Shruti" align=justify><font face="Arial">The private placement agents were paid a commission of 9% of
the gross proceeds raised and whole common share purchase warrants equal to 10% of the total units sold. &nbsp;The agent compensation warrants are exercisable for one common share at $0.55 per warrant for a period of eighteen months from the date of issuance. &nbsp;A total of 4,538,818 agent compensation warrants were issued at an assigned value of $161 . &nbsp;Cash commissions and expenses paid amounted to $1,425.</font></P>
<P style="margin:0pt; padding-left:49.65pt; text-indent:-21.3pt; line-height:11pt; font-family:Shruti; font-size:9pt" align=justify><font face="Arial">&nbsp;&nbsp;</font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:49.65pt; text-indent:-21.3pt; line-height:14pt; font-family:Shruti; font-size:9pt" align=justify><font face="Arial">(7)</font></P>
<P style="margin:0pt; padding-left:49.65pt; font-family:Shruti; font-size:9pt" align=justify><font face="Arial">The fair value of the warrants noted above was estimated using the Black-Scholes Option Pricing Model with the following assumptions for the periods ended December 31, 2004, 2003 and 2002</font></P>
<P style="margin:0pt; padding-left:56.7pt; text-indent:-21.2pt; font-family:Shruti; font-size:9pt"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR><TD style="border:0.5pt solid #000000" valign=top width=171.133><font face="Arial">&nbsp;</font></TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=55.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><U><font face="Arial">2004</font></U></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=48.467><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><U><font face="Arial">2003</font></U></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=48.467><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><U><font face="Arial">2002</font></U></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=171.133><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">Risk-free interest rate</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=55.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">2.25%</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=48.467><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">3.63%</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=48.467><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">3.63%</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=171.133><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">Expected dividend yield</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=55.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">nil</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=48.467><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">nil</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=48.467><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=171.133><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">Expected stock price volatility</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=55.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">64-65%</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=48.467><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">48%</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=48.467><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">48%</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=171.133><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">Expected option life in years</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=55.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">1</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=48.467><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">1</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=48.467><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">1</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; padding-left:28.35pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
</font>
<P style="margin:0pt; padding-left:28.35pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:27pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-top:3pt; font-family:Shruti; font-size:12pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt" align=right><B><font face="Arial">Notes to the Consolidated Financial Statements</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(in thousands of Canadian Dollars unless otherwise indicated and except for share and per share amounts)</font> </P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; padding-left:27pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">4.</font> </B></P>
<P style="margin:0pt; text-indent:56.7pt; font-family:Shruti" align="left"><font face="Arial"><B>Share Capital </B>(continued)</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align="left">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:28.35pt; line-height:14pt; font-family:Shruti" align="left"><font face="Arial">(c)</font> </P>
<P style="margin:0pt; padding-left:28.35pt; text-indent:14.2pt; font-family:Shruti" align="left"><font face="Arial">Stock Option Plans and Stock-Based Compensation</font></P>
<P style="margin:0pt; padding-left:-1.15pt; text-indent:21.55pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align="left"><font face="Arial">The Company has established incentive stock option plans (the &quot;Plans&quot;) for employees, officers, directors, consultants and other service providers. &nbsp;Under the Plans, as at December 31, 2004, the Company has the following options exercisable and outstanding:</font></P>
<P style="margin:0pt; text-indent:21.55pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR><TD valign=top width=136.533><P style="margin:0pt; font-family:Shruti; font-size:9pt"><U><font face="Arial">Number of Options</font></U></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti; font-size:9pt"><U><font face="Arial">Exercise Price</font></U></P>
</TD><TD valign=top width=145><P style="margin:0pt; font-family:Shruti; font-size:9pt"><U><font face="Arial">Expiry Date</font></U></P>
</TD></TR>
<TR><TD valign=top width=136.533><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">410,700</font></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">&nbsp;$ 0.750</font></P>
</TD><TD valign=top width=145><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">April 28, 2005</font></P>
</TD></TR>
<TR><TD valign=top width=136.533><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">813,000</font></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">&nbsp;$ 0.330</font></P>
</TD><TD valign=top width=145><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">February 9, 2008</font></P>
</TD></TR>
<TR><TD valign=top width=136.533><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">9,950,000</font></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">&nbsp;$ 0.235</font></P>
</TD><TD valign=top width=145><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">April 24, 2012</font></P>
</TD></TR>
<TR><TD valign=top width=136.533><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">225,000</font></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">&nbsp;$ 0.345</font></P>
</TD><TD valign=top width=145><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">June 2, 2012</font></P>
</TD></TR>
<TR><TD valign=top width=136.533><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">500,000</font></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">&nbsp;$ 0.280</font></P>
</TD><TD valign=top width=145><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">November 4, 2013</font></P>
</TD></TR>
<TR><TD valign=top width=136.533><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">1,010,000</font></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">&nbsp;$ 0.260</font></P>
</TD><TD valign=top width=145><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">April 29, 2014</font></P>
</TD></TR>
<TR><TD valign=top width=136.533><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">200,000</font></P>
</TD><TD valign=top width=113.4><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">&nbsp;$ 0.260</font></P>
</TD><TD valign=top width=145><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">August 15, 2014</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; padding-left:-1.15pt; text-indent:21.55pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti"><font face="Arial">The continuity of the options granted, exercised and cancelled under the Plans during 2004 and 2003 are as follows:</font></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=255.2><font face="Arial">&nbsp;</font></TD><TD valign=top width=122.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><U><font face="Arial">Number of Options</font></U></P>
</TD><TD valign=top width=179.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align="center"><U><font face="Arial">Weighted Avg. Exercise Price</font></U></P>
</TD></TR>
<TR><TD valign=top width=255.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Options outstanding &nbsp;at December 31, 2001</font> </P>
</TD></center><TD valign=top width=122.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align="right"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,565,800</font></P>
</TD><center><TD valign=top width=179.6><P style="font-family: Shruti; font-size: 9pt; text-indent: 0; margin: 0pt" align="center"><font face="Arial">&nbsp;$0.48</font></P>
</TD></TR>
<TR><TD valign=top width=255.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Options granted</font></P>
</TD><TD valign=top width=122.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">10,225,000</font></P>
</TD><TD valign=top width=179.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">$0.24</font></P>
</TD></TR>
<TR><TD valign=top width=255.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Options cancelled</font></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=122.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(110,000)</font></P>
</TD><TD valign=top width=179.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">($0.33)</font></P>
</TD></TR>
<TR><TD valign=top width=255.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Options outstanding at December 31, 2002</font></P>
</TD><TD valign=top width=122.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">12,680,800</font></P>
</TD><TD valign=top width=179.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">$0.29</font></P>
</TD></TR>
<TR><TD valign=top width=255.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Granted</font></P>
</TD><TD valign=top width=122.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">500,000</font></P>
</TD><TD valign=top width=179.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">$0.28</font></P>
</TD></TR>
<TR><TD valign=top width=255.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Exercised</font></P>
</TD><TD valign=top width=122.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(106,475)</font></P>
</TD><TD valign=top width=179.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">($0.38)</font></P>
</TD></TR>
<TR><TD valign=top width=255.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Cancelled or expired</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=122.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(1,175,625)</font></P>
</TD><TD valign=top width=179.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">($0.50)</font></P>
</TD></TR>
<TR><TD valign=top width=255.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Options outstanding at December 31, 2003</font></P>
</TD><TD valign=top width=122.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">11,898,700</font></P>
</TD><TD valign=top width=179.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">$0.26</font></P>
</TD></TR>
<TR><TD valign=top width=255.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Granted</font></P>
</TD><TD valign=top width=122.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">1,210,000</font></P>
</TD><TD valign=top width=179.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">$0.26</font></P>
</TD></TR>
<TR><TD valign=top width=255.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Options outstanding at December 31, 2004</font></P>
</TD><TD style="border-top:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=122.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">13,108,700</font></P>
</TD><TD valign=top width=179.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">$0.26</font></P>
</TD></TR>
<TR><TD valign=top width=255.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Options exercisable at December 31, 2004</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=122.8><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">12,910,700</font></P>
</TD><TD valign=top width=179.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">$0.26</font></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt; font-family:Courier; font-size:12pt">&nbsp;</P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align="left"><font face="Arial">The options to purchase common shares noted above, have been granted to directors, officers, employees and service providers at exercise prices determined by reference to the market value of the common shares on the date of grant. &nbsp;The vesting of options is made at the discretion of the board of directors at the time the options are granted. As of December 31, 2004 there are 12,220,625 stock options available to grant</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=justify><font face="Arial">Effective January 1, 2003 the Company commenced recording compensation expense on a prospective basis &nbsp;in the Consolidated Statements of Operations for stock options granted to directors, officers and employees using the fair value method. &nbsp;During 2004, stock option expense of $195 for the grant of 1,210,000 options was charged to expense and credited to contributed surplus. &nbsp;During 2003 stock option expense of $76 was recorded in respect of 500,000 stock options granted. Of the stock options granted to directors in 2002, an amount of 1,000,000 options were granted</font></P>
<P style="line-height: 14pt; font-family: Courier; font-size: 14pt; margin: 0pt; padding-top: 3pt" align=right><font face="Arial"><BR></font></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<p style="line-height: 14pt; font-family: Courier; font-size: 14pt; margin: 0pt; padding-top: 3pt" align="right">&nbsp;</p>
<p style="line-height: 14pt; font-family: Courier; font-size: 14pt; margin: 0pt; padding-top: 3pt" align="right">&nbsp;</p>
<p style="line-height: 14pt; font-family: Courier; font-size: 14pt; margin: 0pt; padding-top: 3pt" align="right">&nbsp;</p>
<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Notes to the Consolidated Financial Statements</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(in thousands of Canadian Dollars unless otherwise indicated and except for share and per share amounts)</font> </P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">4.</font> </B></P>
<P style="margin-top:0pt; margin-bottom:-14pt; text-indent:56.7pt; line-height:14pt; font-family:Shruti" align="left"><font face="Arial"><B>Share Capital </B>(continued)</font></P>
<P style="margin:0pt; text-indent:181.1pt; font-family:Shruti" align="left">&nbsp;</P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial">as compensation for legal services. &nbsp;The fair value assigned to the options granted for legal services amounted to $209 and the amount was recorded as an expense and credited to contributed surplus. &nbsp;The fair value of the remaining 9,225,000 stock options granted in 2002 was valued at $1,916 and disclosed as pro-forma information as noted below. For the year ended December 31, 2001, no stock options were granted to directors, officers and employees.</font></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-9pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align="left"><font face="Arial">The fair value of compensation expenses noted above was estimated using the Black-Scholes Option Pricing Model with the following assumptions for the periods ended &nbsp;December 31, 2004, 2003 and 2002.</font></P>
<P style="margin:0pt; padding-left:56.7pt; text-indent:160.4pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR><TD style="border:0.5pt solid #000000" valign=top width=188.6><font face="Arial">&nbsp;</font></TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=75.2><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">2004</font></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=52.267><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">2003</font></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=52.267><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">2002</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=188.6><P style="margin:0pt; font-family:Shruti"><font face="Arial">Risk-free interest rate</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=75.2><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">2.25%</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=52.267><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">3.63%</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=52.267><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">3.63%</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=188.6><P style="margin:0pt; font-family:Shruti"><font face="Arial">Expected dividend yield</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=75.2><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=52.267><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">nil</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=52.267><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=188.6><P style="margin:0pt; font-family:Shruti"><font face="Arial">Expected stock price volatility</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=75.2><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">100-113%</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=52.267><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">48%</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=52.267><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">48%</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=188.6><P style="margin:0pt; font-family:Shruti"><font face="Arial">Expected option life in years</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=75.2><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">3</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=52.267><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">3</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=52.267><P style="margin:0pt; font-family:Shruti" align=center><font face="Arial">3</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align="left"><font face="Arial">The pro-forma effect on net loss and loss per share for the period ended December 31, 2002 of the actual results had the Company accounted for the 9,225,000 stock options granted to directors, officers and employees using the fair value method is as follows:</font></P>
<P style="margin:0pt; text-indent:361.1pt; line-height:8pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align="left"><font face="Arial">Net loss for the period</font> </P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:56.7pt; line-height:14pt; font-family:Shruti" align="left"><font face="Arial">Reported</font></P>
<P style="margin:0pt; padding-left:56.7pt; text-indent:196.4pt; font-family:Shruti" align="left"><font face="Arial">$4,446</font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:56.7pt; line-height:14pt; font-family:Shruti" align="left"><font face="Arial">Compensation expense</font></P>
<P style="margin:0pt; padding-left:56.7pt; text-indent:196.4pt; font-family:Shruti" align="left"><font face="Arial">$<U>1,916</U></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:56.7pt; line-height:14pt; font-family:Shruti" align="left"><font face="Arial">Pro-forma</font></P>
<P style="margin:0pt; padding-left:56.7pt; text-indent:196.4pt; font-family:Shruti" align="left"><font face="Arial">$<U>6,362</U></font></P>
<P style="margin:0pt; padding-left:56.7pt; line-height:10pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align="left"><font face="Arial">Basic loss per share</font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:56.7pt; line-height:14pt; font-family:Shruti" align="left"><font face="Arial">Reported</font></P>
<P style="margin:0pt; padding-left:56.7pt; text-indent:196.4pt; font-family:Shruti" align="left"><font face="Arial">$<U> 0.023</U></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:56.7pt; line-height:14pt; font-family:Shruti" align="left"><font face="Arial">Pro-forma</font></P>
<P style="margin:0pt; padding-left:56.7pt; text-indent:196.4pt; font-family:Shruti" align="left"><font face="Arial">$<U> 0.033</U> &nbsp;&nbsp;&nbsp;&nbsp;</font></P>
<P style="margin:0pt; padding-left:56.7pt; line-height:10pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti"><font face="Arial">Option pricing models require the input of highly subjective assumptions including the expected price volatility. &nbsp;Changes in the subjective input assumptions can materially affect the fair value estimate, and therefore the existing models do not necessarily provide a reliable single measure of the fair value of the Company&#146;s stock options.</font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:28.35pt; line-height:14pt; font-family:Shruti" align="left"><font face="Arial">(d)</font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:28.35pt; text-indent:28.35pt; line-height:14pt; font-family:Shruti" align="left"><font face="Arial">Warrants &nbsp;</font></P>
<P style="margin:0pt; padding-left:28.35pt; text-indent:79.65pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:28.35pt; line-height:10pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti"><font face="Arial">The Company has issued the following common share purchase warrants pursuant to private placements which are outstanding as of December 31, 2004:</font></P>
<P style="margin:0pt; padding-left:-1.15pt; text-indent:21.55pt; line-height:8pt; font-family:Courier; font-size:8pt"><font face="Arial"><BR></font></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=141.733><P style="margin:0pt; font-family:Shruti; font-size:9pt"><U><font face="Arial">Number of Warrants</font></U></P>
</TD><TD valign=top width=122.867><P style="margin:0pt; font-family:Shruti; font-size:9pt"><U><font face="Arial">Shares for&nbsp;</font></U></P>
      <P style="margin:0pt; font-family:Shruti; font-size:9pt"><U><font face="Arial"> Warrants</font></U></P>
</TD><TD valign=top width=102.2><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><U><font face="Arial">Exercise Price</font></U></P>
</TD><TD valign=top width=134><P style="margin:0pt; font-family:Shruti; font-size:9pt"><U><font face="Arial">Expiry Date</font></U></P>
</TD></TR>
<TR><TD valign=top width=141.733><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">12,000,000</font></P>
</TD><TD valign=top width=122.867><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">1 for 1</font></P>
</TD><TD valign=top width=102.2><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">$0.350</font></P>
</TD><TD valign=top width=134><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">February 6, 2005</font></P>
</TD></TR>
<TR><TD valign=top width=141.733><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">7,467,319</font></P>
</TD><TD valign=top width=122.867><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">1 for 1</font></P>
</TD><TD valign=top width=102.2><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">$0.550</font></P>
</TD><TD valign=top width=134><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">September 29, 2005</font></P>
</TD></TR>
<TR><TD valign=top width=141.733><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">19,765,590</font></P>
</TD><TD valign=top width=122.867><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">1 for 1</font></P>
</TD><TD valign=top width=102.2><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">$0.550</font></P>
</TD><TD valign=top width=134><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">October 26, 2005</font></P>
</TD></TR>
</TABLE>
  </center>
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<font face="Arial">
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<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
</font>
<P style="margin:0pt; padding-left:27pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Notes to the Consolidated Financial Statements</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(in thousands of Canadian Dollars unless otherwise indicated and except for share and per share amounts)</font> </P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">4.</font> </B></P>
<P style="margin:0pt; text-indent:56.7pt; font-family:Shruti" align="left"><font face="Arial"><B>Share Capital </B>(continued)</font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:56.7pt; font-family:Shruti" align="left"><font face="Arial">The continuity of warrants issued and outstanding is as follows:</font></P>
<P style="margin:0pt; text-indent:37.1pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR><TD valign=top width=226.8><font face="Arial">&nbsp;</font></TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti" align=center><U><font face="Arial">Number of Warrants</font></U></P>
</TD></TR>
<TR><TD valign=top width=226.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">Outstanding December 31, 2001</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">17,000,000</font></P>
</TD></TR>
<TR><TD valign=top width=226.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">Issued pursuant to private placements</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">13,704,828</font></P>
</TD></TR>
<TR><TD valign=top width=226.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">Issued to Broker</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">2,396,163</font></P>
</TD></TR>
<TR><TD valign=top width=226.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">Issued for conversion of debt</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">291,375</font></P>
</TD></TR>
<TR><TD valign=top width=226.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">Exercised</font></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=132.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(18,018,000)</font></P>
</TD></TR>
<TR><TD valign=top width=226.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">Outstanding December 31, 2002</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">15,374,366</font></P>
</TD></TR>
<TR><TD valign=top width=226.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">Issued pursuant to private placements</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">12,640,000</font></P>
</TD></TR>
<TR><TD valign=top width=226.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">Issued to Broker</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">2,528,000</font></P>
</TD></TR>
<TR><TD valign=top width=226.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">Exercised</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(15,093,252)</font></P>
</TD></TR>
<TR><TD valign=top width=226.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">Outstanding December 31, 2003</font></P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=132.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">15,449,114</font></P>
</TD></TR>
<TR><TD valign=top width=226.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">Issued pursuant to private placements</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">22,694,091</font></P>
</TD></TR>
<TR><TD valign=top width=226.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">Issued to Broker</font></P>
</TD><TD valign=top width=132.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">4,538,818</font></P>
</TD></TR>
<TR><TD valign=top width=226.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">Exercised</font></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=132.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(3,449,114)</font></P>
</TD></TR>
