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  • 1. Rare Earth Elements Unique Ownership in Strategic Metals Corporate Presentation May 7th 2010 TSX:DAC OTCQX:DHCAF A Forbes & Manhattan Group Company
  • 2. Forward Looking Statements Caution regarding forward-looking information: This presentation contains "forward looking information" within the meaning of applicable Canadian securities legislation. Forward looking information includes without limitation, statements regarding the proposed use of the proceeds of the financing, the receipt of all necessary approvals, the issue of permits, progress in development of mineral properties, future production and sales volumes, capital and mine production costs, demand and market outlook for rare earth metals, future metal prices and treatment and refining charges, the financial results of the Company, the future financial or operating performance of the Company, and terms and the availability and likelihood of future acquisitions. Generally, forward looking information can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including but not limited to: general business, economic, competitive, geopolitical and social uncertainties; market risks; risks related to leverage; acquisition risks; and other risks of the mining and trading industries. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws. This presentation does not constitute an offer to sell or a solicitation of an offer to sell any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available. 2
  • 3. Direct Access to a Strategic Stockpile of Rare Earths A diversified portfolio of physical inventory Key individuals with industry experience and contacts Physical inventory stored outside of China 3
  • 4. Attractive Value Proposition for Investors Participate in the expected price appreciation of rare earths and strategic industrial commodities Early stage investment in a potentially valuable industrial commodities trading operation Unique structure that can earn a substantial market premium 4
  • 5. Capital Structure Capital Structure Key Institutional Shareholders Stock symbol: DAC – TSX:V Libra Fund LP Shares issued: 71.5 M* Aberdeen International Inc Fully diluted: 92.5 M Sprott Asset Management Price (03/30/10): $0.77 Market Cap: $55 M Dundee 52-week High/Low: $1.05-$0.39 AGF Cash: $22 M RAB Capital Latest Financing(Mar 2010) Amount Raised: $22.0 M Special W’ts issued**: 48.9 M Price: $0.45 * Includes special warrants ** Special warrants convert to one common share on the earlier of clearing by prospectus or July 25-2010 5
  • 6. Management Stan Bharti, P.Eng., Executive Chairman • More than 25 years experience in business, management, operations, public markets, and finance • Mr. Bharti has been the President of Forbes & Manhattan, Inc., a private merchant bank operating in Canada, the United States and Western Europe, since July 2001 • He is the Chairman and Director of many other publicly listed junior mining companies Scott Moore, MBA, President & Chief Executive Officer • Mr. Moore is an experienced capital markets executive with 20 years experience in the resource and durable goods sector • Former CEO of Franc-Or Resources Corp and VP Corporate Development for Aberdeen International. Former Director of Sulliden Gold, Franc Or Resources and Avion Gold. He ahs raised in excess of $250 million in resources in the last 3 years. • He holds a Bachelor of Arts degree from the University of Toronto and an MBA from the Kellogg School of Management Alastair Neill, P.Eng., MBA, Executive Vice-President • Mr. Neill is the former VP sales, Rare Earth Division and VP Business Development for AMR (Now Neo-Material Technologies) and brings over 15 years of direct Rare Earth experience • He holds a MBA from York University and a Bachelor of Engineering in Material Science from the University of Western Ontario Patrick Wong, Chief Investment Officer • Mr. Wong is a seasoned hedge fund manager with over 15 years of experience and a consistent track record of high returns • During his career in the public markets, Mr. Wong ran proprietary trading desks at various brokerage firms Brad Boland, C.M.A., Chief Financial Officer • Mr. Boland was the CFO of Consolidated Thompson Iron Mines Limited until July 2009 • From May 2005 to September 2007, he was at Kinross Gold Corp., most recently serving in the position of Vice President, Corporate Controller • Prior to that, from August 1998 to February 2005, Mr. Boland was at Goldcorp Inc., as Corporate Controller and the Vice President, Finance 6
  • 7. Why invest in Dacha • Growing Demand for REE • Limited Supply to satisfy growth • Strategic Stockpile outside China • No Mining Risk • Dynamic Physical Portfolio • Industry Veterans 7
  • 8. Industrial Minerals are the Enablers of Modern Technology 8
