Challenges of

Investing in Junior

Mining Companies

and

Sotkamo Silver

1

Life Cycle of Junior Explorer

Exploration and Discovery Feasibility Construction Start Up

Prod.

High Risk -

High Potential

Lowered

risk

Full value

Failure

Possible takeover

Discovery

10-15 years

Speculation Institutional

Investment

Rela

tive V

alu

e

2

REQUIRE PROPER INFORMATION

ETHICS – HONESTY

- The level of the ethics of the Company comes from the entrepreneurs, owners, management and board.

COMPANY'S GOVERNANCE

- The stock exchange rules and legislation obliges.

- Mining Industry Association’s recommendations

INFORMATION AND COMMINUCATION

- Adequate transparency + credibility

- NI 43 101; JORC; FINNMIN; SVEMIN; CIM; NI 43 101 World bank; EQUDOR PRINCPLES; etc…..

2

3

RULES REDUCE RISKS

• Ni 43 101

• JORC CODE

• SVEMIN

• FINNMIN

• CESR

Committee of

European

Securities Regulators

Timo

Lindborg

3

MINERAL ORE

RESOURCES RESERVES

(IN SITU) (MINEABLE)

Increasing level

of geological

knowledge and

confidence

Consideration of economic,

mining, metallurgical,

marketing, and governmental

factors

PROVEN

MEASURED

PROBABLE

INDICATED

INFERRED

JORC or NI43101 CODE

4

Effective implementation of the mining project

The resource model is critical to exploration and mining decisions, since the resource estimate controls financial expectations at each stage.

• Conceptual study

• Pre-feasibility study stage

• Feasibility study stage

• Back to basics – There are no guarantees with new technology.

• Planning for the unforeseeable – do you have plan B or C

• Mining is cyclical - Volatility is the new stability.

• The licence to operate demands better technology and sustainability.

4

5

• Our aim is to undertake our activities responsible, with due

consideration to the environment, the communities and the

social license in which we operate

• We undertake our exploration and mining-activities in a manner

which takes into consideration environmental aspects,

landowners and other interested and affected parties.

• As a one tool among others in order to implement this, we have

formed a Committee to Monitor Environmental and Social

Issues within our activities at Silver Mine. The members come

from both the municipality and the local village associations and

Sotkamo Nature Organization.

Sotkamo Silver´s Sustainable Development Policy

5

6

■ Headquarter is in Stockholm, Sweden. The

Company also has an operations office in Oulu

and a field office in Sotkamo, Finland

■ The primary listing is on the NGM Equity stock

exchange in Stockholm with secondary listing on

the Nasdaq OMX Helsinki

■ Current market capitalization is about € 20 million

■ The Company had € 1.1 million of net cash at the

end of Q3 2013

OVERVIEW OF SOTKAMO SILVER

7

ORE RESERVES AND ESTIMATED MINE ECONOMICS

KEY PROJECT SUMMARY

Ore reserves Ore

tonnage Ag Grade Ag

Proven 1.19 Mt 90.18 g/t 3 442 141 oz

Probable 1.78 Mt 83.40 g/t 4 786 353 oz

Proven and probable ore reserves 2.97 Mt 86.11 g/t 8 228 494 oz

MINE ECONOMICS

Production of payable silver 0.8 million oz Ag per annum and 7.4

million oz Ag over LOM

Operations commencement date Q4 2014

Average operating cash costs € 10.5 / oz Ag over LOM (US$ 13.7)

Required capital expenditure (including

infrastructure) € 30.7 million

Required net financing (including contingency,

working capital and guarantees) € 40 million

8

• EXPERIENCED AND PROVEN MANAGEMENT - WE DELIVER

• LOW TECHNICAL AND GEOLOGICAL RISK

• FORECASTED OPERATING CASH FLOWS ARE STRONG

• JORC RESERVES AND RESOURCES

• ADITIONAL EXPLORATION POTENTIAL (JORC)

BENEFTS TO INVEST IN SOTKAMO SILVER

8

9

PRESS RELEASE 130828

• THE VOLUME OF THE EXPLORATION TARGET IS

MORE THAN 20 M TON MINERAL RESOURCES

• TOTAL 33 M TON (resources + potential)

• THIS INCREASE THE TARGET SUBSTANTIALLY

“The result of this study shows clearly the great potential, which Silver Mine deposit

has towards depth and strike. This increases the potential of the Silver Mine projektet

and our expectations of the deposit quality. I am certain that the Silver Mine will have

much longer life time than the actual reserves shows today.”