<TR><TD valign=top width=226.8><P style="margin:0pt; font-family:Shruti"><font face="Arial">Outstanding December 31, 2004</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=132.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">39,232,909</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; line-height:1.35pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Courier; font-size:12pt; border-bottom:2.25pt solid #000000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:1.35pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">5.</font> </B></P>
<P style="margin:0pt; text-indent:56.7pt; font-family:Shruti" align="left"><B><font face="Arial">Income Taxes</font></B></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Shruti" align="left"><font face="Arial">The Company&#146;s effective tax rate, which differs from the combined federal and provincial statutory income tax rates, may be reconciled as follows:</font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; text-indent:262.25pt; line-height:14pt; font-family:Shruti; font-size:9.5pt"><B><font face="Arial">2004</font></B></P>
<B><P style="margin-top:0pt; margin-bottom:-14pt; text-indent:347.3pt; line-height:14pt; font-family:Shruti; font-size:9.5pt"></B><font face="Arial">2003</font></P>
<P style="margin:0pt; text-indent:425.25pt; font-family:Shruti; font-size:9.5pt"><font face="Arial">2002</font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=252><font face="Arial">&nbsp;</font></TD><TD style="border-top:1pt solid #000000" valign=top width=60><font face="Arial">&nbsp;</font></TD><TD style="border-top:1pt solid #000000" valign=top width=60><font face="Arial">&nbsp;</font></TD><TD style="border-top:1pt solid #000000" valign=top width=60><font face="Arial">&nbsp;</font></TD><TD style="border-top:1pt solid #000000" valign=top width=49.2><font face="Arial">&nbsp;</font></TD><TD style="border-top:1pt solid #000000" valign=top width=58.8><font face="Arial">&nbsp;</font></TD><TD style="border-top:1pt solid #000000" valign=top width=60><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=252><font face="Arial">&nbsp;</font></TD><TD valign=top width=60 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><B><U><font face="Arial">$</font></U></B></P>
</TD><TD valign=top width=60 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><B><U><font face="Arial">%</font></U></B></P>
</TD><TD valign=top width=60 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><U><font face="Arial">$</font></U></P>
</TD><TD valign=top width=49.2 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><U><font face="Arial">%</font></U></P>
</TD><TD valign=top width=58.8 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><U><font face="Arial">$</font></U></P>
</TD><TD valign=top width=60 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><U><font face="Arial">%</font></U></P>
</TD></TR>
<TR><TD valign=top width=252><P style="margin:0pt; padding-left:-6pt; font-family:Shruti; font-size:9.5pt"><font face="Arial">Basic rate applied to pre-tax income (loss)</font></P>
</TD><TD valign=top width=60 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><B><font face="Arial">(3,609)</font></B></P>
</TD><TD valign=top width=60 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><B><font face="Arial">(36.12)</font></B></P>
</TD><TD valign=top width=60 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">(5,319)</font></P>
</TD><TD valign=top width=49.2 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt"><font face="Arial">(36.6)</font></P>
</TD><TD valign=top width=58.8 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">(1,721)</font></P>
</TD><TD valign=top width=60 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">(38.6)</font></P>
</TD></TR>
<TR><TD valign=top width=252><P style="margin:0pt; text-indent:-6pt; font-family:Shruti; font-size:9.5pt"><font face="Arial">Losses and other benefits not recognized</font></P>
</TD><TD valign=top width=60 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><B><font face="Arial">3,609</font></B></P>
</TD><TD valign=top width=60 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><B><font face="Arial">36.12</font></B></P>
</TD><TD valign=top width=60 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">5,319</font></P>
</TD><TD valign=top width=49.2 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;36.6</font></P>
</TD><TD valign=top width=58.8 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">1,721</font></P>
</TD><TD valign=top width=60 align="right"><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=right><font face="Arial">38.6</font></P>
</TD></TR>
<TR><TD valign=top width=252><font face="Arial">&nbsp;</font></TD><TD style="border-top:0.5pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=60><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=center><B><font face="Arial">-</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=60><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=center><B><font face="Arial">-</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=60><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=49.2><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=58.8><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=60><P style="margin:0pt; font-family:Shruti; font-size:9.5pt" align=center><font face="Arial">-</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Shruti" align="left"><font face="Arial">The Company and its subsidiaries have non-capital losses of approximately $35,123 which may be carried forward to reduce future taxable income. &nbsp;The right to claim non-capital losses of $1,584, $18,984, $3,611, $142, $611, and $10,191 expires in 2011, 2010, 2009, 2008, 2007 and 2005 respectively. &nbsp;The Company also has approximately $70,713 in capital losses which can be applied to reduce future capital gains. &nbsp;The right to claim these capital losses is carried forward indefinitely but can only be claimed against capital gains. &nbsp;</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Notes to the Consolidated Financial Statements</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(in thousands of Canadian Dollars unless otherwise indicated and except for share and per share amounts)</font> </P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">5.</font> </B></P>
<P style="margin:0pt; text-indent:27pt; font-family:Shruti" align="left"><B><font face="Arial">Income Taxes (continued)</font></B></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:27pt; font-family:Shruti" align="left"><font face="Arial">The Company also has the following expenses which are available to be applied against future income for income tax purposes:</font></P>
<P style="margin:0pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR><TD valign=top width=292.933><P style="margin:0pt; font-family:Shruti"><font face="Arial">Canadian exploration and development expenses</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$7,560</font></P>
</TD></TR>
<TR><TD valign=top width=292.933><P style="margin:0pt; font-family:Shruti"><font face="Arial">Foreign exploration and development expenses</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=94.533><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$1,812</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">A valuation allowance had been recorded to offset the benefit of these non-capital losses and expenses in these consolidated financial statements as the realization thereof is not considered likely.</font></P>
<P style="margin:0pt; line-height:1.35pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Courier; font-size:12pt; border-bottom:2.25pt solid #000000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:28.35pt; font-family:Courier; font-size:8pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">6.</font></B></P>
<P style="margin-top:0pt; margin-bottom:-14pt; text-indent:28.35pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">Net (Loss) Per Share</font></B></P>
<P style="margin:0pt; text-indent:145.1pt; font-family:Shruti" align="left"><B><font face="Arial"><BR></font></B></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:27pt; font-family:Shruti" align="left"><font face="Arial">The net (loss) per share figures have been calculated using the weighted average number of common shares outstanding during the respective fiscal years which amounted to 289,843,080 (2003 &#150; 232,280,330; &nbsp;2002 &#150; 190,296,440). &nbsp;Under the treasury method of calculating fully diluted income per share, exercise of the outstanding stock options and warrants would be anti-dilutive in 2004, 2003 and 2002. &nbsp;</font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-bottom:3pt; line-height:1.35pt; font-family:Shruti; border-bottom:2.25pt solid #000000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">7.</font></B></P>
<P style="margin:0pt; text-indent:28.35pt; font-family:Shruti" align="left"><B><font face="Arial">Other Expense (Income)</font> </B></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:28.35pt; text-indent:28.35pt; font-family:Shruti" align="left"><font face="Arial">Other expense (income) is comprised of the following:</font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=263>
      <p align="left"><font face="Arial">&nbsp;</font></p>
    </TD><TD valign=top width=94.6><P style="margin:0pt; font-family:Shruti" align=right><B><U><font face="Arial">2004</font></U></B></P>
</TD><TD valign=top width=94.4><P style="margin:0pt; font-family:Shruti" align=right><U><font face="Arial">2003</font></U></P>
</TD><TD valign=top width=96.4><P style="margin:0pt; font-family:Shruti" align=right><U><font face="Arial">2002</font></U></P>
</TD></TR>
<TR><TD valign=top width=263><font face="Arial">&nbsp;</font></TD><TD valign=top width=94.6><font face="Arial">&nbsp;</font></TD><TD valign=top width=94.4><font face="Arial">&nbsp;</font></TD><TD valign=top width=96.4><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=263><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti"><font face="Arial">Investment income</font></P>
</TD><TD valign=top width=94.6><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">($152)</font></B></P>
</TD><TD valign=top width=94.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">($51)</font></P>
</TD><TD valign=top width=96.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">($7)</font></P>
</TD></TR>
<TR><TD valign=top width=263><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti"><font face="Arial">Oil and gas net income</font></P>
</TD><TD valign=top width=94.6><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=94.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=96.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(7)</font></P>
</TD></TR>
<TR><TD valign=top width=263><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti"><font face="Arial">Foreign exchange (gain) loss</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=94.6><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">513</font></B></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=94.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">1</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=96.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">180</font></P>
</TD></TR>
<TR><TD valign=top width=263><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=94.6><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$361</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=94.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">($50)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96.4><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$166</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-bottom:3pt; line-height:1.35pt; font-family:Courier; font-size:12pt; border-bottom:2.25pt solid #000000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:56.7pt; text-indent:-35.4pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">8.</font></B></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align="left"><B><font face="Arial">Statement of Cash Flow</font></B></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:28.35pt; text-indent:28.35pt; font-family:Shruti" align="left"><font face="Arial">Items not involving cash are as follows:</font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=293><font face="Arial">&nbsp;</font></TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti" align=right><B><U><font face="Arial">2004</font></U></B></P>
</TD><TD valign=top width=93.267><P style="margin:0pt; font-family:Shruti" align=right><U><font face="Arial">2003</font></U></P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; font-family:Shruti" align=right><U><font face="Arial">2002</font></U></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; font-family:Shruti"><font face="Arial">Amortization</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$800</font></B></P>
</TD><TD valign=top width=93.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$438</font></P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$16</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; font-family:Shruti"><font face="Arial">Write down of mineral properties and capital losses</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">1,062</font></B></P>
</TD><TD valign=top width=94.467 colspan=2><P style="margin:0pt; text-indent:15.15pt; font-family:Shruti" align=right><font face="Arial">9,759</font></P>
</TD><TD valign=top width=94.8><P style="margin:0pt; text-indent:14.95pt; font-family:Shruti" align=right><font face="Arial">2,590</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; font-family:Shruti"><font face="Arial">Provision for site restoration</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">70</font></B></P>
</TD><TD valign=top width=93.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">54</font></P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(203)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; font-family:Shruti"><font face="Arial">Non-controlling interest</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti" align="right"><B><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(13)</font></B></P>
</TD><TD valign=top width=93.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(38)</font></P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(13)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; font-family:Shruti"><font face="Arial">Option grant expensed</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">195</font></B></P>
</TD><TD valign=top width=93.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">76</font></P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">209</font></P>
</TD></TR>
<TR><TD valign=top width=293><font face="Arial">&nbsp;</font></TD><TD style="border-top:1pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$2,114</font></B></P>
</TD><TD style="border-top:1pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=93.267><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$10,289</font></P>
</TD><TD style="border-top:1pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=96 colspan=2><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$2,599</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
</font>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Notes to the Consolidated Financial Statements</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(in thousands of Canadian Dollars unless otherwise indicated and except for share and per share amounts)</font> </P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">8.</font></B></P>
<P style="margin:0pt; text-indent:37.1pt; font-family:Shruti" align="left"><B><font face="Arial">Statement of Cash Flow (continued)</font></B></P>
<P style="margin:0pt; text-indent:56.7pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:56.7pt; font-family:Shruti" align="left"><font face="Arial">The net changes in non-cash working capital balances for continuing operations are as follows:</font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=263><font face="Arial">&nbsp;</font></TD><TD valign=top width=94.6><P style="margin:0pt; font-family:Shruti" align=right><B><U><font face="Arial">2004</font></U></B></P>
</TD><TD valign=top width=94.8><P style="margin:0pt; font-family:Shruti" align=right><U><font face="Arial">2003</font></U></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><U><font face="Arial">2002</font></U></P>
</TD></TR>
<TR><TD valign=top width=263><P style="margin:0pt; font-family:Shruti"><font face="Arial">Accounts payable</font></P>
</TD><TD valign=top width=94.6><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$272</font></B></P>
</TD><TD valign=top width=94.8><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">($477)</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">($337)</font></P>
</TD></TR>
<TR><TD valign=top width=263><P style="margin:0pt; font-family:Shruti"><font face="Arial">Accounts receivable</font></P>
</TD><TD valign=top width=94.6><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">(138)</font></B></P>
</TD><TD valign=top width=94.8><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(65)</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(24)</font></P>
</TD></TR>
<TR><TD valign=top width=263><P style="margin:0pt; font-family:Shruti"><font face="Arial">Inventories</font></P>
</TD><TD valign=top width=94.6><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">(422)</font></B></P>
</TD><TD valign=top width=94.8><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(86)</font></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">-</font></P>
</TD></TR>
<TR><TD valign=top width=263><P style="margin:0pt; font-family:Shruti"><font face="Arial">Prepaid expenses</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=94.6><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">(57)</font></B></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=94.8><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(13)</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(112)</font></P>
</TD></TR>
<TR><TD valign=top width=263><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=94.6><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$(345)</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=94.8><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">($641)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=96><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">($473)</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:56.7pt; font-family:Shruti" align="left"><font face="Arial">Additional cash flow information:</font></P>
<P style="margin:0pt; text-indent:56.7pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:56.7pt; font-family:Shruti" align="left"><font face="Arial">In 2002, the Company issued 4,163,529 shares to settle loans payable of $640.</font></P>
<P style="margin:0pt; text-indent:56.7pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-bottom:3pt; line-height:1.35pt; font-family:Courier; font-size:12pt; border-bottom:2.25pt solid #000000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align=left><B><font face="Arial">9.</font></B></P>
<P style="margin:0pt; text-indent:28.35pt; font-family:Shruti" align=left><B><font face="Arial">Financial Instruments</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial">Unless otherwise noted, it is the opinion of management that the Company is not exposed to significant interest rate or credit risks arising from its financial instruments. &nbsp;A significant portion of the Company&#146;s assets and liabilities are denominated in South African rand. &nbsp;Fluctuations in the value of the rand relative to the Canadian dollar could have a significant impact on the results of operations. &nbsp;The fair values of these financial instruments approximate their carrying values, unless otherwise noted. &nbsp;The Company does not use any derivative instruments to reduce its foreign currency risks.</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-bottom:3pt; line-height:1.35pt; font-family:Courier; font-size:12pt; border-bottom:2.25pt solid #000000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:1.1pt; text-indent:-1.1pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">10.</font></B></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:1.1pt; text-indent:25.9pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">Related Party Transactions</font></B></P>
<P style="margin:0pt; padding-left:1.1pt; text-indent:252pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:20.2pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:28.35pt; text-indent:-1.35pt; font-family:Shruti" align="left"><font face="Arial">The Company had the following related party transactions: &nbsp;&nbsp;&nbsp;</font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=468><font face="Arial">&nbsp;</font></TD><TD style="border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=center><B><U><font face="Arial">2004</font></U></B></P>
</TD><TD style="border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=center><U><font face="Arial">2003</font></U></P>
</TD><TD style="border-top:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=center><U><font face="Arial">2002</font></U></P>
</TD></TR>
<TR><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=468><P style="margin:0pt; font-family:Shruti"><font face="Arial">Management and administrative services paid or accrued to a company which employs the Company&#146;s President</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">$225</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$180</font></P>
</TD><TD style="border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">$180</font></P>
</TD></TR>
<TR><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=468><P style="margin:0pt; font-family:Shruti"><font face="Arial">Interest paid to the Corporation&#146;s President<SUP>(1)</SUP></font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">127</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">-</font></P>
</TD><TD style="border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">-</font></P>
</TD></TR>
<TR><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=468><P style="margin:0pt; font-family:Shruti"><font face="Arial">Rent paid to a company owned by members of the President&#146;s family</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">83</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">78</font></P>
</TD><TD style="border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">63</font></P>
</TD></TR>
<TR><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=468><P style="margin:0pt; font-family:Shruti"><font face="Arial">Interest paid to a company owned by members of the President&#146;s family<SUP>(2)</SUP></font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">23</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">-</font></P>
</TD><TD style="border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">-</font></P>
</TD></TR>
<TR><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=468><P style="margin:0pt; font-family:Shruti"><font face="Arial">Sale of a motor vehicle to the President at a market-related price</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">114</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=48><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #000000" valign=top width=48><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=468><P style="margin:0pt; font-family:Shruti"><font face="Arial">Purchase of a motor vehicle from the President at a market-related price</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=48><P style="margin:0pt; font-family:Shruti" align=right><B><font face="Arial">16</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=48><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #000000" valign=top width=48><font face="Arial">&nbsp;</font></TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:27pt; text-indent:-18pt; font-family:Shruti" align=left><font face="Arial">(1) &nbsp;In prior years the President delayed submitting regular expense claims due to the Corporation&#146;s cash situation. During 2004 all outstanding claims were submitted and the amount due, including interest at market-related rates, was paid to him.</font></P>
<P style="margin:0pt; padding-left:27pt; text-indent:-18pt; font-family:Courier; font-size:12pt" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:27pt; text-indent:-18pt; font-family:Shruti" align=left><font face="Arial">(2) &nbsp;In prior years office rental payable to a company owned by members of the President&#146;s family was not &nbsp;&nbsp;&nbsp;always paid. &nbsp;During 2004 all outstanding amounts were paid, including interest at market-related rates.</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Notes to the Consolidated Financial Statements</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(in thousands of Canadian Dollars unless otherwise indicated and except for share and per share amounts)</font> </P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; text-indent:21.55pt; font-family:Courier; font-size:8pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:1.1pt; text-indent:-1.1pt; line-height:14pt; font-family:Shruti; font-size:9pt" align="left"><B><font face="Arial">10.</font></B></P>
<P style="margin:0pt; padding-left:1.1pt; text-indent:25.9pt; font-family:Shruti; font-size:9pt" align="left"><B><font face="Arial">Related Party Transactions (continued)</font></B></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti; font-size:9pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti; font-size:9pt" align="left"><font face="Arial">These related party transactions were in the normal course of operations and are recorded at the exchange amount. &nbsp;The Company has the following related party balances:</font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border-left:0.5pt solid #000000; border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=406.4><font face="Arial">&nbsp;</font></TD><TD style="border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=47.2><P style="margin:0pt; font-family:Shruti; font-size:9pt"><B><U><font face="Arial">2004</font></U></B></P>
</TD><TD style="border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=47.267><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><U><font face="Arial">2003</font></U></P>
</TD><TD style="border-top:0.75pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=47.533><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><U><font face="Arial">2002</font></U></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=406.4><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">Included in accounts payable</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=47.2><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=47.267><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=47.533><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=406.4><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">- owing to a company that employs the Company&#146;s President</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=47.2><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">$ &nbsp;&nbsp;-</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=47.267><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">&nbsp;&nbsp;$55</font></B></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=47.533><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$296</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=406.4><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">- owing to the Corporation&#146;s President</font></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=47.2><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">3</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=47.267><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=47.533><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=406.4><P style="margin:0pt; font-family:Shruti; font-size:9pt"><font face="Arial">- owing to directors/officers for unpaid salaries</font> </P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=47.2><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD style="border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=47.267><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">&nbsp;&nbsp;112</font></B></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.75pt solid #000000" valign=top width=47.533><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">&nbsp;&nbsp;556</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; padding-bottom:3pt; font-family:Courier; font-size:8pt; border-bottom:2.25pt solid #000000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:21.55pt; font-family:Courier; font-size:8pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti; font-size:9pt" align="left"><B><font face="Arial">11.</font></B></P>