  • 9. “Biggest User of Rare Earths of any Object in the World” Toyota Prius  1kg Neodymium  15kg Lanthanum  0.1kg Dysprosium  Top-selling car in Japan “In 20 years, all cars on the road will be electric”- Warren Buffett, November 2009 9
  • 10. The Largest User of Rare Earths Tomorrow 1mt Neodymium needed for every 3 MW of wind power generated 10
  • 11. “The value of global rare-earth trade last year was just $1.25 billion, and it is projected to grow to about $3 billion by 2015.”- The Wall Street Journal September 3rd, 2009 China – Guarding The Supply • +95% of Global Supply • Export Tariffs to drive manufacturing to China • Export Quotas to limit material available to the Rest of World 11
  • 12. Rare Earth Stocks React Relative Price Performance Avalon 600% 500% Arafura Resources 400% Rare Element 300% Lynas 200% Great Western Minerals 100% Rare Earth Elements Index 0% TSX Composite -100% Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 •Quest Uranium Corp. was left out due to a return of over 6000% As at January 15, 2010 Source: BloombergZ 12
  • 13. Strong Demand Growth IMCOA Rare Earth Oxide Forecast 250,000 200,000 Demand tpa - REO 150,000 100,000 50,000 - 2004 2005 2006 2007 2008 2009 2010f 2011f 2012f 2013f 2014f China Supply ROW Supply Global Demand China Demand Global Demand China Demand (Exclusive of China) ROW: rest of word supply (yet to come on stream) REO: Rare Earth Oxides Source: IMCOA 13
  • 14. Current State of the Rare Earth Markets  Small number of market participants  Transactional based market  Contracts represent the bulk of market volumes  Conflicts between business models Dacha believes the market for Rare Earths is relatively inefficient and mispriced 14
  • 15. An Actively Managed Physical Portfolio Fundamental Research Asset Allocation Dynamic Physical Portfolio of Rare Earths + Trading Operations Corporate not Hedge Fund Structure First Mover Advantage 15
  • 16. London Metal Exchange Approved Warehouses Dacha’s LME Warehouse Locations Dacha will hold it’s physical inventory initially in Korea and Singapore 16
  • 17. Upside Potential Rising Commodity Prices For Rare Earth in next 3yrs Growing recognition with broader investor base and market transference of strategic premium Upcoming news flow from the industry, updates on Dacha’s transactions, further corporate development Non-dilutive nature of equity financings builds critical mass for takeout potential Diversification into other strategic metals 17
  • 18. Valuation Based On NAV Plus Premium NAV of Physical Portfolio + Scarcity of Rare Earths + Financial Products + = PREMIUM TO NAV Dynamic Trading Strategy + Only Financial Player 18
  • 19. Dacha Capital A Forbes & Manhattan Group Company Forbes & Manhattan A Private Merchant Bank Dacha Capital Inc. Management Team Stan Bharti Scott Moore Alastair Neill Patrick Wong Brad Boland Executive Chairman President and CEO Executive VP CIO CFO Board of Directors Jean-Guy Claude Stan Bharti Scott Moore Alastair Neill George Faught Labert Blanchet Strategic Metal Advisory Board Dr. Allen Alper Zheng Zhi Alastair Neill Don Bubar 19
  • 20. Dacha Capital A Forbes & Manhattan Group Company Forbes & Manhattan Forbes FINANCIAL GROUP Forbes AGRICULTURAL ForbesENERGY GROUP Forbes MINERALS GROUP GROUP Forbes Forbes STEEL PRECIOUS AND AND SPECIALTY BASE METALS MINERALS GROUP GROUP China Mining United Fund 20
  • 21. Forbes & Manhattan Proven Track Record Price Per Share and Returns >$7.00 $5.00 $8.00 $10-$12 >$7.00 $2.20 $0.20 $0.20 $0.22 $0.22 $0.86 $0.20 Cost Cost Exit Exit Cost Cost Market Market Cost Market (Oct ‘09) Cost Exited 2007 • 3,750% return in 4 years • Over 3,900% return over • 1,100% return over • Sold to Yamana Gold 4 years 9 months for $735M • Market cap over C$1 B • Market cap $C335 M 21
  • 22. Strategic Metal Advisory Board Management will be assisted by the Advisory Board consisting of Alistair Neill, Executive Vice President of Dacha Capital, Dr. Allen Alper, former General Manager of Osram Sylvania and Zheng Zhi, Chairman of the Beijing based China Mining United Fund Dr. Allen Alper • Accomplished senior executive, 30 year career at Osram Sylvania • Formerly VP and General Manager Osram Chemical/Metallurgical Division (15 years) • Expert in manufacturing and marketing of Tungsten, Molybdenum and other strategic metals • Holder of 33 patents in high temperature metals Zheng Zhi • Chairman of China Mining United Fund (www.cmufund.com) • He graduated from Jilin University majoring in corporate management in 1987, and completed his graduate studies from Tsinghua University in the class of mining finance • Mr. Zheng is also acting as the board director for the Zhengda Group, which controls about 10 billion RMB in assets Don Bubar • Mr Bubar is CEO Avalon Rare Metals and has been a leader in promoting the growth of Rare Earth Deposits outside of China. 22