Comments Timo Lindborg, CEO 9

10

PRESS RELEASE 131002

• EXCELLENT RESULTS RECEIVED FROM INFILL

DRILLING-PROGRAM

• The best intersections were found in holes TS3 with 7.5 meters Ag (silver) 153 g/t; TS4 with 15 meters

Ag 269 g/t , TS5 with 10.5 meters Ag 304 g/t, and TS6 with 7.5 meters Ag 267 g/t , TS9 with 5.5 meters

Ag 834 g/t

• “The results are excellent and give us an opportunity to revise the mining plan. The

results give additional verifications to our expectations of the deposit´s quality from

the area where we plan to start the mining during the first years productio.”

Comments Timo Lindborg, CEO

10

11

INCREASED POTENTIAL DOWN TO - 2 000 M

Total Mineral Resource (JORC)

13 Mill.t, Ag 60 g/t

Ore Reserve (JORC) 3 Mill.t, Ag 86 g/t

Exploration Target (JORC)

>20 Mill.t, Ag 60 g/t

Drill Intersections R-110: 27.25 m, Ag 92 g/t

R-106: 23.40 m, Ag 148 g/t

Open Pit Mine Decline Planned Decline

2 Km

500 m

12

SENIOR MANAGEMENT HAVE EXTENSIVE MINING

EXPERIENCE IN THE NORDIC REGION

Timo Lindborg – President &

CEO

■ Doctor of Technology, MSc (

Civil Engineering) and BSc

(Geology). Professor at Oulu

University

■ 35 years experience with

mining projects and Nordic

companies

■ Former Chief Executive Officer

of Endomines AB, Endomines

Oy and Kalvinit Oy

■ Extensive experience in silver

and gold mining projects

■ Born 1955

Ilkka Tuokko – Managing

Director Sotkamo Silver Oy

■ MSc in Geology and

mineralogy from Oulu

University

■ More than 30 years

experience in mining projects,

precious metals and

international mining

companies

■ ”Competent Person” status,

according to Australian JORC

and Swedish SveMin

■ Former Group Geology &

Mining Manager of Mondo

Minerals B.V.

■ Born 1950

pic

13

BOARD OF DIRECTORS HAVE EXTENSIVE MINING

EXPERIENCE IN THE NORDIC REGION

Mauri Visuri – Chairman of the Board (since

2011)

■ MSc in Economics from the University Of

Vaasa

■ Bachelor of Science in Machinery

Engineering from Vaasa Polytechnic

■ Extensive experience in mining and process

industry

■ Mr. Visuri is also Managing Director of

Teknoventure Oy

■ Born 1957

Teuvo Jurvansuu – Board member

(since 2010)

■ 35 years experience in the mining

industry

■ Worked in various mines in Finland

during that period including Vihanti,

Keretti, Enonkoski and Pyhäsalmi

mines

■ In 2001 he entered the position of

Managing Director of Pyhäsalmi Mine

Oy and at the same time, Inmet

Finland Oy (retired in 2009)

■ Born 1948

Joanna Kuntonen-van ‘t Riet – Board

member (since 2012)

■ MSc in Environmental Sciences from the

University of Helsinki

■ Over 13 years experience in

environmental and safety management

in the mining industry

■ Presently Environmental and Safety

Manager at Northland Resources

■ Born 1974

Jarmo Vesanto – Board member

(since March 2013)

■ MSc (Geology and Mineralogy)