<P style="margin:0pt; text-indent:28.35pt; font-family:Shruti; font-size:9pt" align="left"><B><font face="Arial">Segmented Financial Information</font></B></P>
<P style="margin:0pt; text-indent:21.55pt; font-family:Shruti; font-size:9pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti; font-size:9pt" align="left"><font face="Arial">The Company has been engaged directly or through subsidiaries in the production of and the exploration for precious metals in various geographical locations.</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti; font-size:9pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti; font-size:9pt" align="left"><font face="Arial">The Company&#146;s operating segments have been identified based on geographic areas as follows:</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=293></TD><TD valign=top width=273 colspan="4">
      <p align="center"><font face="Arial">For the year ended December 31, 2004</font>
</TD></TR>
  <TR><TD valign=top width=293><font face="Arial">&nbsp;</font></TD><TD style="border-top:1.5pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><B><U><font face="Arial">Corporate</font></U></B></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><B><U><font face="Arial">South Africa</font></U></B></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><B><U><font face="Arial">Zambia</font></U></B></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><B><U><font face="Arial">Total</font></U></B></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Revenue from sales</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">$ &nbsp;&nbsp;&nbsp;-</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">$841</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">$ &nbsp;&nbsp;-</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">$841</font></B></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Operating costs</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(6,451)</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(6,451)</font></B></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">General and administrative</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1,676)</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(308)</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(1,984)</font></B></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Interest</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(175)</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(175)</font></B></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Amortization</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(800)</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(800)</font></B></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Other income (expense)</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">5</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(366)</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(361)</font></B></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Write down of mineral properties</font></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(1,062)</font></B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(1,062)</font></B></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">(Loss) before the undernoted</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;(1,671)</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(8,321)</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(9,992)</font></B></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Non-controlling interest</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">13</font></B></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">13</font></B></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Net income (loss) for the year</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(1,671)</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(8,308)</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">(9,979)</font></B></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Identifiable assets</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">7,181</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">15,395</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">1,090</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">23,666</font></B></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Expenditures on capital assets &amp; mineral properties</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">$ &nbsp;&nbsp;-</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">$3,813</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">$0</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><B><font face="Arial">$3,813</font></B></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; text-indent:289.1pt; font-family:Shruti; font-size:9pt" align="left"><font face="Arial">&nbsp;</font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=293></TD><TD valign=top width=273 colspan="4">
      <p align="center"><font face="Arial">For the year ended December 31, 2003</font>
</TD></TR>
  <TR><TD valign=top width=293><font face="Arial">&nbsp;</font></TD><TD style="border-top:1.5pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><U><font face="Arial">Corporate</font></U></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><U><font face="Arial">South Africa</font></U></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><U><font face="Arial">Zambia</font></U></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><U><font face="Arial">Total</font></U></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Revenue from sales</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$ &nbsp;&nbsp;-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$646</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$ &nbsp;&nbsp;-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$646</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Operating costs</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(3,630)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(3,630)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">General and administrative</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(1,276)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(1,276)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Interest</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(127)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(127)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Amortization</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(438)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(438)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Other income (expense)</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(26)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">76</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">50</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Write down of mineral properties</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(225)</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(9,534)</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(9,759)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">(Loss) before the undernoted</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(1,302)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(3,698)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(9,534)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(14,534)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Non-controlling interest</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">38</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">38</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Net income (loss) for the year</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(1,302)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(3,660)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(9,534)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(14,496)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Identifiable assets</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">5,000</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">13,486</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">1,044</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">19,530</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Expenditures on capital assets &amp; mineral properties</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$ &nbsp;&nbsp;-</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$2,140</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$139</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$2,279</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt">&nbsp;</P>
<P style="margin:0pt; font-family:Courier; font-size:12pt">&nbsp;</P>
<P style="margin:0pt; font-family:Courier; font-size:12pt">&nbsp;</P>
<P style="margin:0pt; padding-left:21.3pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; padding-left:21.3pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Notes to the Consolidated Financial Statements</font></B></P>
<P style="margin:0pt; padding-left:21.3pt; font-family:Shruti" align=right><font face="Arial">(in thousands of Canadian Dollars unless otherwise indicated and except for share and per share amounts)</font> </P>
<P style="margin:0pt; padding-left:21.3pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; padding-left:21.3pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">12.</font></B></P>
<P style="margin:0pt; text-indent:28.35pt; font-family:Shruti" align="left"><font face="Arial"><B>Segmented Financial Information</B> (continued)</font></P>
<P style="margin:0pt; padding-left:28.35pt; font-family:Shruti" align=center><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For the year ended December 31, 2002</font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=293><font face="Arial">&nbsp;</font></TD><TD style="border-top:1.5pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">Corporate</font></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">South Africa</font></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">Zambia</font></P>
</TD><TD style="border-top:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=center><font face="Arial">Total</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Revenue from sales</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$ &nbsp;&nbsp;-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$27</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$ &nbsp;&nbsp;-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$27</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Operating costs</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(145)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(145)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">General and administrative</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(1,405)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(135)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(1,540)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Interest</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(29)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(29)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Amortization</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(9)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(7)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(16)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Write down of mineral properties</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(2,590)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(2,590)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Other income (expense)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(23)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(143)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(166)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">(Loss) before the undernoted</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(1,466)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(403)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(2,590)</font></P>
</TD><TD valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(4,459)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Non-controlling interest</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">13</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">-</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">13</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Net (loss) for the year</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(1,466)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(390)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(2,590)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">(4,446)</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Identifiable assets</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">2,614</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">11,946</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">10,410</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">24,969</font></P>
</TD></TR>
<TR><TD valign=top width=293><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:9pt"><font face="Arial">Expenditures on capital assets &amp; mineral properties</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$ &nbsp;-</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$504</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$119</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=66.133><P style="margin:0pt; font-family:Shruti; font-size:9pt" align=right><font face="Arial">$613</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; line-height:1.35pt; font-family:Shruti"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:21.3pt; padding-bottom:3pt; text-indent:0.3pt; font-family:Courier; font-size:9pt; border-bottom:2.25pt solid #000000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:21.3pt; text-indent:0.3pt; font-family:Courier; font-size:9pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">13.</font></B></P>
<P style="margin:0pt; text-indent:27pt; font-family:Shruti" align="left"><B><font face="Arial">Acquisition of the Minority Interest of Eersteling Gold Mining Company Limited</font></B></P>
<P style="margin:0pt; text-indent:28.35pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align="left"><font face="Arial">On the 14<SUP>th</SUP> June 2004 Eersteling Gold Mining Company Limited, a subsidiary of the Corporation acquired the remaining 3.6% minority shareholdings from the shareholders for a cash consideration of $26. &nbsp;The transaction has been accounted for as a step-by-step acquisition by the Corporation, resulting in negative goodwill of approximately $746 which has been allocated on a pro-rata basis as a reduction of the non-monetary assets of the subsidiary.</font></P>
<P style="margin:0pt; padding-left:21.3pt; padding-bottom:3pt; text-indent:0.3pt; font-family:Courier; font-size:9pt; border-bottom:2.25pt solid #000000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:21.3pt; text-indent:0.3pt; font-family:Shruti; font-size:9pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">14.</font></B></P>
<P style="margin:0pt; text-indent:27pt; font-family:Shruti" align="left"><B><font face="Arial">Subsequent Event</font></B></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align="left"><font face="Arial">On January 31, 2005 the company issued 2,000,000 stock options to the new non-executive Chairman of the Board of Directors.</font></P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Courier; font-size:9pt; border-bottom:2.25pt solid #000000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:21.3pt; text-indent:0.3pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">15. &nbsp;</font></B></P>
<P style="margin:0pt; text-indent:28.35pt; font-family:Shruti" align="left"><B><font face="Arial">Generally Accepted Accounting Principles in Canada and the United States</font></B> </P>
<P style="margin:0pt; padding-left:27pt; font-family:Shruti" align="left"><font face="Arial">The Company&#146;s accounting policies do not differ materially from accounting principles generally accepted in the United States (&quot;US GAAP&quot;) except for the following:</font></P>
<P style="margin:0pt; padding-left:28.35pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:27pt; line-height:14pt; font-family:Shruti" align="left"><font face="Arial">(a)</font></P>
<P style="margin:0pt; padding-left:27pt; text-indent:27pt; font-family:Shruti" align="left"><font face="Arial">Mineral Properties</font></P>
<P style="margin:0pt; padding-left:54pt; font-family:Shruti" align="left"><font face="Arial">US GAAP requires that mineral properties with no proven reserves be reflected as expenses in the period incurred.</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:35.45pt; text-indent:-8.45pt; line-height:14pt; font-family:Shruti" align="left"><font face="Arial">(b)</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:18.55pt; font-family:Shruti" align="left"><font face="Arial">Other Paid in Capital</font></P>
<P style="margin:0pt; padding-left:54pt; font-family:Shruti" align=left><font face="Arial">Under Canadian GAAP, convertible debentures have been segregated into a debt and equity component. &nbsp;The resulting debt discount is amortized over the term of the debt and is included with interest expense. &nbsp;Under US GAAP, the convertible debentures would be shown as debt only and therefore would not include an equity component or amortization expense.</font></P>
<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Notes to the Consolidated Financial Statements</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(in thousands of Canadian Dollars unless otherwise indicated and except for share and per share amounts)</font> </P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">15.</font></B></P>
<P style="margin:0pt; text-indent:28.35pt; font-family:Shruti" align="left"><font face="Arial"><B>Generally Accepted Accounting Principles in Canada and the United States</B> (continued)</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:35.45pt; line-height:14pt; font-family:Shruti" align=left><font face="Arial">(c)</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:21.25pt; font-family:Shruti" align=left><font face="Arial">Employee and Directors Stock Options</font></P>
<P style="margin:0pt; padding-left:56.7pt; text-indent:-1.1pt; font-family:Shruti" align=left><font face="Arial">Prior to 2003, the Company accounted for employee and director stock options under APB Opinion No. &nbsp;25 under which no compensation cost is recognized when the exercise price equals or exceeds the fair</font> </P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial">value at the date of grant. Effective 1 January 2003, the company has for US reporting purposes prospectively applied the fair-value recognition provisions of SFAS 123.</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial">Under Canadian GAAP, effective January 1, 2002 on a prospective basis, the Company adopted the new CICA policy of accounting for stock based compensation. Compensation expense on stock options granted to directors, officers and employees, was not recorded. However, disclosure of the effects of accounting for the compensation expense, utilizing the fair value method estimated using the Black-Scholes Option Pricing Model, was disclosed as pro-forma information. For 2002, a compensation expense was shown reflecting the intrinsic value attributable to stock options granted to directors, officers and employees.</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial">Under Canadian GAAP, effective January 1, 2003 on a prospective basis, the Company commenced the expensing of all stock based compensation for new stock option grants applying the fair value method estimated by using the Black-Scholes Option Pricing Model.</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:35.45pt; line-height:14pt; font-family:Shruti" align=left><font face="Arial">(d)</font></P>
<P style="margin:0pt; padding-left:35.45pt; text-indent:21.25pt; font-family:Shruti" align=left><font face="Arial">Comprehensive Income</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial">Under US GAAP, comprehensive income must be reported which is defined as all changes in equity other than those resulting from investments by owners and distributions to owners.</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Shruti" align=left><font face="Arial">(e) &nbsp;&nbsp;&nbsp;Net Gain on Conversion of the Convertible Debentures and Settlement of Debt</font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial">For US GAAP purposes a loss is recognized on settlement of debt to the extent that the quoted market value of shares and fair value of warrants issued at the date of settlement exceeds the carrying amount of debt.</font> </P>
<P style="margin:0pt; padding-left:28.35pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:53.85pt; text-indent:-25.5pt; line-height:14pt; font-family:Shruti" align=left><font face="Arial">(f)</font></P>
<P style="margin:0pt; padding-left:53.85pt; font-family:Shruti" align=left><font face="Arial">Asset Retirement Obligations</font></P>
<P style="margin:0pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial">In 2004, the Company adopted the Canadian GAAP &nbsp;standards of &#147;Asset Retirement Obligations&#148; which are consistent with SFAS No. 143, &#147;Accounting for Asset Retirement Obligations&#148;. &nbsp;These standards address financial accounting and reporting for obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. &nbsp;These standards require that the fair value of a liability for an asset retirement obligation be recognized in the period in which it is incurred if a reasonable estimate of fair value can be made. &nbsp;The associated asset retirement costs are capitalized as part of the carrying value of the long-lived asset. &nbsp;For Canadian accounting purposes, the Company adopted this standard during 2004 with retroactive restatement to 2002. &nbsp;Under US GAAP the cumulative effect of the change in accounting principles is shown, with no
 retroactive restatement of the comparative figures.</font> </P>
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<P style="margin:0pt; padding-top:3pt; font-family:Shruti; font-size:12pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt" align=right><B><font face="Arial">Notes to the Consolidated Financial Statements</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(in thousands of Canadian Dollars unless otherwise indicated and except for share and per share amounts)</font> </P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">15.</font></B></P>
<P style="margin:0pt; text-indent:28.35pt; font-family:Shruti" align="left"><font face="Arial"><B>Generally Accepted Accounting Principles in Canada and the United States</B> (continued)</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:56.7pt; text-indent:-28.35pt; line-height:14pt; font-family:Shruti" align="left"><font face="Arial">(g)</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align="left"><font face="Arial">Marketable Securities</font></P>
<P style="margin:0pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align="left"><font face="Arial">Under accounting principles generally accepted in Canada, gains (losses) in shares of public companies are not recognized until investments are sold unless there is deemed to be an impairment of value which is other than temporary. Under US GAAP, such investments are recorded at market value and the unrealised gain and losses are recognized in other comprehensive income unless there is deemed to be an impairment which is other than temporary.Under FAS 115 the Company is accounting for the marketable securities as available for sale.</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-9pt; text-indent:36pt; font-family:Shruti" align=left><font face="Arial">(h) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Recently Issued United States Accounting Standards</font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial">In January 2003, the FASB issued Financial Interpretation 46 &#147;Accounting for Variable Interest Entities&#148; (&#147;FIN 46&#148;) that will require the consolidation of certain entities that are controlled through financial interests that indicate control (referred to as &#147;variable interests&#148;), subsequently revised</font> </P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial">through the issuance of FIN 46R. &nbsp;Variable interests are the rights or obligations that convey economic gains or losses from changes in the values of the entity&#146;s assets or liabilities. &nbsp;The holder of the majority of an entity&#146;s variable interests will be required to consolidate the variable interest entity. &nbsp;FIN 46 applies to variable interest entities as of January 31, 2003, and to variable interest entities created after or in which an enterprise obtains an interest after that date. &nbsp;The Company does not have any arrangements with variable interest entities that will require consolidation of their financial information in the financial statements.</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial">In April 2003, the FASB issued SFAS 149, &#147;Amendment of Statement 133 on Derivative Instruments and Hedging Activities&#148;. &nbsp;SFAS 149 amends and clarifies financial accounting and reporting for derivative instruments, including certain derivative instruments embedded in other contracts and for hedging activities under SFAS 133 , &#147;Accounting for Derivative Instruments and Hedging Activities&#148;. &nbsp;</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial">The changes are intended to improve financial reporting by requiring that contracts with comparable characteristics be accounted for similarly. &nbsp;Additionally, those changes are expected to result in more consistent reporting of contracts as either derivatives or hybrid instruments. &nbsp;SFAS No. 149 is effective for contracts and hedging relationships entered into or modified after June 30, 2003, and for provisions that relate to SFAS No. 133 implementation issues that have been effective for fiscal quarters that began prior to &nbsp;June 15, 2003, apply &nbsp;in accordance &nbsp;with their respective effective dates. &nbsp;The &nbsp;adoption &nbsp;of &nbsp;this statement did not have a significant effect on the Company&#146;s consolidated financial position or results of operations.</font></P>
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<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Notes to the Consolidated Financial Statements</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(in thousands of Canadian Dollars unless otherwise indicated and except for share and per share amounts)</font> </P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">15.</font></B></P>
<P style="margin:0pt; text-indent:28.35pt; font-family:Shruti" align="left"><font face="Arial"><B>Generally Accepted Accounting Principles in Canada and the United States</B> (continued)</font></P>
<P style="margin:0pt; text-indent:21.55pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial">In May 2003, the FASB issued SFAS No. 150, &#147;Accounting for Certain Financial Instruments with Characteristics of both Liability and Equity&#148;. &nbsp;SFAS No. 150 establishes standards for how an issuer classifies and measures certain financial instruments with characteristics of both liability and equity. &nbsp;It also requires that an issuer classify a financial instrument that is within its scope as a liability (or an asset in some circumstances). &nbsp;Many of those instruments were previously classified as equity. &nbsp;SFAS No. 150 is effective for financial instruments entered into or modified after May 31, 2003, and otherwise is effective generally at the beginning of the first interim period beginning after June 15, 2003, except for mandatory redeemable financial instruments of non-public entities. &nbsp;It is to be implemented by reporting a cumulative effect of a change in an accounting principle fo