  • 23. Appendix
  • 24. Board Of Directors Stan Bharti, P.Eng., Executive Chairman Scott Moore, MBA, President & Chief Executive Officer and Director Alastair Neill, Executive Vice-President and Director Jean-Guy Lambert, MBA, Vice chairman • Mr. Lambert served as President and CEO of Dacha Capital Inc. since 1996 • He has served as a financial advisor for Hydro-Quebec as well as a pension fund investment manager and Vice President for major financial institutions • He sits on the boards of several public companies and is involved in the management of many private companies Claude Blanchet, MBA, Director • Mr. Blanchet was President of Overload Financial Inc., a Calgary-based corporation, managing energy-related investment funds • He was the Chairman and CEO of Societe Generale de Financement du Quebec (SGF) from April 1997 to May 2003, and CEO of the Fonds de Solidarite des travailleurs du Quebec (F.T.Q.), from November 1983 to March 1997 • Throughout his career, Mr. Blanchet has acted as director of many public companies such as Cascades Inc. (TSX), Domtar Inc. (TSX) and Saputo Inc. (TSX). He’s currently a Director of Demcap Investments Inc. (TSX-V) George Faught, CA, Director • Mr. Faught is a chartered accountant with over 25 years of senior management experience. Currently he is the CEO of Aberdeen International Inc. and has served as the Chief Financial Officer of publicly traded companies in the natural resources including North American Palladium Ltd., a mid-tier platinum group metal producer. Prior to that, he served as Chief Financial Officer for Hudson Bay Mining & Smelting Co. Ltd., an integrated base metals producer, and William Resources Inc., an international gold producer. Mr. Faught also serves as a director of several public companies in the resource sector. 24
  • 25. Forbes International Advisory Board General Jay Garner, USA General Larry Gillespie Served in the U.S. military for 35 years, including Highly decorated, including Distinguished Flying Cross, command of Air Missile Defence Units in the Gulf War Soldier’s Medal and Meritorious Service Medal General Ron Hite, USA General Sir Michael Rose, U.K. Served 33 years in the U.S. military, culminating as Senior Former SAS Commander for the British Army and a highly Military Advisor to the Army Chief of Staff decorated General General Chuck Wald, USA Hon. Pierre Pettigrew, Canada Air Force, Deputy Commander, European Command Served as Canadian federal Minister of Foreign Affairs including Africa Hon. Brian V. Tobin, Canada General George Joulwan Served as the Canadian federal Minister of Industry and US Army, Former Supreme Allied Commander, Europe Premier of Newfoundland / Labrador General Tony Zinni General Lewis MacKenzie, Canada US Marines, Former Commander in Chief of US Central Served in the Canadian Forces for 36 years; led the UN Command – includes all Middle Eastern Countries peacekeeping mission in Sarajevo 25
  • 26. The Periodic Table of The Elements Lanthanides Actinides 26
  • 27. Rare Earth Ore Compositions Rare earth content of major source minerals (% total REO) Monazite Apatite Loparite Bastnaesite Ion Adsorption Clays Longnan, Nangang, Nolan's Baiyun Obo, Mountain Pass, Xunwu, Jiangxi Jiangxi Mt Weld, Guangdong, Guangdong, Bore Lovozersky, Mongolia, California, Guangdong, Province, Province, Austrailia China China Australia Russia China USA China China China Lanthanum 25.50 24.00 23.00 20.40 28.00 25.00 33.20 30.40 43.40 1.82 Cerium 46.74 42.70 42.70 48.32 57.50 50.00 49.10 1.90 2.40 0.40 Praseodymium 5.32 4.10 4.10 5.91 3.80 5.10 4.30 6.60 9.00 0.70 Neodymium 18.50 17.00 17.00 21.06 8.80 16.70 12.00 24.40 31.70 3.00 Samarium 2.27 3.00 3.00 2.37 0.96 1.20 0.80 5.20 3.90 2.80 Europium 0.44 0.10 0.10 0.37 0.13 0.20 0.12 0.70 0.50 0.10 Gadolinium Trace 2.00 2.00 0.95 0.21 0.70 0.17 4.80 3.00 6.90 Terbium 0.07 0.70 0.70 0.08 0.07 Trace Trace 0.60 Trace 1.30 Dysprosium 0.12 0.80 0.80 0.34 0.09 Trace Trace 3.60 Trace 6.70 Holmium Trace Trace 0.12 0.05 0.03 Trace Trace Trace Trace 1.60 Erbium 0.03 0.30 0.30 0.09 0.07 Trace Trace 1.80 Trace 4.90 Thulium Trace Trace 0.01 Trace Trace Trace Trace Trace 0.70 Yttrium 0.06 2.70 2.40 0.05 0.29 Trace Trace Trace 0.30 2.50 Lutetium Trace 0.14 0.01 0.05 Trace Trace Trace 0.10 0.40 Yttrium 0.35 2.60 2.40 1.48 Trace 0.20 2.60 20.00 8.00 65.00 Total 99.98 100.00 98.76 101.49 100.00 100.00 99.79 100.00 102.30 98.82 Source: US Geological Survey and Company Reports 27
  • 28. TSX:DAC OTCQX:DHCAF China Office Toronto Office Floor 5, South Building G. Scott Moore 65 Queen St west, Suite 800 Zhonghai Mansion President and CEO Toronto, Ontario Jianguomenwai Street Tel: 416-861-5903 M5h 2M5 Beijing, China smoore@dachacapital.com 1000020