■ Member of the Australian Institute of

Mining and Metallurgy

■ More than 30 years experience in

mining and exploration including 10

years in Australia and Canada with

Outokumpu Oyj

■ Currently General Manager - Finland

at Altona Mining Ltd

■ Born 1954

14

Existing Mine Decline (brown)

Planned extension of the decline (green)

Backfill with waste rock

Open pit

Existing ventilation shaft

Year Colour

2014 Green, Brown

2015 Red

2016 Yellow

2017 Blue

2018 Black

2019 – 2021 Grey

RAMP-UP PHASE WILL BENEFIT SIGNIFICANTLY FROM THE EXISTING WORK

Mining plan

■ The existing mine

decline of 2.6 km

and ramp access

(25 m2) , as well as

the vertical

ventilation shaft

extending 350

meters from the

surface, in place

and ready for

operational use.

■ The projected mine

life is 9 to 10 years

based on current

estimated mineable

ore reserves of

approximately 3.0Mt

15

Top five shareholders

%

ownership

Market value

(EUR’m)

Teknoventure Oy 14.2 3.5

Finnish Industry Investments Ltd 14.2 3.5

Timo Lindborg (through a company) 10.2 2.5

Jouko Jylänki 8.9 2.2

Ilmarinen Mutual Pension Insurance

Company

8.5 2.1

Total top five shareholders 56.0 13.9

Other shareholders 44.0 10.9

Total 100% 24.8

REPUTABLE KEY SHAREHOLDERS WITH EXTENSIVE

EXPERIENCE IN MINING SECTOR INVESTMENTS

16

FURTHER EXPLORATION POTENTIAL

■ Exploration projects ongoing in

the surrounding Silver Mine

region, with claims made on

plots covering over 3,000

hectares in the Tipasjärvi

greenstone belt

■ The map illustrates locations of

the applied claims (previous

Mining Act) and ore exploration

permit applications

■ Additional prospects include

Hopeavuori (Vammala Migmatite

Zone) in Southern Finland.

Management believe there is significant

potential in these zones

17

Short

timeframe to

production

■Operations are expected to commence in Q1 2015 and

negotiations with potential off-takers are in advanced stages

■All necessary mining licenses and environmental permits

received

Completed

Bankable

Feasibility

Study (BFS)

■Extensive exploration and technical mine planning completed,

including a BFS prepared by Wardell Armstrong in May 2012

■Review of the final mining plan completed by Outotec in May

2012

Production

■Average silver production of 0.8 million oz Ag per annum.

■Silver : 7,386,148 oz; Gold : 23,166 oz (LOM)

■Zinc : 17,468 t; Lead : 7,564 t (LOM)

Low capital

expenditure

■Capital expenditure of approximately € 30.7m required, which

includes construction of a processing plant and infrastructure

■Contract negotiations are near complete with all suppliers

KEY INVESTMENT HIGHLIGHTS

18

Low risk

mining and

processing

■Deposit mineralogy is simple, well understood and easy to

process, with standard grinding and flotation with recovery above

86%.

Significant

growth

potential

■Geophysical surveys suggest substantial extension to potential

mine life and resource mineralization.

■Exploration mineral resource estimate in the inferred category (NI

43-101 compliant) is 13 Mt of ore for 26 Moz silver at 65g/t (cut-

off grade 30 g/t Ag) + the Exploration target is 20 Mt at 60g/t.

■Substantial pipeline of promising exploration projects in the

surrounding Silver Mine region.

Management

team with

proven track

records

■The management team has wide experience of running mines in

Finland. Both CEO Timo Lindborg and Managing Director Ilkka

Tuokko are experienced mining professionals with a proven track

record of exploration and production.

Environment ■Equator Principles Assessment received with no significant

issues noted.

LOW RISK AND SIGNIFICANT GROWTH POTENTIAL

19

SILVER MINE AREA

THE NECESSARY MINING LICENSE

AND

ENVIRONMENTAL PERMIT RECEIVED

20