r financial instruments created before the issuance date of the Statement and still existing at the beginning of the interim period of adoption. &nbsp;Restatement is not permitted. &nbsp;The adoption of this statement did not have a material effect on the financial position of the Company or results of its operations.</font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:56.7pt; font-family:Shruti" align=left><font face="Arial">In December 2004, the Financial Accounting Standards Board (FASB) issued FASB Statement No. 123R (Revised), Share-Based Payment, which is a revision of FASB Statement No. 123, Accounting for Stock-Based Compensation. Statement No. 123(R) supersedes APB Opinion No. 25, Accounting for Stock Issued to Employees, and amends FASB Statement No. 95, Statement of Cash Flows. Statement No. 123(R). Statement No. 123(R) requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values and is effective at the beginning of the first interim or annual period beginning after June 15, 2005. The Company has determined that this will have no effect on the Company&#146;s consolidated financial position or results of operations.</font></P>
<P style="margin:0pt; padding-left:-9pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:28.35pt; text-indent:28.35pt; font-family:Shruti" align="left"><font face="Arial">The impact of the foregoing on the financial statements is as follows:</font></P>
<P style="margin:0pt; text-indent:21.55pt; font-family:Courier; font-size:8pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:21.55pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial" size="2"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; text-indent:28.35pt; line-height:14pt; font-family:Shruti; font-size:12pt" align="left"><font face="Arial" size="2">&nbsp;(a) Income Statement</font></P>
<P style="margin:0pt; text-indent:289.1pt; font-family:Shruti; font-size:8pt">&nbsp;</P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=370.2><font face="Arial">&nbsp;</font></TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=center><B><U><font face="Arial">2004</font></U></B></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=center><U><font face="Arial">2003</font></U></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=center><U><font face="Arial">2002</font></U></P>
</TD></TR>
<TR><TD valign=top width=370.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:8pt"><font face="Arial">Loss for the year per Canadian GAAP</font></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">($9,979)</font></B></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">($14,496)</font></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">$(4,446)</font></P>
</TD></TR>
<TR><TD valign=top width=370.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:8pt"><font face="Arial">Mineral property expenditure with no proven reserves (expensed) or previously expensed under US GAAP</font></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">(406)</font></B></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">9,081</font></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,303</font></P>
</TD></TR>
<TR><TD valign=top width=370.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:8pt"><font face="Arial">Asset retirement obligation</font></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">(60)</font></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">115</font></P>
</TD></TR>
<TR><TD valign=top width=370.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:8pt"><font face="Arial">Amortisation and closure accretion expense</font></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">(69)</font></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">-</font></P>
</TD></TR>
<TR><TD valign=top width=370.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:8pt"><font face="Arial">Compensation expense</font></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">(1,405)</font></P>
</TD></TR>
<TR><TD valign=top width=370.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:8pt"><font face="Arial">Loss on settlement of debt</font></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">(362)</font></P>
</TD></TR>
<TR><TD valign=top width=370.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:8pt"><font face="Arial">Income before cumulative effect adjustment</font></P>
</TD><TD style="border-top:1pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">($10,385)</font></B></P>
</TD><TD style="border-top:1pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">($5,544)</font></P>
</TD><TD style="border-top:1pt solid #000000; border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">($3,795)</font></P>
</TD></TR>
<TR><TD valign=top width=370.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:8pt"><font face="Arial">Cumulative effect adjustment</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">559</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">-</font></P>
</TD></TR>
<TR><TD valign=top width=370.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:8pt"><font face="Arial">Net income (loss) per US GAAP</font></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">($10,385)</font></B></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">($4,985)</font></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">($3,795)</font></P>
</TD></TR>
<TR><TD valign=top width=370.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:8pt"><font face="Arial">Other comprehensive loss</font></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">(36)</font></B></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">-</font></P>
</TD><TD valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">-</font></P>
</TD></TR>
<TR><TD valign=top width=370.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:8pt"><font face="Arial">Total comprehensive loss</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">($10,421)</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">($4,985)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">($3,795)</font></P>
</TD></TR>
<TR><TD valign=top width=370.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:8pt"><font face="Arial">(Loss) per share before cumulative effect adjustment</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">($0.036)</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">($0.024)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">($0.020)</font></P>
</TD></TR>
<TR><TD valign=top width=370.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:8pt"><font face="Arial">Cumulative effect adjustment per share</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">-</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">.002</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">-</font></P>
</TD></TR>
<TR><TD valign=top width=370.2><P style="margin:0pt; text-indent:1.1pt; font-family:Shruti; font-size:8pt"><font face="Arial">Basic and diluted (loss) per share</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">($0.036)</font></B></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">($0.022)</font></P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">($0.020)</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; text-indent:21.55pt; font-family:Courier; font-size:8pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
<BR>
</font>
<P style="margin:0pt; text-indent:21.55pt; font-family:Shruti; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:8pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-top:3pt; line-height:14pt; font-family:Shruti; font-size:14pt; border-top:1.5pt solid #000000" align=right><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Shruti; font-size:14pt" align=right><B><font face="Arial">Notes to the Consolidated Financial Statements</font></B></P>
<P style="margin:0pt; font-family:Shruti" align=right><font face="Arial">(in thousands of Canadian Dollars unless otherwise indicated and except for share and per share amounts)</font> </P>
<P style="margin:0pt; padding-bottom:3pt; font-family:Shruti; border-bottom:1pt solid #000000" align=right><B><font face="Arial">December 31, 2004, 2003 and 2002</font></B></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Shruti" align="left"><B><font face="Arial">15.</font></B></P>
<P style="margin:0pt; text-indent:28.35pt; font-family:Shruti" align="left"><font face="Arial"><B>Generally Accepted Accounting Principles in Canada and the United States</B> (continued)</font></P>
<P style="margin:0pt; text-indent:21.55pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-14pt; text-indent:28.35pt; line-height:14pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial">(b)</font> </P>
<P style="margin:0pt; text-indent:56.7pt; font-family:Shruti; font-size:8pt" align="left"><font face="Arial">Balance Sheet</font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=387.467>
      <p align="left"><font face="Arial">&nbsp;</font></p>
    </TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=center><B><U><font face="Arial">2004</font></U></B></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=center><U><font face="Arial">2003</font></U></P>
</TD></TR>
<TR><TD valign=top width=387.467><P style="margin:0pt; font-family:Shruti; font-size:8pt"><font face="Arial">Total assets per Canadian GAAP</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">$23,666</font></B></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">$19,530</font></P>
</TD></TR>
<TR><TD valign=top width=387.467><P style="margin:0pt; font-family:Shruti; font-size:8pt"><font face="Arial">Unrealised Loss on marketable securities</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">(36)</font></B></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">-</font></P>
</TD></TR>
<TR><TD valign=top width=387.467><P style="margin:0pt; font-family:Shruti; font-size:8pt"><font face="Arial">Mineral properties with no proven reserves expensed</font></P>
</TD><TD style="border-bottom:2.25pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">(2,653)</font></B></P>
</TD><TD style="border-bottom:2.25pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">(2,247)</font></P>
</TD></TR>
<TR><TD valign=top width=387.467><P style="margin:0pt; font-family:Shruti; font-size:8pt"><font face="Arial">Total assets per US GAAP</font></P>
</TD><TD style="border-bottom:2.25pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">$20,977</font></B></P>
</TD><TD style="border-bottom:2.25pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">$17,283</font></P>
</TD></TR>
<TR><TD valign=top width=387.467><font face="Arial">&nbsp;</font></TD><TD valign=top width=75.6><font face="Arial">&nbsp;</font></TD><TD valign=top width=75.6><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=387.467><P style="margin:0pt; font-family:Shruti; font-size:8pt"><font face="Arial">Total liabilities per Canadian and US GAAP</font></P>
</TD><TD style="border-bottom:2.25pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">$1,485</font></B></P>
</TD><TD style="border-bottom:2.25pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">$1,879</font></B></P>
</TD></TR>
<TR><TD valign=top width=387.467><font face="Arial">&nbsp;</font></TD><TD valign=top width=75.6><font face="Arial">&nbsp;</font></TD><TD valign=top width=75.6><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=387.467><P style="margin:0pt; font-family:Shruti; font-size:8pt"><font face="Arial">Shareholders&#146; equity</font></P>
</TD><TD valign=top width=75.6><font face="Arial">&nbsp;</font></TD><TD valign=top width=75.6><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=387.467><P style="margin:0pt; font-family:Shruti; font-size:8pt"><font face="Arial">Shareholders&#146; equity per Canadian GAAP</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">$22,181</font></B></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">$17,651</font></P>
</TD></TR>
<TR><TD valign=top width=387.467><P style="margin:0pt; font-family:Shruti; font-size:8pt"><font face="Arial">Mineral properties with no proven reserves expensed</font></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">(2,653)</font></B></P>
</TD><TD valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">(2,247)</font></P>
</TD></TR>
<TR><TD valign=top width=387.467><P style="margin:0pt; font-family:Shruti; font-size:8pt"><font face="Arial">Accumulated other comprehensive loss</font></P>
</TD><TD style="border-bottom:2.25pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">(36)</font></B></P>
</TD><TD style="border-bottom:2.25pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">-</font></P>
</TD></TR>
<TR><TD valign=top width=387.467><P style="margin:0pt; font-family:Shruti; font-size:8pt"><font face="Arial">Shareholders&#146; equity per US GAAP</font></P>
</TD><TD style="border-bottom:2.25pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><B><font face="Arial">$19,492</font></B></P>
</TD><TD style="border-bottom:2.25pt solid #000000" valign=top width=75.6><P style="margin:0pt; font-family:Shruti; font-size:8pt" align=right><font face="Arial">$15,404</font></P>
</TD></TR>
<TR><TD valign=top width=387.467><font face="Arial">&nbsp;</font></TD><TD valign=top width=75.6><font face="Arial">&nbsp;</font></TD><TD valign=top width=75.6><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD valign=top width=387.467><font face="Arial">&nbsp;</font></TD><TD valign=top width=75.6><font face="Arial">&nbsp;</font></TD><TD valign=top width=75.6><font face="Arial">&nbsp;</font></TD></TR>
</TABLE>
<font face="Arial">
<BR>
<BR>
</font>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
<BR>
</font>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="background-color:#000000; border:0.5pt solid #000000" valign=top width=638.4><P style="margin-top:4.65pt; margin-bottom:4.65pt; line-height:16pt; font-family:Shruti; font-size:14pt; color:#FFFFFF"><B><font face="Arial">Directors and Management</font></B></P>
</TD></TR>
</TABLE>
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<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><B><font face="Arial">BOARD OF DIRECTORS</font></B></P>
<P style="margin:0pt; text-indent:288pt; font-family:Shruti" align="left"><B><font face="Arial">OFFICERS</font></B> </P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><font face="Arial">G.R. Pardoe (2) (3) (4)</font></P>
<P style="margin:0pt; text-indent:288pt; font-family:Shruti" align="left"><font face="Arial">S. E. Hayden</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><I><font face="Arial">Chairman of the Board,</font></I></P>
<I><P style="margin:0pt; text-indent:288pt; font-family:Shruti" align="left"><font face="Arial">President and</font></I></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><I><font face="Arial">Johannesburg, South Africa</font></I></P>
<I><P style="margin:0pt; text-indent:288pt; font-family:Shruti" align="left"><font face="Arial">Chief Executive Officer</font></I></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><font face="Arial">S. E. Hayden &nbsp;(2) (3)</font> </P>
<P style="margin:0pt; text-indent:288pt; font-family:Shruti" align="left"><font face="Arial">F. C. Harvey &nbsp;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><I><font face="Arial">&nbsp;President and</font> </I></P>
<I><P style="margin:0pt; text-indent:288pt; font-family:Shruti" align="left"><font face="Arial">Technical Director, Secretary of</font> </I></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><I><font face="Arial">Chief Executive Officer</font></I></P>
<I><P style="margin-top:0pt; margin-bottom:-12pt; text-indent:288pt; font-family:Shruti" align="left"><font face="Arial">the Corporation</font></I></P>
<I><P style="margin:0pt; text-indent:468pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></I></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><I><font face="Arial">Johannesburg, South Africa</font></I></P>
<I><P style="margin:0pt; text-indent:279pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></I></P>
<P style="margin:0pt; text-indent:288pt; font-family:Shruti" align="left">&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><font face="Arial">J. Johnstone</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:288pt; font-family:Shruti" align="left"><font face="Arial">J. Johnstone</font></P>
<P style="margin:0pt; text-indent:468pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><I><font face="Arial">Vice President Operations and</font></I></P>
<I><P style="margin-top:0pt; margin-bottom:-12pt; text-indent:279pt; font-family:Shruti" align="left"><font face="Arial">&nbsp;&nbsp;&nbsp;Vice President Operations and</font></I></P>
<P style="margin:0pt; text-indent:432pt; font-family:Shruti" align="left"><I><font face="Arial"><BR></font></I></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><I><font face="Arial">Chief Operating Officer</font></I></P>
<I><P style="margin-top:0pt; margin-bottom:-12pt; text-indent:252pt; font-family:Shruti" align="left"><font face="Arial">&nbsp;&nbsp;</font></I></P>
<P style="margin:0pt; text-indent:279pt; font-family:Shruti" align="left"><I><font face="Arial">&nbsp;&nbsp;&nbsp;Chief Operating Officer</font></I></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><I><font face="Arial">&nbsp;Mississauga, Ontario, Canada</font></I></P>
<I><P style="margin:0pt; text-indent:468pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></I></P>
<P style="margin:0pt; text-indent:288pt; font-family:Shruti" align="left"><I><font face="Arial">&nbsp;</font></I></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><font face="Arial">F C. Harvey</font> </P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:288pt; font-family:Shruti" align="left"><font face="Arial">M.D. Tombs</font></P>
<P style="margin:0pt; text-indent:432pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><I><font face="Arial">Technical Director,</font></I></P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:288pt; font-family:Shruti" align="left"><I><font face="Arial">Vice-President Finance</font></I></P>
<P style="margin:0pt; text-indent:432pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><I><font face="Arial">Secretary to Corporation</font></I></P>
<I><P style="margin:0pt; text-indent:252pt; font-family:Shruti" align="left"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
and Chief Financial Officer</font></I></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><I><font face="Arial">Mississauga, Ontario, Canada</font></I></P>
<I><P style="margin:0pt; text-indent:252pt; line-height:14pt; font-family:Shruti; font-size:12pt" align="left"><font face="Arial">&nbsp;</font></I></P>
<P style="margin:0pt; text-indent:288pt; font-family:Shruti; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><font face="Arial">W. I. L. Forrest (1) (2) (3)</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:279pt; font-family:Shruti" align="left"><font face="Arial">J. Smith</font></P>
<P style="margin:0pt; text-indent:432pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><I><font face="Arial">Business Executive</font></I> </P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:288pt; font-family:Shruti" align="left"><I><font face="Arial">Vice-President Exploration</font></I></P>
<P style="margin:0pt; text-indent:468pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Shruti" align="left"><I><font face="Arial">Nyon, Switzerland</font></I></P>
<I><P style="margin-top:0pt; margin-bottom:-12pt; text-indent:216pt; font-family:Shruti" align="left"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></I></P>
<I><P style="margin:0pt; text-indent:540pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></I></P>
<P style="margin:0pt; text-indent:288pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">C. R. Jonsson (1) (2) (3)</font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><I><font face="Arial">Principal of Tupper Jonsson</font></I></P>
<P style="margin:0pt; font-family:Shruti" align="left"><I><font face="Arial">&amp; Yeadon</font></I></P>
<P style="margin:0pt; font-family:Shruti" align="left"><I><font face="Arial">Barristers &amp; Solicitors</font></I></P>
<P style="margin:0pt; font-family:Shruti" align="left"><I><font face="Arial">Vancouver, British Columbia,</font></I></P>
<P style="margin:0pt; font-family:Shruti" align="left"><I><font face="Arial">Canada</font></I></P>
<P style="margin:0pt; font-family:Shruti" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align=left><font face="Arial">R.G. Fasel (1) (4)</font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><I><font face="Arial">Business Executive</font></I></P>
<P style="margin:0pt; font-family:Shruti" align="left"><I><font face="Arial">Geneva, Switzerland</font></I></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><B><font face="Arial">BOARD COMMITTEE</font></B></P>
<P style="margin:0pt; font-family:Shruti" align="left"><B><font face="Arial">MEMBERS</font></B></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">(1) &nbsp;Audit Committee</font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">(2) &nbsp;Compensation Committee</font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">(3) &nbsp;Corporate Governance Committee</font></P>
<P style="margin:0pt; font-family:Shruti" align="left"><font face="Arial">(4) &nbsp;Nominating Committee</font></P>
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<P style="margin:0pt; padding-left:-42pt; padding-top:3pt; padding-right:3pt; padding-bottom:3pt; line-height:18pt; font-family:Times New Roman; font-size:16pt; border:18pt double #000000" align=center><B><font face="Arial">EXHIBIT #14b</font></B></P>
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<P style="margin:0pt; padding-left:-45pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">CALEDONIA MINING CORPORATION</font></B></P>
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<P style="margin:0pt; padding-left:-45pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">2005 MANAGEMENT PROXY CIRCULAR</font></B></P>
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<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">87</font></P>
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<P style="margin:0pt; padding-left:-45pt; line-height:27pt; font-family:Times New Roman; font-size:25pt" align=center><B><font face="Arial">Notice of Annual and</font></B></P>
<P style="margin:0pt; padding-left:-45pt; line-height:27pt; font-family:Times New Roman; font-size:25pt" align=center><font face="Arial">Special Meeting of Shareholders</font></P>
<P style="margin:0pt; padding-left:-45pt; line-height:27pt; font-family:Times New Roman; font-size:25pt" align=center><font face="Arial">to be held May 10, 2005</font></P>
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<P style="margin:0pt; padding-left:-45pt; line-height:27pt; font-family:Times New Roman; font-size:25pt" align=center><B><font face="Arial">Management Proxy Circular</font></B></P>
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<P style="margin:0pt; padding-left:-45pt; line-height:52pt; font-family:Times New Roman; font-size:50pt" align=center><B><font face="Arial">Caledonia</font></B></P>
<P style="margin:0pt; padding-left:-45pt; line-height:32pt; font-family:Times New Roman; font-size:30pt" align=center><font face="Arial">Mining Corporation</font></P>
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<P style="margin:0pt; padding-left:-45pt; text-indent:196.2pt; line-height:16pt; font-family:Courier; font-size:12pt" align=justify><B><font face="Arial">NOTICE OF ANNUAL AND SPECIAL</font></B></P>
<P style="margin:0pt; padding-left:-45pt; text-indent:197.85pt; line-height:16pt; font-family:Shruti; font-size:14pt" align=justify><B><font face="Arial">MEETING OF SHAREHOLDERS</font></B></P>
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<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=left><font face="Arial"><B>TAKE NOTICE </B>that the Annual and Special Meeting of Shareholders of Caledonia Mining Corporation (the &quot;Corporation&quot;) will be held in Boardroom No. 3, 44<SUP>th</SUP> Floor, Scotia Plaza (the offices of the Corporation&#146;s Solicitors, Borden Ladner Gervais LLP), 40 King Street West, Toronto, Ontario, on Tuesday May 10, 2005 commencing at 11:00 a.m. for the purposes of:</font></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:-45pt; font-family:Times New Roman" align=left><font face="Arial">1.</font></P>
<P style="margin:0pt; padding-left:-45pt; text-indent:45pt; font-family:Times New Roman" align=left><font face="Arial">receiving the annual report that includes the financial statements and Auditors' report thereon for the financial year ended December 31, 2004;</font></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:-45pt; text-indent:-36pt; font-family:Times New Roman" align="left"><font face="Arial">2.</font></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align="left"><font face="Arial">considering and, if deemed appropriate, approving an ordinary resolution that the number of directors be set at eight;</font></P>
<P style="margin:0pt; padding-left:-45pt; text-indent:-36pt; font-family:Times New Roman" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:-45pt; text-indent:-36pt; font-family:Times New Roman" align=left><font face="Arial">3.</font></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=left><font face="Arial">electing directors;</font></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:-45pt; text-indent:-36pt; font-family:Times New Roman" align="left"><font face="Arial">4.</font></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align="left"><font face="Arial">appointing Auditors and authorizing the directors to fix their remuneration;</font></P>
<P style="margin:0pt; padding-left:-45pt; text-indent:-36pt; font-family:Times New Roman" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:-45pt; text-indent:-36pt; font-family:Times New Roman" align="left"><font face="Arial">5.</font></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align="left"><font face="Arial">considering and, if deemed appropriate, approve an ordinary resolution that, subject to regulatory approval and in compliance with the policies of The Toronto Stock Exchange, the Corporation be authorized to enter into one or more private placement transactions with subscribers substantially at arm's length to the Corporation, during the ensuing 12 month period, providing for the issuance of up to 75% of the number of common shares outstanding as of the date of the resolution; and</font></P>
<P style="margin:0pt; padding-left:-45pt; text-indent:-36pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:-45pt; text-indent:-36pt; font-family:Times New Roman" align="left"><font face="Arial">6.</font></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align="left"><font face="Arial">transacting such other business as may properly be brought before the meeting.</font></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=left><font face="Arial">A copy of the annual report, form of proxy and management proxy circular accompany this notice. &nbsp;A copy of the Corporation's Form 20F, filed with the United States Securities and Exchange Commission, is available upon request and has been filed on SEDAR as the Corporation&#146;s Annual Information Form.</font></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=left><font face="Arial">Shareholders will be entitled to vote at the meeting in person or by proxy. &nbsp;Shareholders not attending the meeting may exercise their right to vote by promptly signing, dating and returning the proxy in the envelope provided for that purpose &#150; or instruct intermediaries who hold their shares to submit proxies on their behalf</font></P>
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<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=left><font face="Arial">BY ORDER OF THE BOARD</font></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=left><font face="Arial">DATED: &nbsp;March 18, 2005</font></P>
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<font face="Arial">
<BR>
</font>
<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">89</font></P>
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<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=center><B><font face="Arial">MANAGEMENT PROXY CIRCULAR</font></B></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:17.9pt; font-family:Shruti; font-size:12pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><B><font face="Arial">SOLICITATION OF PROXIES</font></B></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial"><B>This Management Proxy Circular is furnished in connection with the solicitation by and on behalf of the management of Caledonia Mining Corporation (the &quot;Corporation&quot;) of proxies to be used at the Annual and Special Meeting (the &quot;Meeting&quot;) of Shareholders of the Corporation to be held on Tuesday, May 10, 2005 at &nbsp;11.00 am local time, in Boardroom #3, 44<SUP>th</SUP> Floor, Scotia Plaza, 40 King Street West, Toronto, Ontario, Canada </B>for the purposes set forth in the accompanying notice of meeting. &nbsp;It is expected that the solicitation will be primarily by mail but proxies may also be solicited personally or by telephone by employees or agents of the Corporation. &nbsp;The cost of any such solicitation by management will be borne by the Corporation.</font></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Shruti" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial"><B>APPOINTMENT AND REVOCATION OF</B> <B>PROXIES</B></font></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial"><B>The persons named in the enclosed form of proxy</B> <B>are directors of the Corporation.</B> &nbsp;<B>A shareholder desiring to appoint some other</B> <B>person to represent him at the Meeting may do so</B> <B>by inserting such person's name, which need not</B> <B>be a shareholder of the Corporation, in the blank</B> <B>space provided in the form of proxy and striking</B> <B>out the names of the persons specified or by</B> <B>completing another proper form of proxy. &nbsp;</B>In all cases, the completed proxy is to be deposited at the registered office of the Corporation or at the offices of Equity Transfer Services Inc., Suite 420, 120 Adelaide Street West, Toronto, Ontario, M5H 4C3 prior to the day of the Meeting or with the Chairman of the Meeting on the day of the Meeting or any adjournment thereof.</font></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Courier; font-size:12pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial">A shareholder giving a proxy has the right to revoke the proxy by instrument in writing executed by the shareholder or by the shareholder's attorney authorized in writing and deposited at the registered office of the Corporation at any time up to and including the last business day preceding the date of the Meeting, or any adjournment thereof, at which the proxy is to be used, or with the Chairman of the Meeting on the date of the Meeting, or any adjournment thereof, or in any other manner permitted by law.</font></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Shruti; font-size:12pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><B><font face="Arial">EXERCISE OF DISCRETION BY PROXIES</font> </B></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><B><font face="Arial">The persons named in the enclosed form of proxy will vote the shares in respect of which they are appointed in accordance with the direction of the shareholders appointing them. &nbsp;In the absence of such direction, such shares will be voted FOR all of the matters referred to in the Notice of Meeting and the re-election of the existing Directors and the election of any new directors.</font></B></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial">The enclosed form of proxy confers discretionary authority upon the persons named therein with respect to any amendments or variations to matters identified in the notice of meeting and with respect to other matters which may properly come before the Meeting. &nbsp;At the time of printing this management proxy circular, management of the Corporation knows of no such amendments, variations or other matters to come before the Meeting.</font></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial"><B>VOTING SHARES AND PRINCIPAL</B> <B>HOLDERS THEREOF</B></font></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial">On February 28, 2005, the Corporation had outstanding 301,112,286 common shares, each carrying the right of one vote per share. &nbsp;To the best of the knowledge of the directors and officers of the Corporation, no person beneficially owns, directly or indirectly, or exercises control or direction over, shares carrying more than 10% of the votes attached to all issued shares of the Corporation.</font></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial">The Board of Directors of the Corporation has fixed the record date as April 6, 2005 for the purpose of determining who is entitled to receive Notice of Meeting. &nbsp;Shareholders entitled to vote at the meeting will be the shareholders of record at 10:00 a.m. (Toronto, Ontario time) on May 9, 2005. &nbsp;The failure of any shareholder to receive notice of the Meeting shall not deprive the shareholder of voting at the Meeting.</font></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Shruti; font-size:12pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><B><font face="Arial">NUMBER OF DIRECTORS</font></B></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial">The directors of the Corporation have considered the most effective composition of the Board of Directors in light of the current business of the Corporation and to comply fully with both regulatory requirements and best practise. The directors have concluded that the composition of the existing board is effective in the overall operation of the Corporation but may be unable to provide adequate independence to some board committees to fully satisfy recently introduced regulatory requirements. &nbsp;In February 2005 the Board of Directors appointed Mr Rupert Pardoe as an independent, non-executive director of the Corporation thus bringing the number of directors to seven. The Board may wish to appoint one other director and therefore recommends that the number of directors of the Corporation be increased to eight.</font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt" align=justify><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
</font>
<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">90</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
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<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><B><font face="Arial">ELECTION OF DIRECTORS</font></B></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial">All of the nominees are now members of the Board of Directors and have been since the dates indicated. &nbsp;Management does not contemplate that any of the nominees will be unable to serve as a director but, if that should occur for any reason prior to the Meeting, the persons named in the enclosed form of proxy reserve the right to vote for another nominee in their discretion. &nbsp;Each director elected will hold office until the next annual meeting or until he ceases to be a director. &nbsp;The names of the persons who will be nominated at the meeting for election as directors are set out below. &nbsp;</font></P>
<P style="margin:0pt; font-family:Courier; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border:0.9pt solid #000000" valign=top width=174><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><B><font face="Arial">Name, Office Held and</font></B></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><B><font face="Arial">Municipality of Residence</font></B></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=258><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:1.15pt; line-height:7.55pt; font-family:Times New Roman" align=center><B><font face="Arial">Principal Occupation</font></B></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=78><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><B><font face="Arial">Director Since</font></B></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=156><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=center><B><font face="Arial">Number of Shares</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=center><B><font face="Arial">Beneficially Owned,</font></B></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><B><font face="Arial">Controlled or Directed</font></B></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=174><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">G.R. Pardoe, <SUP>(2)(3)(4)</SUP></font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">Non-executive Chairman</font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">&amp; Director</font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">Johannesburg, South Africa</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=258><P style="margin:0pt; font-family:Times New Roman"><font face="Arial">&nbsp;Business executive.</font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">From 2001 to 2004 employed by ABSA Bank Limited of Johannesburg, South Africa as Group Executive Director and from 2003 to 2004 as Deputy Group Chief Executive. &nbsp;Prior to this was employed by Anglo American Corporation from 1981 where he was Finance Director from 1997.</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=78><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">February</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">2005</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=156><P style="margin:0pt; font-family:Times New Roman; color:#FF0000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=174><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">S. E. Hayden, <SUP>(2)(3) &nbsp;&nbsp;</SUP>&nbsp;President, Chief Executive Officer &nbsp;&amp; Director</font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">Johannesburg, South Africa</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=258><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">&nbsp;President and Chief Executive Officer of the Corporation and Director of all Caledonia&#146;s subsidiary companies. &nbsp;Chief Executive Officer of Eersteling Gold Mining Company Limited, Greenstone Management Services (Pty) Ltd., and Barbrook Mines Limited.</font> </P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=78><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">1996</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=156><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=174><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">J. Johnstone,</font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">Vice President Operations, Chief Operating Officer</font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">&amp; Director</font> </P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">Oakville, Ontario, Canada</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=258><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">Chief Operating Officer of the Corporation and Director of various subsidiary companies.</font> </P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=78><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">1997</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=156><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">&nbsp;Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=174><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">F. C. Harvey, Technical Director, Secretary &amp; Director, Oakville, Ontario, Canada</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=258><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">Technical Director and Secretary of the Corporation and Director of various subsidiary companies.</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=78><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">1993</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=156><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">&nbsp;4,300</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=174><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">C.R. Jonsson<SUP>,(1)(2)(3)</SUP></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">Director, <SUP>&nbsp;</SUP>Vancouver, British Columbia, Canada</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=258><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">Principal of Tupper, Jonsson &amp; Yeadon, Barristers &amp; Solicitors.</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=78><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">1992</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=156><P style="margin:0pt; line-height:6pt; font-family:Times New Roman; color:#FF0000"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">&nbsp;59,469</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=174><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">W. I. L. Forrest,<SUP>(1)(2)(3)</SUP></font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">Director</font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">Nyon, Switzerland</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=258><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman"><font face="Arial">Business Executive. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=78><P style="margin:0pt; line-height:6pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">1992</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=156><P style="margin:0pt; line-height:6pt; font-family:Times New Roman; color:#FF0000"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.4pt; font-family:Times New Roman" align=center><font face="Arial">&nbsp;&nbsp;17,000</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=174><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">R.G. Fasel, <SUP>(1)(4)</SUP></font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">Director</font> </P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial">Geneva, Switzerland</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=258><P style="margin:0pt; font-family:Times New Roman"><font face="Arial">Director of Fidiuciare with Progesco Geneve SA, public accountants in Geneva, Switzerland from 1989 to present.</font></P>
<P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=78><P style="margin:0pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">2004</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=156><P style="margin:0pt; font-family:Times New Roman; color:#FF0000"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">Nil</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=justify><I><font face="Arial">Notes:</font></I></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=justify><I><font face="Arial"><SUP>(1)</SUP> Member of Audit Committee, <SUP>(2)</SUP> Member of Compensation Committee, <SUP>(3)</SUP> Member of Corporate Governance Committee, &nbsp;&nbsp;</font></I></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=justify><I><font face="Arial">&nbsp;<SUP>(4)</SUP> Member of Nominating Committee.</font></I></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman" align=justify><font face="Arial">The information as to shares beneficially owned or controlled or directed, not being within the knowledge of the Corporation, has been furnished by the respective nominees individually.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial">In compliance with applicable disclosure requirements - C.R. Jonsson has been, within the past 3 years, a director and/or officer of three companies the shares of which were/are listed on the TSX Venture Exchange and its predecessor, in Canada, that were the subject of Cease Trade Orders issued by Provincial Securities Regulators having jurisdiction over them. &nbsp;In the case of each company Mr. Jonsson held the positions incidental to his acting as the Solicitor for the companies:</font></P>
<font face="Arial">
<BR>
</font>
<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">91</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial">-</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; text-indent:61.2pt; font-family:Times New Roman" align=left><font face="Arial">Director and Secretary, August 1987 - August 2003, of Global CT &amp; T Telecommunications Ltd. &nbsp;Cease Trade Order was issued against it for failure to file and distribute financial statements - which has not been rescinded.</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial">-</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; text-indent:61.2pt; font-family:Times New Roman" align=left><font face="Arial">Director and Secretary of Global Net Entertainment Corp. &nbsp;Cease Trade Order was issued against it for failure to file and distribute financial statements - which has not been rescinded.</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial">-</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; text-indent:61.2pt; font-family:Times New Roman" align=left><font face="Arial">Director until February 4, 2005 of TelcoPlus Enterprises Ltd. &nbsp;Cease Trade Order was issued against it for failure to file and &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;distribute financial statements - which was rescinded January 26, 2005.</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align="left"><font face="Arial">Walter Ian Logan Forrest became a director of AB Airlines plc on 30June 1999 and resigned on 30 July 1999. On 2 August 1999, AB Airlines plc was placed in administrative receivership.</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align="left"><B><font face="Arial">APPOINTMENT OF AUDITORS</font> </B></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial">The shareholders will be asked to vote for the appointment of BDO Dunwoody LLP<B> </B>as Auditors of the Corporation, to hold office until the next annual meeting of shareholders or until their successors are duly elected or appointed, &nbsp;at remuneration to be fixed by the Board of Directors. &nbsp;Approval of the ordinary resolution requires the affirmative vote of a majority of the votes cast in respect thereof by holders of Common Shares represented at the meeting.</font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<font face="Arial">
<BR>
</font>
<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">92</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman"><B><font face="Arial">REPORT ON EXECUTIVE COMPENSATION</font></B></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=justify><B><I><font face="Arial">Compensation of Named Executive Officers</font></I></B></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial">The following table, presented in accordance with the applicable regulation (the &quot;Regulation&quot;) under the Securities Act (Ontario), sets forth all annual and long term compensation for services in all capacities to the Corporation and its subsidiaries for the fiscal year ended December 31, 2004 in respect of the named executive officers:</font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; text-indent:224.45pt; font-family:Times New Roman"><B><font face="Arial">Summary Compensation Table</font></B></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border-left: 0.9pt solid #000000; border-right: 1 solid #000000; border-top: 0.9pt solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.9pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=485.6 colspan=12><P style="margin:0pt; line-height:2.9pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:0.4pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Annual Compensation &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long Term Compensation</font></B></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:2.9pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
</TD></TR>
<TR><TD style="border-left: 0.9pt solid #000000; border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.9pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right: 0.75pt solid #FFFFFF; border-bottom: 1 solid #000000" valign=top width=18><P style="margin:0pt; line-height:2.9pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right: 0.75pt solid #FFFFFF; border-bottom: 1 solid #000000" valign=top width=89.6 colspan=3><P style="margin:0pt; line-height:2.9pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right: 0.75pt solid #FFFFFF; border-bottom: 1 solid #000000" valign=top width=48 colspan=3><P style="margin:0pt; line-height:2.9pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right: 0.5pt solid #000000; border-bottom: 1 solid #000000" valign=top width=120 colspan=2><P style="margin:0pt; line-height:2.9pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right: 0.5pt solid #000000; border-top: 1 solid #000000; border-bottom: 0.5pt solid #000000" valign=top width=144 colspan=2><P style="margin:0pt; line-height:2.9pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:0.4pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Awards</font></B></P>
</TD><TD style="border-right: 0.9pt solid #000000; border-top: 1 solid #000000; border-bottom: 0.5pt solid #000000" valign=top width=66><P style="margin:0pt; line-height:2.9pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:0.4pt; font-family:Times New Roman" align=center><B><font face="Arial">Payouts</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:2.9pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
</TD></TR>
<TR><TD style="border-left: 0.9pt solid #000000; border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=54 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=60 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=102><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Securities</font></B></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Restricted</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman"><font face="Arial"><BR></font></P>
</TD></TR>
<TR><TD style="border-left: 0.9pt solid #000000; border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=54 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=60 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=102><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Under</font></B></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Shares or</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD></TR>
<TR><TD style="border-left: 0.9pt solid #000000; border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><B><font face="Arial">Name and</font></B></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=54 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=60 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=102><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Other Annual</font></B></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">&nbsp;Options/</font></B></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Restricted</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">LTIP</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">All other</font></B></P>
</TD></TR>
<TR><TD style="border-left: 0.9pt solid #000000; border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><B><font face="Arial">Principal</font></B></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=54 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Salary</font></B></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=60 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Bonus</font></B></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=102><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Compensation</font></B></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">SARs</font></B></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Share Units</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Payouts</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Compensation</font></B></P>
</TD></TR>
<TR><TD style="border-left: 0.9pt solid #000000; border-right: 1 solid #000000; border-bottom: 0.9pt solid #000000" valign=top width=132.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><B><font face="Arial">Position</font></B></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.9pt solid #000000" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Year</font></B></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.9pt solid #000000" valign=top width=54 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">($)</font></B></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.9pt solid #000000" valign=top width=42 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">($)</font></B></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=120 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">($) <SUP>(1)</SUP></font></B></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.9pt solid #000000" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Granted (#)</font></B></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.9pt solid #000000" valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">(#)</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">($)</font> </B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">($)</font></B></P>
</TD></TR>
<TR><TD style="border-left: 0.9pt solid #000000; border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.4pt; font-family:Courier; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF" valign=top width=24 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Courier; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF" valign=top width=89.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Courier; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF" valign=top width=42 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Courier; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right: 1 solid #000000" valign=top width=120 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Courier; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Courier; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Courier; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Courier; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Courier; font-size:9pt"><font face="Arial"><BR></font></P>
</TD></TR>
<TR><TD style="border-left: 0.9pt solid #000000; border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">Stefan E. Hayden<SUP> (2)(3)</SUP></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">2004</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">225,000</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF" valign=top width=39.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-right: 1 solid #000000" valign=top width=120 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">42,000</font></P>
</TD><TD valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">7,500</font> </P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">President, &amp; Chief</font> </P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">2003</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">180,000</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF" valign=top width=39.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-right: 1 solid #000000" valign=top width=120 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">5,000</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">Executive &nbsp;Officer</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">2002</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">180,000</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">4,000,000</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">5,000</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><font face="Arial">&nbsp;</font></TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.9pt solid #0000
00; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">Jim Johnstone <SUP>(3)</SUP></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF" valign=top width=39.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right: 1 solid #000000" valign=top width=120 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">Vice President</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">2004</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">207,200</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF" valign=top width=39.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-right: 1 solid #000000" valign=top width=120 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">7,500</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">Operations and</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">2003</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">207,200</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF" valign=top width=39.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-right: 1 solid #000000" valign=top width=120 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">5,000</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">Chief Operating</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">2002</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">207,200</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">2,000,000</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">5,000</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">Officer</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">F.Chris Harvey &nbsp;<SUP>(3)</SUP></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">2004</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">150,000</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font> </P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">7,500</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Technical Director</font> </P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">2003</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">150,000</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font> </P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">5,000</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">and Secretary</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">2002</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">150,000</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">-</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">2,000,000</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font> </P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">5,000</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin-top:0pt; margin-bottom:0.4pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Steve Poad <SUP>(4)(5)</SUP></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;2004</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">32,720 &nbsp;&nbsp;&nbsp;&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- &nbsp;&nbsp;</font></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">200,000</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin-top:0pt; margin-bottom:0.4pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Controller</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;2003</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">26,971</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-</font></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;2002</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">19,914 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- &nbsp;&nbsp;&nbsp;&nbsp;</font></P>
</TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">150,000</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><font face="Arial">&nbsp;</font></TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.9pt solid #0000
00; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin-top:0pt; margin-bottom:0.4pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Jacques du Plessis</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">&nbsp;&nbsp;&nbsp;2004</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">306,000</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><font face="Arial">&nbsp;</font></TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin-top:0pt; margin-bottom:0.4pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">General Manager</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">&nbsp;&nbsp;&nbsp;2003</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">46,392</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><font face="Arial">&nbsp;</font></TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">200,000</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">&nbsp;&nbsp;&nbsp;2002</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt"><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><font face="Arial">&nbsp;</font></TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><font face="Arial">&nbsp;</font></TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.9pt solid #0000
00; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin-top:0pt; margin-bottom:0.4pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Mike D Tombs<SUP>(5)</SUP></font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; font-family:Times New Roman"><font face="Arial">&nbsp;&nbsp;&nbsp;2004</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; font-family:Times New Roman"><font face="Arial">103,594</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><font face="Arial">&nbsp;</font></TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">100,000</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin-top:0pt; margin-bottom:0.4pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Vice President</font></P>
<P style="margin-top:0pt; margin-bottom:0.4pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">F Financ</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; font-family:Times New Roman"><font face="Arial">&nbsp;&nbsp;&nbsp;2003</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; font-family:Times New Roman"><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><font face="Arial">&nbsp;</font></TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=132.333><P style="margin-top:0pt; margin-bottom:0.4pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Finance and Chief</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=59.6 colspan=3><P style="margin:0pt; font-family:Times New Roman"><font face="Arial">&nbsp;&nbsp;&nbsp;2002</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=56.667 colspan=3><P style="margin:0pt; font-family:Times New Roman"><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.75pt solid #FFFFFF" valign=top width=39.333><font face="Arial">&nbsp;</font></TD><TD style="border-right: 1 solid #000000; border-bottom: 0.75pt solid #FFFFFF" valign=top width=120 colspan=2><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=78><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=66><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=90><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=132.333><P style="margin-top:0pt; margin-bottom:0.4pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">Financial Officer</font></P>
</TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.9pt solid #000000" valign=top width=59.6 colspan=3><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.9pt solid #000000" valign=top width=56.667 colspan=3><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.75pt solid #FFFFFF; border-bottom:0.9pt solid #000000" valign=top width=39.333><font face="Arial">&nbsp;</font></TD><TD style="border-right: 1 solid #000000; border-bottom: 0.9pt solid #000000" valign=top width=120 colspan=2><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.9pt solid #000000" valign=top width=66><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.9pt solid #000000" valign=top width=78><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=66><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valig
n=top width=90>
    <p align="left"><font face="Arial">&nbsp;</font></p>
  </TD></TR>
</TABLE>
<P style="margin:0pt; padding-right:-36.1pt; text-indent:-45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align="left"><I><font face="Arial">Notes:</font></I></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=left><font face="Arial"><I><SUP>(1)</SUP> &nbsp;&nbsp;Perquisites and other personal benefits for each of the named</I> <I>executive officers, with the exception of Mr. Hayden did not exceed the lesser of $50,000 and 10%</I> <I>of total annual salary and bonus in 2002, 2003 and 2004.</I> </font> </P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=left><I><font face="Arial"><SUP>(2) </SUP>&nbsp;&nbsp;Mr. S. E. Hayden is employed indirectly by the Corporation through a management and administrative agreement.</font> </I></P>
<P style="margin:0pt; padding-left:-45pt; padding-right:-36.1pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=left><I><font face="Arial"><SUP>(3)</SUP> &nbsp;&nbsp;The figures shown are the agreed salaries. The Officers noted have, in recognition of the Corporation&#146;s cash position in the respective years, agreed to defer an aggregate total of $302,201 of the salaries due them for the period ending December 31, 2001 and further amounts totaling $173,067 and $383,810 for the periods ending December 31, 2000 and December 31, 1999 respectively. During 2003 Mr. Johnstone was paid in full the sum of $278,666.33. &nbsp;Mr. Harvey was paid $100,000.00 in 2003 and was paid the balance of his outstanding salary in 2004. Epicure was paid the full outstanding balance pertaining to the management and administrative agreement relating to Mr. Hayden during 2003 and 2004.</font></I></P>
<P style="margin:0pt; padding-left:-45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=left><I><font face="Arial"><SUP>(4)</SUP> &nbsp;Mr. S. Poad is employed indirectly by the Corporation through a service contract with Doelcam Inc.</font></I></P>
<P style="margin:0pt; padding-left:-45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=left><I><font face="Arial"><SUP>(5)</SUP> Mr. S. Poad served as VP Finance until June 24, 2004. &nbsp;Mr. M. Tombs was appointed as VP Finance and CFO on June 24, 2004.</font></I></P>
<P style="margin:0pt; padding-left:-45pt; font-family:Times New Roman; font-size:9pt" align=left><font face="Arial"><BR></font></P>
&nbsp;<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">93</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-45pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align="left"><font face="Arial">The following table (presented in accordance with the Regulation) sets forth stock options granted by the Board of Directors of the Corporation during the fiscal year ended December 31, 2004 to the named executive officers:</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Option/SAR Grants in Last Fiscal Year</font></B></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR><TD style="border:0.5pt solid #000000" valign=bottom width=102.267><P style="margin:0pt; line-height:6pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Name</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=bottom width=112>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=center>&nbsp;</P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Securities Under</font></B></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Options/SARs</font></B></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Granted #</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=bottom width=112.133>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=center>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">% of Total Options/SARs Granted to Employees in Fiscal Year</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=bottom width=103.467><P style="margin:0pt; line-height:6pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Exercise or Base Price ($/Security)</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=bottom width=120.8>
<P style="margin-top:0pt; margin-bottom:2.2pt; font-family:Times New Roman; font-size:9pt" align=center>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Market Value of Securities Underlying Options/SARs on Date of Grant ($/Security)</font></B></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=bottom width=77.2><P style="margin:0pt; line-height:6pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Expiration Date</font></B></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=102.267><P style="margin-top:0pt; margin-bottom:2.2pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">M.D. Tombs</font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">S.W. Poad</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=112><P style="margin-top:0pt; margin-bottom:2.2pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">100,000</font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">200,000</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=112.133><P style="margin-top:0pt; margin-bottom:2.2pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">8.3</font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">16.5</font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=103.467><P style="margin-top:0pt; margin-bottom:2.2pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">0.26</font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">0.26</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=120.8><P style="margin-top:0pt; margin-bottom:2.2pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">0.26</font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">0.26</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=77.2><P style="margin-top:0pt; margin-bottom:2.2pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">April 29, 2014</font></P>
<P style="margin-top:0pt; margin-bottom:2.2pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">April 29, &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2014</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=justify><font face="Arial">The following table (presented in accordance with the Regulation) sets forth stock options exercised by<B> </B>the named executive officers during the fiscal year ended December 31, 2004:</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Option/SAR Exercises in Last Fiscal Year</font></B></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border-left:0.9pt solid #000000; border-top:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=98><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-top:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-top:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-top:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-top:0.9pt solid #000000; border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Value of Unexercised in-</font></B></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=98><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Unexercised</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">the-Money <SUP>(1)</SUP></font></B></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=98><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Securities</font></B></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Options/SARs at</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Options/SARs at</font></B></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=98><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Acquired</font></B></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">December 31, 2004</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">December 31, 2004</font></B></P>
</TD></TR>
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</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">on</font></B></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Aggregate Value</font></B></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">(#)</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">($)</font></B></P>
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<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=98><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Exercise</font></B></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Realized</font></B></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Exercisable/</font></B></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Exercisable/</font></B></P>
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<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=98><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:0.4pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Name</font></B></P>
</TD><TD style="border-bottom:0.9pt solid #000000" valign=top width=76.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:0.4pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">(#)</font></B></P>
</TD><TD style="border-bottom:0.9pt solid #000000" valign=top width=124.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:0.4pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">($)</font></B></P>
</TD><TD style="border-bottom:0.9pt solid #000000" valign=top width=153.6><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:0.4pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Unexercisable</font></B></P>
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<P style="margin-top:0pt; margin-bottom:0.4pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><B><font face="Arial">Unexercisable</font></B></P>
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</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
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<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=98><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">S. E. Hayden</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">4,300,000/Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil/Nil</font></P>
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<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=98><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=98><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">J. Johnstone</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">2,172,500/Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil/Nil</font></P>
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<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=98><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=98><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">F. C. Harvey</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">2,228,750/Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><P style="margin:0pt; line-height:2.4pt; font-family:Times New Roman; font-size:9pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil/Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=98><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=98><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">S. Poad</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">448,825/Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil/Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=98><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=98><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">J. du Plessis</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">200,000/300,000</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil/Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=98><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><font face="Arial">&nbsp;</font></TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=98><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">M.D. Tombs</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=76.8><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=124.8><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil</font></P>
</TD><TD style="border-bottom:0.75pt solid #FFFFFF" valign=top width=153.6><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">100,000/Nil</font></P>
</TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.75pt solid #FFFFFF" valign=top width=158.8><P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=center><font face="Arial">Nil/Nil</font></P>
</TD></TR>
<TR><TD style="border-left:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=98><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.9pt solid #000000" valign=top width=76.8><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.9pt solid #000000" valign=top width=124.8><font face="Arial">&nbsp;</font></TD><TD style="border-bottom:0.9pt solid #000000" valign=top width=153.6><font face="Arial">&nbsp;</font></TD><TD style="border-right:0.9pt solid #000000; border-bottom:0.9pt solid #000000" valign=top width=158.8><font face="Arial">&nbsp;</font></TD></TR>
</TABLE>
<P style="margin:0pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align="left"><I><font face="Arial">Notes:</font></I></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-36pt; line-height:11pt; font-family:Times New Roman; font-size:9pt" align=left><I><font face="Arial"><SUP>(1)</SUP> &nbsp;&quot;In-the-money&#148; means the excess of the market value of the common shares of the Corporation outstanding on December 31 2004 over the exercise price of the options</font></I></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial">The Corporation does not have a long-term incentive plan, a pension plan or other form of defined benefit plan &#150; other than its Stock Option Plan.</font></P>
&nbsp;<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">94</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><B><I><font face="Arial">Termination of Employment, Change of Responsibilities and Employment Contracts</font></I></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial">There are no service contracts between Caledonia and any of the Directors of Caledonia or its subsidiaries except for (i) a &quot;Key Executive Severance Protection Plan&quot; between Caledonia and two of its directors - namely Mr. S.E. Hayden and Mr. F. C. Harvey dating from 1996, (ii) the indirect employment of Mr. S.E.Hayden through a management and administrative agreement and (iii) an employment contract with a director, Mr. J. Johnstone. &nbsp;The &#147;Severance Plan&#148; calls for severance payments to these executives if employment is terminated as a result of a change of control of Caledonia. &nbsp;Mr. Johnstone&#146;s employment contract with Caledonia has a termination clause whereby Mr. Johnstone is paid a severance payment of one year of salary in the event of his termination due to change of control or without cause.</font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><B><I><font face="Arial">Composition of the Compensation Committee</font></I></B> </P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial">The Corporation has a Compensation Committee (&#147;Committee&#148;) comprised of three members. &nbsp;All issues as to compensation of &nbsp;the Officers are considered by the Committee, the members of which, during the fiscal year ended December 31, 2004, were C. R. Jonsson (Chairman), W. I. L. Forrest and &nbsp;S. E. Hayden. &nbsp;Mr. S. E. Hayden as President and CEO of the Corporation is therefore an inside director. Mr. Hayden abstained from voting on compensation matters pertaining to him. &nbsp;Mr. G.R. Pardoe was appointed &nbsp;as a fourth member of this committee in March 2005. &nbsp;Mr. C. R. Jonsson was granted 1,000,000 stock options in 2002 in lieu of being paid for legal services provided by him. He has therefore been a service provider within the past three years and may be considered a related director under recently adopted OSC rules. &nbsp;Mr. Jonsson continues to provide the company with legal services on a 
no-fee basis. &nbsp;The Board considers that this situation does not interfere with Mr. Jonsson&#146;s ability to act with a view to the best interests of the company and therefore considers him to be an unrelated director. &nbsp;Mr. W. I. L. Forrest is an outside and unrelated director within the meaning of The Toronto Stock Exchange (&#147;TSX&#148;) Report on Corporate Governance Practices.</font></P>
<P style="margin:0pt; font-family:Shruti; font-size:12pt" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><B><I><font face="Arial">Compensation Policies</font></I></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial">While the &nbsp;Board &nbsp;has not adopted a written policy concerning the compensation of executive officers, it has developed a consistent approach and philosophy relating to executive compensation. &nbsp;The overriding principles in the determination of executive compensation are the need to provide total compensation packages that will attract and retain qualified and experienced executives, to reward the executives for their contribution to the overall success of the Corporation and to integrate the longer-term interest of the executives with the investment objectives of the Corporation's shareholders.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial">Executive compensation at the Corporation has two principal components: salary and stock options. &nbsp;The Committee is mindful that the Corporation competes within the framework of the international mining industry. &nbsp;The Compensation Committee is of the view that a competitive salary level is appropriate for the executive officers, as their total compensation package should emphasize salaries and the stock options granted by the Corporation. &nbsp;The Chief Executive Officer of the Corporation is one of the named executive officers and therefore his compensation is determined in the same manner as for the other executive officers of the Corporation but with the proviso that he abstains from discussion and voting on any such personal compensation determination.</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><B><I><font face="Arial">Compensation of Directors</font></I></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial">Effective July 1, 2004 each of the directors, including directors who are officers of the Corporation, is entitled to an annual director's fee of $10,000 Canadian and out of pocket expenses relating to attendance at a board or committee meeting. &nbsp;Prior to 2004 directors were paid an annual directors fee of $5,000. &nbsp;For 2004, Mr. Fasel, who joined the board at mid-year was paid $5,000 on a pro-rata basis, the other five directors were each paid $7,500 for 2004. The Corporation obtained, in June, 2003, liability insurance for directors and officers of the Corporation and its affiliates with coverage of $1,000,000 Canadian per occurrence and in the aggregate.</font></P>
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<P style="margin:0pt; font-family:Courier; font-size:12pt" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align=left><font face="Arial"><BR></font></P>
&nbsp;<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">95</font></P>
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<P style="margin:0pt; font-family:Times New Roman" align=left><B><font face="Arial">PERFORMANCE GRAPH</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial">The following graph and table compares the year-end value of the common shares of the Corporation with the TSX 300 Stock Index for the last five years on the basis of cumulative total return.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left>&nbsp;</P>
<P style="margin:0pt; font-family:Times New Roman" align=left>&nbsp;</P>
<P style="margin:0pt; font-family:Times New Roman" align=left>&nbsp;</P>
<P style="margin:0pt; font-family:Times New Roman" align=left>&nbsp;</P>
<P style="margin:0pt; font-family:Times New Roman" align=left>&nbsp;</P>
<P style="margin:0pt; font-family:Times New Roman" align=left>&nbsp;</P>
<P style="margin:0pt; font-family:Times New Roman" align=left>&nbsp;</P>
<P style="margin:0pt; font-family:Times New Roman" align=left><img border="0" src="argosy007.gif" width="481" height="212"></P>
<P style="text-indent: 0; font-family: Courier; font-size: 12pt; margin: 0pt; padding-left: 252pt" align=center>&nbsp;</P>
<P style="text-indent: 0; font-family: Courier; font-size: 12pt; margin: 0pt; padding-left: 252pt" align=center>&nbsp;</P>
<P style="margin:0pt; padding-left:252pt; text-indent:-252pt; font-family:Courier; font-size:12pt" align=left>&nbsp;</P>
<P style="margin:0pt; padding-left:252pt; text-indent:-252pt; font-family:Courier; font-size:12pt" align=left>&nbsp;</P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD style="border:0.5pt solid #000000" valign=top width=173.733><font face="Arial">&nbsp;</font></TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.8><P style="margin:0pt; font-family:Times New Roman" align=center><U><font face="Arial">Dec 1999</font></U></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.8><P style="margin:0pt; font-family:Times New Roman" align=center><U><font face="Arial">Dec 2000</font></U></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.733><P style="margin:0pt; font-family:Times New Roman" align=center><U><font face="Arial">Dec 2001</font></U></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.733><P style="margin:0pt; font-family:Times New Roman" align=center><U><font face="Arial">Dec 2002</font></U></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.733><P style="margin:0pt; font-family:Times New Roman" align=center><U><font face="Arial">Dec 2003</font></U></P>
</TD><TD style="border-top:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.8><P style="margin:0pt; font-family:Times New Roman" align=center><U><font face="Arial">Dec 2004</font></U></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=173.733><P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">S&amp;P/TSX Composite</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.8><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">100</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.8><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">107</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.733><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">92</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.733><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">79</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.733><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">98</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.8><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">111</font></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=173.733><P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">Caledonia Common Shares</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.8><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">100</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.8><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">140</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.733><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">110</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.733><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">820</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.733><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">840</font></P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=64.8><P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial">260</font></P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><B><font face="Arial">CORPORATE GOVERNANCE PRACTISE</font></B></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; text-indent:108pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=justify><font face="Arial">The TSX Committee on Corporate Governance in Canada issued a report (the &quot;TSX Report&quot;) in December 1994 containing guidelines for effective corporate governance of corporations. &nbsp;The by-laws of the TSX were subsequently amended to require each listed corporation incorporated in Canada to make annual disclosure of its corporate governance practise with reference to those guidelines. &nbsp;The Corporation's Statement of Corporate Governance Practices, which has been prepared by the Corporate Governance Committee, follows:</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><B><I><font face="Arial">Mandate of the Board</font></I></B></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial">The Board of Directors of the Corporation is responsible for the overall stewardship of the Corporation, and has full power and authority to manage and control the affairs and business of the Corporation. &nbsp;Amongst other things, the Board is responsible for:</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">1.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">supervising the officers of the Corporation in their management of the business and affairs of the Corporation;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">2.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">adoption of and managing the Corporation's strategic planning process;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">3.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">identifying and managing principal risks to the Corporation's business;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">4.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">succession planning including the
appointment, training, monitoring and appraisal of senior officers of the Corporation;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">5.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">overseeing the administration of a policy for communications by the Corporation with shareholders, the investment</font>
<font face="Arial">community, the media, governments and the general public;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">6.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">examination, through its Audit Committee, of the effectiveness of the company&#146;s internal control processes and management information systems. &nbsp;The Board consults with the VP Finance and management of the Corporation to ensure the integrity of these systems; &nbsp;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">7.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">developing position descriptions and terms of reference for the Board, the President and Chief Executive Officer and the committees of the Board; and</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">8.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">ensuring that Directors may hire outside advisors, at the expense of the company, in appropriate circumstance</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; font-family:Times New Roman" align=left><font face="Arial">The Board holds regular meetings. &nbsp;Additional meetings are held to address special items of business. &nbsp;The frequency of meetings, as well as the nature of agenda items, changes depending upon the state of the Corporation's affairs and in light of opportunities or risks which the Corporation faces. On average the Board has met between nine and ten times per year during the past five years.</font> </P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
&nbsp;<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">96</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
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<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Courier; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; font-family:Times New Roman" align=left><font face="Arial">In 2004 the Board adopted a Charter of the Board of Directors. &nbsp;This Charter can be viewed at the Corporations head office, at the Annual Meeting of Shareholders and on the Corporation&#146;s website at www.caledoniamining.com.</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; font-family:Times New Roman" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; font-family:Times New Roman" align="left"><B><I><font face="Arial">Board Composition</font></I></B></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; font-family:Times New Roman" align=left><font face="Arial">The TSX Report recommends that a majority of the Board be unrelated to the Corporation. &nbsp;The TSX Report uses the term unrelated director to mean a director who is independent of management and is free from any interest and any business or other relationship which could, or could reasonably be perceived to, materially interfere with the director's ability to act with a view to the best interests of the Corporation, other than interests and relationships arising from shareholding.</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; font-family:Times New Roman" align=left><font face="Arial">The Board has concluded that four of the seven directors, Messrs. Fasel, Forrest, Jonsson and Pardoe, are unrelated directors within the meaning of the TSX Report. &nbsp;In reaching that conclusion, the Board has examined the factual circumstances of each director and has considered any interests and business or other relationship that any director may have with the Corporation. &nbsp;Mr. S. E. Hayden is a related director by virtue of his position as the President and Chief Executive Officer of the Corporation and Messrs. J. Johnstone and F. C. Harvey are
related directors by virtue of their positions as employees of the Corporation. &nbsp;The Board believes that the extensive knowledge of Messrs. Hayden, Johnstone and Harvey of the Corporation's business is beneficial to the other directors and their participation as directors contributes to the effectiveness of the Board.</font></P>
<P style="margin:0pt; padding-right:-27.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; font-family:Times New Roman" align=left><font face="Arial">Caledonia&#146;s Board members consider that the Board&#146;s current composition is efficient and appropriate considering the extent of the Corporation&#146;s activities and the location of the properties on which most of its activities are conducted. &nbsp;It is the opinion of the four unrelated Directors, Messrs Fasel, Forrest, Jonsson and Pardoe that the Board functions adequately independently of management. &nbsp;However, they believe that the Corporation will benefit from the addition of independent directors. The Corporation recently invited Mr. Pardoe to join the board and is actively seeking an additional qualified independent director. The Board has elected Mr. Pardoe as Chairman and has thereby, in the interest of sound corporate governance, separated the positions of Chairman and President both of which were previously held by Mr. Hayden.</font> </P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; font-family:Times New Roman" align=left><font face="Arial">The Board determines each year the number of directors to be elected at the annual general meeting. &nbsp;Under the articles of the Corporation, the number of directors of the Corporation must be at least three. &nbsp;For 2005, the Board has concluded that the number of directors should be further increased to satisfy the Corporate Governance requirements regarding independent directors. &nbsp;At the 2005 Annual Meeting of Shareholders the Board of Directors will request the shareholders to approve increasing the number of directors to eight.</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; font-family:Times New Roman" align=left><font face="Arial">The Corporation does not have a significant shareholder, defined in the TSX Report as a shareholder with the ability to exercise a majority of votes for the election of directors.</font></P>
<P style="margin:0pt; padding-right:-27.1pt; font-family:Courier; font-size:12pt" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align="left"><B><I><font face="Arial">Board Committees</font></I></B></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; font-family:Times New Roman" align=left><font face="Arial">The Board of Directors has four standing committees: the Audit Committee, the Compensation Committee, the Corporate Governance Committee and the Nominating Committee. &nbsp;The Board has established a policy to strive to implement the recommendations of the TSX Report wherever possible and practical.</font> </P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align="left"><B><I><font face="Arial">Audit Committee</font></I></B></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-27.1pt; font-family:Times New Roman" align=left><font face="Arial">The Audit Committee, which is chaired by Mr. Forrest, is currently composed entirely of, unrelated directors. &nbsp;In 2004, Mr. Fasel was appointed to the Audit committee and at the same time the related director, Mr. Hayden resigned his position. &nbsp;The members of the Audit Committee, the internal accounting staff and the external auditors have unrestricted direct access to, and communication with, each other to assist them in carrying out their respective duties. &nbsp;The Audit Committee is responsible for reviewing and making recommendations to the Board on:</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">1.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">financial statements and the related reports of management and external auditors;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">2.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">accounting and financial reporting procedures and methods;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">3.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">internal audit procedures and reports, and matters relating to external auditors, including the appointment and terms of engagement of external auditors and their reports relating to accounting, financial and internal audit matters.</font></P>
<P style="margin:0pt; padding-left:-36pt; text-indent:27pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><font face="Arial">During 2004 the Board adopted a &#147;Charter of the Audit Committee&#148; which is to be reviewed annually. &nbsp;This Charter can be viewed at the Corporation&#146;s head office, at the Annual Meeting of Shareholders and on the Corporation&#146;s website at <FONT COLOR=#0000FF><U>www.caledoniamining.com</U></FONT>.</font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Courier; font-size:12pt" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=left><B><I><font face="Arial">Compensation Committee</font></I></B></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial">The Compensation Committee is currently composed of one related and three unrelated directors. &nbsp;The Board believes &nbsp;that the participation of Mr. Hayden, the related director, is important to the business of this committee. Mr. Pardoe was recently appointed to this Committee which he will chair. &nbsp;The Committee is responsible for making recommendations to the Board on:</font></P>
&nbsp;<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">97</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">1.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">compensation of officers and senior employees of the Corporation, including stock option incentives;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">2.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">succession planning for officers of the Corporation;</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=left><B><I><font face="Arial">Corporate Governance Committee</font></I></B></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial">The Corporate Governance Committee is currently composed of three unrelated and one related directors. &nbsp;The Board believes &nbsp;that the participation of Mr. Hayden, the related director, is important to the business of this committee. Mr. Pardoe was recently appointed to this Committee which he will chair. &nbsp;The Committee has general responsibility for developing the approach of the Corporation to matters of corporate governance, which includes the responsibility for:</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">1.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">assessing, at least annually, the effectiveness of the Board as a whole and the committees of the Board;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">2.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">reviewing annually the mandates of the Board and its committees and making recommendations for change;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">3.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">recommending procedures to permit the Board to function independently from management;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">4.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">seeing to the adequacy of the orientation and education programs for new members of the Board;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">5.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">determining annually which directors should be considered to be unrelated directors, and recommending such determination to the Board;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">6.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">preparing annually and recommending to the Board a &#147;Statement of Corporate Governance Practices&#148;; and</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">7.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">overseeing the Corporation's policy for communications with shareholders, the investment community, the media, governments and the general public</font></P>
<P style="margin:0pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=left><B><I><font face="Arial">Nominating Committee</font></I></B></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial">The Nominating Committee was composed of one unrelated and one related director during 2004. &nbsp;In accordance with the TSX recommendations the Board has appointed only unrelated directors, Mr. Fasel and Mr. Pardoe to this committee during 2005. &nbsp;The Committee, which is chaired by Mr. Pardoe, is responsible for:</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">1.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">identifying prospective nominees for the Board and recommending them to the Board; and</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">2.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">establishing criteria for Board membership and retirement therefrom.</font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=left><B><I><font face="Arial">Decisions Requiring Board Approval</font></I></B></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial">As part of the Board's responsibility for the strategic planning process of the Corporation, the Board considers and, where appropriate, adopts the goals of the business that are proposed by Management and the strategies and policies within which the Corporation is managed. &nbsp;Management is required to seek the approval of the Board for material deviations, financial or otherwise, from the approved business goals, strategies and policies of the Corporation.</font></P>
<P style="margin:0pt; padding-right:-36.1pt; font-family:Times New Roman; font-size:11pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=left><B><I><font face="Arial">Shareholder Feedback</font></I></B></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial">It is the Corporation's policy that communications with shareholders, the investment community, the media, governments and the general public are handled by the CEO through the South African &nbsp;office located in Johannesburg.</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman; font-size:11pt" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=left><B><I><font face="Arial">Expectations of Management</font></I></B></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial">The Board requires management to keep the Board informed in a timely and candid manner of the progress of the Corporation towards the achievement of its established goals, and of any material deviations from such goals and from corporate strategies and policies approved by the Board.</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=left><font face="Arial"><B><I>Other Corporate Governance Segments</I></B><I>.</I></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial">&nbsp;The Board has reviewed the TSX Guidelines on Corporate Governance and concluded that the Corporation complies with the guidelines except in two areas, namely &nbsp;&nbsp;&nbsp;(i) Assessing the board&#146;s effectiveness, &nbsp;and (ii) Orientation and education of directors,. The board expects to comply with these outstanding guidelines during 2005.</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; line-height:14pt; font-family:Courier; font-size:12pt" align=left>&nbsp;</P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=left><B><I><font face="Arial">Additional Information</font></I></B></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial">Additional information relating to the Corporation is on SEDAR at <FONT COLOR=#0000FF><U>www.sedar.com</U></FONT> and on the Corporation&#146;s website at <FONT COLOR=#0000FF><U>www.caledoniamining.com</U></FONT> &nbsp;&nbsp;Financial information is provided in the Corporation&#146;s comparative financial statements and MD&amp;A.</font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><font face="Arial">Copies of the Corporation&#146;s financial statements and MD&amp;A can be obtained by contacting the company&#146;s head office at:</font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; text-indent:180pt; font-family:Times New Roman" align=left><font face="Arial">Unit #9, 2145 Dunwin Drive</font></P>
<P style="margin:0pt; padding-left:-36pt; text-indent:180pt; font-family:Times New Roman" align=left><font face="Arial">Mississauga</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:-36pt; text-indent:180pt; font-family:Times New Roman" align=left><font face="Arial">Ontario, Canada</font></P>
<P style="margin:0pt; padding-left:-36pt; text-indent:252pt; font-family:Times New Roman" align=left><font face="Arial">L5L 4L9</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:-36pt; text-indent:180pt; font-family:Times New Roman" align=left><font face="Arial">Phone:</font></P>
<P style="margin:0pt; padding-left:-36pt; text-indent:216pt; font-family:Times New Roman" align=left><font face="Arial">+1-905-607-7543</font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left>&nbsp;</P>
&nbsp;<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">98</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
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<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align="left"><B><font face="Arial">FINANCING</font></B></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><font face="Arial">The Corporation from time to time investigates opportunities to raise financing on advantageous terms and seeks the flexibility to enter into private placement agreements, if required, which could result in the issue of up to 75% of the number of shares issued and outstanding at this time.</font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman; color:#FF0000" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><font face="Arial">The Directors are pursuing the listing of Caledonia shares on the Alternative Investment Market in London in conjunction with an appropriate financing.</font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left>&nbsp;</P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><font face="Arial">Under the rules of the TSX the aggregate number of shares of a listed company which are issued or made subject to issuance (i.e. issuable under a share purchase warrant or option or other convertible security) for a financing by way of one or more private placement transactions during any particular six-month period must not exceed 25% of the number of shares outstanding (on a non-diluted basis) prior to giving effect to such transactions (the &quot;TSX 25% Rule&quot;), unless there has been shareholder approval of such transactions.</font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><font face="Arial">The application of the TSX 25% Rule may restrict the availability to the Corporation of funds which it may wish to raise in the future by private placement of its securities or similar financing routes. &nbsp;The TSX has a working practice that it will accept advance approval by shareholders in anticipation of private placements that may exceed the TSX 25% Rule, provided such private placements are completed within 12 months of the date such advance shareholder approval is given.</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><font face="Arial">Any private placement proceeded with by the Corporation under the advance approval being sought at the Meeting will be subject to the following additional restrictions:</font></P>
<P style="margin:0pt; padding-left:18pt; text-indent:-18pt; font-family:Courier; font-size:12pt" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; padding-right:-36.1pt; font-family:Times New Roman" align=left>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">1.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">it must be substantially with parties at arm&#146;s length to the Corporation;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">2.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">it must not result in control of the Corporation being materially affected;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">3.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">it must be completed within a twelve month period following the date the shareholder approval is given; and</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">4.</font></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><font face="Arial">it must comply with the private placement pricing rules of the TSX which currently require that the issue price per common share must not be lower than the closing market price of the common shares on the TSX on the trading day prior to the date notice of the private placement is given to the TSX (the &quot;Market Price&quot;), less the applicable discount. &nbsp;For these purposes, a private placement of unlisted convertible securities is deemed to be a private placement of the underlying listed securities at an issue price equal to the lowest possible price at which the securities are convertible by the holders thereof.</font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Courier; font-size:12pt" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><font face="Arial">The directors of the Corporation believe the passing of a resolution authorizing the Corporation to enter into private placement transactions for the issuance of up to 75% of the number of common shares outstanding is in the best interests of the Corporation and recommend that shareholders vote in favour of the resolution.</font> </P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><font face="Arial">Approval of the resolution will require the favourable vote of a majority of the votes cast thereon at the Meeting</font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align=left><B><font face="Arial">GENERAL APPROVAL OF CIRCULAR</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:-36pt; font-family:Times New Roman" align="left"><font face="Arial">The contents and sending of this management information circular have been approved by the Board of Directors of the Corporation,</font> </P>
<P style="margin:0pt; font-family:Times New Roman" align="left"><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; text-indent:-36pt; font-family:Times New Roman" align="left"><B><font face="Arial">BY ORDER OF THE BOARD OF DIRECTORS</font></B></P>
<B><P style="margin:0pt; text-indent:270pt; font-family:Times New Roman" align="left"></B><font face="Arial">DATED: &nbsp;March 18th, 2005</font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align="left"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=left><font face="Arial"><BR></font></P>
&nbsp;<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">99</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><U><font face="Arial" size="2">Charter of the Audit Committee of the Board of Directors</font></U></P>
<P style="margin:0pt; font-family:Arial" align=left><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; font-family:Times New Roman" align=left><B><font face="Arial">I.</font></B></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=left><B><font face="Arial">Purpose</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial">The purpose of the Audit Committee (the &#147;Committee&#148;) of the Board of Directors (the &#147;Board&#148;) of Caledonia Mining Corporation (&#147;Caledonia&#148;) is to provide an open avenue of communication between Caledonia&#146;s management (&#147;Management&#148;), the independent auditors (&#147;Auditors&#148;) and the Board and to assist the Board in its oversight of the:</font></P>
<ul>
  <li>
    <p style="margin:0pt; padding-left:18pt; font-family:Symbol" align="left"><font face="Arial">integrity, adequacy and timeliness of &nbsp;Caledonia&#146;s financial reporting and disclosure practices;</font></li>
  <li>
    <p style="margin:0pt; padding-left:18pt; font-family:Symbol" align="left"><font face="Arial">processes for identifying the principal financial risks of &nbsp;Caledonia and the control systems in place to monitor them;</font></li>
  <li>
    <p style="margin:0pt; padding-left:18pt; font-family:Symbol" align="left"><font face="Arial">compliance with legal and regulatory requirements related to financial reporting; and</font></li>
  <li>
    <p style="margin:0pt; padding-left:18pt; font-family:Symbol" align="left"><font face="Arial">independence and performance of &nbsp;Caledonia&#146;s Auditors.</font></li>
</ul>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial">The Committee shall also perform any other activities consistent with this Charter, Caledonia&#146;s by-laws and governing laws as the Committee or Board deems necessary or appropriate.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial">The Committee&#146;s role is one of oversight. It is not the responsibility of the Committee to determine that Caledonia&#146;s financial statements are complete and accurate and in accordance with generally accepted accounting principles or to plan or conduct audits. &nbsp;The financial statements are the responsibility of Management. &nbsp;The Auditors are responsible for performing an audit and expressing an opinion on the fair presentation of Caledonia&#146;s financial statements in accordance with generally accepted accounting principles.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-36pt; font-family:Times New Roman" align=left><B><font face="Arial">&nbsp;II.</font></B></P>
<P style="margin:0pt; padding-left:36pt; font-family:Times New Roman" align=left><B><font face="Arial">Authority</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial">The Committee has the authority to conduct any investigation appropriate to its responsibilities, and it may request the Auditors as well as any officer of Caledonia, or Caledonia&#146;s outside counsel, to attend a meeting of the Committee or to meet with any members of, or consultants to, the Committee. &nbsp;The Committee shall have unrestricted access to Caledonia&#146;s books and records and has the authority to retain, at Caledonia&#146;s expense, special legal, accounting, or other consultants or experts to assist in the performance of the Committee&#146;s duties. &nbsp;Subject to Board approval, the Committee has the authority to set and pay the compensation of the advisors employed by the Committee. The Chairperson of the Committee (&#147;Chairperson&#148;) or other member of the Committee so designated by the Committee may represent the Committee to the extent permitted by applicable legal and listing requirements.</fo
nt></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial">The Committee shall review and assess the adequacy of this Charter annually and submit any proposed revisions to the Board for approval.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left>&nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:28.35pt; text-indent:-28.35pt; font-family:Times New Roman" align=left><B><font face="Arial">III.</font></B></P>
<P style="margin:0pt; padding-left:28.35pt; font-family:Times New Roman" align=left><B><font face="Arial">Composition and Meetings</font></B></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">1.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">The Committee and its membership shall meet all applicable legal, regulatory and listing requirements.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">2.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">Members of the Committee and the Chairperson shall be appointed by the Board and may be removed by the Board in its discretion. The Committee will be elected annually at the first Board meeting following the annual general meeting.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">3.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">The Committee shall be comprised of three or more directors, one of whom shall serve as the Chairperson.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">4.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">Each member of the Committee shall be an independent, non-executive director, free from any relationship that, in the opinion of the Board, could reasonably be expected to interfere with the exercise of his or her independence from management, Caledonia, or the Auditors.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">5.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">All members of the Committee shall be, or promptly after appointment, shall become financially literate as determined by the Board. Preferably at least one member of the Committee shall have accounting or related financial management expertise as determined by the Board.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">6.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">The Committee shall meet, at the discretion of the Chairperson or a majority of its members, as circumstances dictate or as may be required by applicable legal or listing requirements, and a majority of the members of the Committee shall constitute a quorum.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">7.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">If and whenever a vacancy shall exist, the remaining members of the Committee may exercise all of its powers and responsibilities so long as a quorum remains in office.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">8.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">Any matters to be determined by the Committee shall be decided by a majority of votes cast at a meeting of the Committee called for such purpose; actions of the Committee may be taken by an instrument or instruments in writing signed by all of the members of the Committee, and such actions shall be effective as though they had been decided by a majority of votes cast at a meeting of the Committee called for such purpose. In the case of a tie the Chairperson shall have a second or tie-breaking vote.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">9.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">The Committee shall maintain minutes of meetings and periodically report to the Board on significant results of the Committee&#146;s activities.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">10.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">The Committee may invite such other persons to its meetings as it deems appropriate.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial">11. The Auditors will have direct access to the Committee on their own initiative.</font></P>
&nbsp;<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">100</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
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<P style="margin:0pt; line-height:7.55pt; font-family:Times New Roman; font-size:12pt" align=left><font face="Arial"><BR></font></P>
<P style="margin:0pt; padding-left:28.5pt; text-indent:-28.5pt; line-height:7.55pt; font-family:Times New Roman" align="left"><B><font face="Arial">IV. &nbsp;&nbsp;&nbsp;&nbsp;Responsibilities</font></B></P>
<P style="margin-top:5pt; margin-bottom:-12pt; padding-left:36pt; text-indent:-18pt; font-family:Times New Roman" align=left><B><I><font face="Arial">A.</font></I></B></P>
<P style="margin:0pt; padding-left:36pt; text-indent:-4.65pt; font-family:Times New Roman" align=left><B><I><font face="Arial">With Respect to the Interim and Annual Financial Statements, the MD&amp;A, and the AIF</font></I></B></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">1.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">The Committee shall review Caledonia&#146;s interim statements for approval of same prior to their being filed with the appropriate regulatory authorities. &nbsp;The Committee shall review &nbsp;Caledonia&#146;s annual audited financial statements and report thereon to prior to their being filed with the appropriate regulatory authorities. With respect to the annual audited financial statements, the Committee shall discuss significant issues regarding accounting principles,</font> </P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">practices, and judgments of Management with Management and the Auditors as and when the Committee deems it appropriate to do so.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">2.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">The Committee shall review Management&#146;s Discussion and Analysis relating to annual and interim financial statements, the Annual Information Form and any other public disclosure documents that are required to be reviewed by the Committee under any applicable laws prior to their being filed with the appropriate regulatory authorities.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">3.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">The Committee shall review Management&#146;s earnings releases relating to annual and interim financial statements and any other public disclosure documents that are required to be reviewed by the Committee under any applicable laws prior to their being filed with the appropriate regulatory authorities.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">4.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">The Committee shall review the post-audit or management letter containing the recommendations of the Auditors and Management&#146;s response and subsequent follow-up to any identified weaknesses.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">5.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">The Committee shall review the evaluation of internal controls by the Auditors, together with Management&#146;s response.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">6.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">The Committee shall meet no less frequently than annually separately with the Auditors and the Chief Financial Officer to review Caledonia&#146;s accounting practices, internal controls and such other matters as the Committee or Chief Financial Officer deems appropriate.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:45pt; text-indent:-27pt; font-family:Times New Roman" align=left><B><I><font face="Arial">B.</font></I></B></P>
<P style="margin:0pt; padding-left:45pt; font-family:Times New Roman" align=left><B><I><font face="Arial">With Respect to the Auditors</font></I></B></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">1.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">The Auditors are ultimately accountable to the Board of Directors. &nbsp;The Board has the ultimate authority and responsibility to select, evaluate and, where appropriate, replace the Auditors (or nominate the Auditors to be proposed for shareholder approval in any proxy statement).</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">2.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">The Committee shall review the performance of the Auditors.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">3.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">The Committee shall annually recommend to the Board the appointment of
the Auditors, or, as appropriate, the discharge or replacement of the Auditors when circumstances warrant. The Board will set the compensation for the Auditors.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">4.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">The Committee shall be responsible for ensuring that the Auditors submit on a periodic basis to the Committee a formal written statement delineating all relationships between the Auditors and &nbsp;Caledonia. &nbsp;The Committee is responsible for discussing with the Auditors any disclosed relationships or services that may impact the objectivity and independence of the Auditors and for recommending that the Board take appropriate action in response to the Auditor&#146;s report to satisfy itself of the Auditor&#146;s independence.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">5.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">Caledonia considers the core services provided by the Auditors to include the annual audit, tax planning and tax compliance. The Committee shall review any engagements for non-audit services beyond the core services proposed to be provided by the Auditors or any of their affiliates, together with estimated fees, and consider the impact on the independence of the Auditors.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">6.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">The Committee shall review the Auditor&#146;s audit plan, including scope, procedures and timing of the audit.</font></P>
<P style="margin-top:5pt; margin-bottom:-12pt; padding-left:45pt; text-indent:-36pt; font-family:Times New Roman" align=left><B><I><font face="Arial">C.</font></I></B></P>
<P style="margin:0pt; padding-left:45pt; font-family:Times New Roman" align=left><B><I><font face="Arial">Other Committee Responsibilities</font></I></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=left><font face="Arial">The Committee shall perform any other activities consistent with this Charter and governing law, as the Committee or the Board deems necessary or appropriate including:</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">1.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">Establishing and reviewing Caledonia&#146;s procedures for the receipt, retention and treatment of complaints regarding accounting, financial disclosure, internal controls or auditing matters.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">2.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">Establishing and reviewing &nbsp;Caledonia&#146;s procedures for confidential, anonymous submissions by employees regarding questionable accounting, auditing and financial reporting and disclosure matters.</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">3.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">Conducting or authorizing investigations into any matters that the Committee believes is within the scope of its responsibilities.</font> </P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:18pt; text-indent:-18pt; font-family:Times New Roman" align=left><font face="Arial">4.</font></P>
<P style="margin:0pt; padding-left:18pt; font-family:Times New Roman" align=left><font face="Arial">Making inquires of management and the Auditors to identify significant business, political, financial and control risks and exposures and assess the steps management has taken to minimize such risk.</font></P>
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&nbsp;<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">101</font></P>
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<P style="line-height: 18pt; font-family: Times New Roman; font-size: 16pt; border-left-style: double; border-left-color: #000000; border-right-style: double; border-right-color: #000000; border-bottom-style: double; border-bottom-color: #000000; margin: 0pt; padding: 3pt" align=center><B><font face="Arial">EXHIBIT #14c</font></B></P>
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<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">CALEDONIA MINING CORPORATION</font></B></P>
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<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">SCHEDULES</font></B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:16pt" align=justify><font face="Arial"><BR></font></P>
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<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><B>All schedules specified in Article 5-04 of Regulation S-X are considered not to be applicable to Caledonia</B>.</font></P>
<font face="Arial">
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</font>
<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">102</font></P>
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<P style="font-family: Times New Roman; border-left-style: double; border-left-color: #000000; border-right-style: double; border-right-color: #000000; border-top-style: double; border-top-color: #000000; margin: 0pt; padding: 3pt" align=center>&nbsp;</P>
<P style="line-height: 18pt; font-family: Times New Roman; font-size: 16pt; border-left-style: double; border-left-color: #000000; border-right-style: double; border-right-color: #000000; border-bottom-style: double; border-bottom-color: #000000; margin: 0pt; padding: 3pt" align=center><B><font face="Arial">EXHIBIT #14d</font></B></P>
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<P style="margin:0pt; font-family:Times New Roman; font-size:16pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">CALEDONIA MINING CORPORATION</font></B></P>
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<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">MINERAL PROPERTIES (Thousands of $Cdn)</font></B></P>
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<P style="margin:0pt; font-family:Times New Roman; font-size:16pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">The following is a summary of Caledonia&#146;s mineral properties and the capitalized costs as at the 31<SUP>st</SUP> December 2004:</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><B><font face="Arial">Canada:</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:396pt; text-indent:-360pt; font-family:Times New Roman" align=justify><font face="Arial">Nunavut</font></P>
<P style="margin:0pt; padding-left:396pt; text-indent:72pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;$&nbsp;&nbsp;&nbsp;&nbsp;750</font></P>
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<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
<P style="margin:0pt; text-indent:396pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><B><font face="Arial">Africa:</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:324pt; text-indent:-288pt; font-family:Times New Roman" align=justify><B><font face="Arial">South Africa</font></B></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:324pt; text-indent:-112.5pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:324pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;</font></P>
<P style="margin:0pt; padding-left:324pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;7,157 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:324pt; text-indent:-288pt; font-family:Times New Roman" align=justify><B><font face="Arial">Zambia</font></B></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:324pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;</font></P>
<P style="margin:0pt; padding-left:324pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial"><U>&nbsp;1,041</U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
<P style="margin:0pt; text-indent:36pt; font-family:Times New Roman" align=justify><font face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></P>
<P style="margin:0pt; text-indent:396pt; font-family:Times New Roman" align=justify><U><font face="Arial">&nbsp;&nbsp;8,198</font></U></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify>&nbsp;</P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><B><font face="Arial">TOTAL MINERAL PROPERTIES</font></B></P>
<P style="text-indent: 0; font-family: Times New Roman; margin: 0pt" align=justify>&nbsp;</P>
<P style="margin:0pt; text-indent:396pt; font-family:Times New Roman" align=justify>&nbsp;</P>
<P style="margin:0pt; text-indent:396pt; font-family:Times New Roman" align=justify>&nbsp;</P>
<P style="margin:0pt; text-indent:396pt; font-family:Times New Roman" align=justify><B><U><font face="Arial">$8,948</font></U></B></P>
<P style="text-indent: 0; font-family: Times New Roman; margin: 0pt" align=justify>&nbsp;</P>
<P style="text-indent: 0; font-family: Times New Roman; margin: 0pt" align=justify>&nbsp;</P>
<P style="font-family: Times New Roman; text-indent: 0; margin: 0pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">NOTE: &nbsp;The cost of acquisition of mineral properties and all related exploration and development expenditures, less recoveries, are capitalized and carried as an asset to be amortized against income if the property is brought into commercial production or charged to income if the property is, or is to be, abandoned or disposed of.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:16pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:16pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:16pt" align=center><font face="Arial"><BR></font></P>
&nbsp;<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">103</font></P>
<P style="margin:0pt; font-family:Courier; font-size:12pt"><font face="Arial"><BR></font></P>
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<P style="margin:0pt; font-family:Times New Roman; font-size:16pt" align=center>&nbsp;</P>
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<P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=center><font face="Arial"><BR></font></P>
<P style="line-height: 18pt; font-family: Times New Roman; font-size: 16pt; border-left-style: double; border-left-color: #000000; border-right-style: double; border-right-color: #000000; border-top-style: double; border-top-color: #000000; margin: 0pt; padding: 3pt" align=center><B><font face="Arial">EXHIBIT #14e</font></B></P>
<P style="font-family: Times New Roman; font-size: 16pt; border-left-style: double; border-left-color: #000000; border-right-style: double; border-right-color: #000000; border-bottom-style: double; border-bottom-color: #000000; margin: 0pt; padding: 3pt"><font face="Arial"><BR></font></P>
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<P style="margin:0pt; font-family:Times New Roman; font-size:16pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">CALEDONIA MINING CORPORATION</font></B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:16pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:16pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">SUMMARY REPORT BY</font></B></P>
<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">INDEPENDENT QUALIFIED PERSON</font></B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:16pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; text-indent:258.75pt; font-family:Times New Roman; font-size:16pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">BARBROOK MINES LIMITED</font></B></P>
<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">MPUMALANGA PROVINCE, SOUTH AFRICA</font></B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:16pt"><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:16pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">Prepared by Applied Geology Services cc</font> </B></P>
<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">on behalf of</font> </B></P>
<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">Caledonia Mining Corporation</font></B></P>
<P style="margin:0pt; line-height:18pt; font-family:Times New Roman; font-size:16pt" align=center><B><font face="Arial">31st March 2005</font></B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:16pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:16pt" align=center><font face="Arial"><BR></font></P>
<P style="margin:0pt; line-height:14pt; font-family:Garamond; font-size:12pt" align=center><B><font face="Arial">The complete Independent Qualified Person&#146;s Report (dated May 2004)</font></B></P>
<P style="margin:0pt; line-height:14pt; font-family:Garamond; font-size:12pt" align=center><B><font face="Arial">may be viewed on this company&#146;s website.</font></B></P>
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<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">104</font></P>
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<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Garamond; font-size:12pt" align=left><B><font face="Arial">SUMMARY</font></B></P>
<B><P style="margin:0pt; text-indent:324pt; line-height:14pt; font-family:Garamond; font-size:12pt" align=right><font face="Arial">EXHIBIT 14e</font></B></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">Barbrook Mines Ltd holds title to a Mining Authorization covering 2,286 hectare in extent in the Barberton District of South Africa. &nbsp;The Mining Authorization area hosts numerous small gold deposits collectively known as the Barbrook Mine. &nbsp;Mining activities started in the area in 1885 and have continued intermittently since then, culminating in the consolidation of the Barbrook mines in 1975. &nbsp;</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">For a brief period Maid O&#146; the Mist operated the mine before Caledonia Mining Corporation acquired control in 1995. &nbsp;Operations continued until 1997 when low head grades caused by the mass mining methods forced the mine to close pending a re-assessment of the reserves and resources. &nbsp;The mineral resources were re-evaluated in 2001-2 and following a recommendation to commence with trial mining, Caledonia re-started operations in 2002. &nbsp;For the period to December 2004, Barbrook milled 44,175 tonnes at a milled head grade of 4.5 g/t. &nbsp;</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">Barbrook ore bodies are typical Archean gold deposits occurring as near vertical shoots in the Barberton Greenstone Belt which is host to a number of significant gold mines, viz. Sheba, Fairview and Consort mines. &nbsp;The mineralized shoots tend to be vertically continuous in this environment and Barbrook is considered to have potential resources down to 1,000 m below existing levels. &nbsp;Some 60 mineralized structures have been defined by exploration, mainly on-reef development. &nbsp;While many of these are currently uneconomic, a number of large bodies along the Barbrook and Zwartkoppie lines contain substantial mineral resources. &nbsp;French Bob, Victory, Daylight and Taylors are the main bodies of economic interest. &nbsp;</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">The ores are refractory on account of the fine dissemination of gold in sulphides as well as the associated organic carbon. Overall metallurgical recoveries were reported to have been generally less than 50% during 2004. &nbsp;These low metallurgical gold recoveries were reported to have been caused by mechanical breakdowns, the complex refractory ore and preg-robbing free carbon. &nbsp;This is reported to have necessitated a substantial re-engineering of the plant during 2004 and early 2005.</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">Mineral Reserve and Resource estimates have been updated to reflect the situation as at 31 December 2004 based largely on exposures made during the course of the year. &nbsp;Proven and Probable Reserves amount to 236,000 tonnes at 6.0 g/t while Measured and Indicated Resources are estimated at 1,704,000 tonnes at an in situ grade of 4.7 g/t. &nbsp;Relative to the 2003 estimate, Reserves and Resources declined by approximately 3% owing to various factors including depletion, downgrading of certain blocks and loss of old pillars due to dangerous mining conditions. &nbsp;Proven Reserves, however, increased in 2004 as a result of improved definition of mineralized areas exposed by development. &nbsp;Barbrook&#146;s reserves are sufficient to last the mine 24 months at the planned mill throughput rate of 10,000 tonnes per month, during which time ongoing exploration is expected to convert part of the above Resources to Reserves as
 new zones are exposed. &nbsp;</font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial"><BR></font></P>
<P style="margin:0pt; font-family:Times New Roman" align=justify><font face="Arial">Key mining and exploration activities planned for 2005 include the sinking of an incline shaft at French Bob and Taylors to access the next 150 m vertical section of the ore body. &nbsp;The mine plan is to expand the current production of 6,000 tpm to 10,000 tpm by July 2005 while keeping the target head grade at 5.5 g/t.</font></P>
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&nbsp;<P style="margin:0pt; line-height:14pt; font-family:Courier; font-size:12pt" align="center"><font face="Arial">105</font></P>
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`
end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
