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December12,2011 TotheManagementandBoardofDirectorsofMonumentMiningLimited: I have been a strong supporter of the management of both Monument Mining and YukonNevada Gold Corporation.However,withthemostrecentplansabouttheMengapurPolymetallicProjectinMalaysia,Ibecame more confused and doubtful about the managements ability to allocate capital for the benefit of shareholders. MaybethereissomethingthatIammissing;pleasehelpmeunderstandyourrationale. Themanagementstatesthatafterextensiveanalysisanddiscussions,theacquisitionoftheMengapurprojectisin the best interest of the company and its shareholders. Based on my own analysis by using the confusing informationthathasbeenprovidedbytheNI43101,IhaveahardtimeseeinghowtheMengapurprojectcreates valueforshareholders. Themanagementisaskingitsshareholderstovoteandsupportthisproject.BasedontheanalysisthatIamabout topresent,Ihavenoideawhyanyshareholderintheirrightmindwouldvoteyesforthisproject.Atthispoint, themanagementscommunicationsarenotgivingshareholdersanyreasontosupportit. In the current state, Monument Mining is awash in cash. The gold production is generating approximately $70 milliononanannualizedbasis.Asofthedateofthisletter,thecompanyprobablyhasanother$70millioninthe bank.Within12monthsorless,thecompanywillbeproducinggoldatanannualizedrateof100,000ouncesof goldperyear,whichwillgeneratecashflowsofapproximately$140million,basedonthecurrentpriceofgold.On afullydilutedbasis,thistranslatesinto$0.43pershare.ThestockofMonumentdoesnoteventradeatthisprice. Instead of waiting and realizing this tremendous potential, the management is choosing to engage in the Mengapurproject.BasedonthemostrecentNI43101,thisprojectisestimatedtobringrevenuesof$100million withcashflowsofapproximately$40million.Tobringthisprojectintoproduction,itwillcostapproximately$179 million. I understand that these projections are based on outdated numbers, and therefore, are understated. Whentheestimatesarebroughtuptodate,thisprojectshouldyieldapproximately$300millionofrevenuesper year.Ifwekeepmarginsthesame,thisshouldtranslateinto$120millionincashflows.BecauseMonumentwill onlyown70percentoftheproject,thecompanysportionwillbe$84millionincashflowsperyear. Atfirstglance,thissoundsterrific,butwhatwillitcostustogetthesejuicybenefits?Atfirst,thecompanywillbe paying$60millionfortheoriginalacquisition.Tothemanagement,thispricetagmayseemreasonable,butfor shareholders,itismuchhigher.Wearenotpaying$60millionbecausewearepayingwithundervaluedshares, whichareworthatleastfourtimesthecurrenttradingprice.Thismeansthatwearereallypaying$240millionfor theacquisitionoftheMengapurproject.However,itdoesnotendthere.Wealsoknowthatitwillcostatleast $179milliontobringitintoproduction.Isayatleastbecausetheconstructioncostsarealsobasedonoutdated numbers.Today,itwillprobablycostapproximately$350million,andtherefore,thetotalcostwillbe$590million oroverhalfabilliondollars.

AsImentionedbefore,atfirst,getting$84millionincashflowslooksgreat,butafterrealizingthatwearegiving up over half a billion dollars of value to get it, it does not excite me anymore. Assuming that the project is successful,howwillthistranslateintocashflowspershare? Currently,thereare321millionfullydilutedshares.Becausethemanagementisplanningtoissueanadditional 140millioncommonsharesand140millionwarrants,thenewlydilutedshareswillbe601million.Thetotalcash flowsfrombothprojectswillbeapproximately$228million.Iamassuminggoldproductionof100,000ouncesper yearand$84millionfromtheMengapurproject.Thisgivesmecashflowpershareof$0.38. Previously, I calculated that without the Mengapur project, we will get cash flow per share of $0.43 after the companyproduces100,000ouncesofgoldperyear.Letsnotforgetthatbythattime,thecompanywillprobably have$150millioninthebank.Now,themanagementisaskingustoapproveadealthatrequiresgivingupover halfabilliondollarsworthofvaluesothatwecanget$0.38ofcashflowpershareinthedistantfuture.Howisthis agooddeal?Wearebeingaskedtoapprovesomethingthatisrisky(eventhemanagementcalleditchallenging) yetitdoesnotdeliveranyincrementalvaluepershare.Asamatteroffact,wearebeingguaranteedthatthatthe valuepersharewillbelesswiththeMengapurprojectthanwithout.Idontevenwanttothinkabouthowmuch valuewillbedestroyediftheprojectturnsouttobeafailure. IhavebeencontactedbyseveralMonumentshareholderswhoaresimilarlyconfusedandsomeofthemwentso far as to conclude that the Mengapur project is not supposed to benefit shareholders but the companys managementbecausewhenthecompanygrowsinsize,itwillbeabletopayhighersalariesandotherbenefits. AfterspeakingwithBobBaldock,theCEOofMonument,onnumerousoccasions,Ihaveahardtimebelievingthat hisintentionsaretohurtshareholdersforthesakeofbenefitinghisownbestinterests.However,basedonthe informationthatisavailabletothepublic,IcannotseetherationalebehindtheMengapurproject.Growingforthe sake ofgrowing does notbenefit shareholders. What benefits shareholders is allocatingcapital appropriately so thattheintrinsicvaluepershareisgrowing. Atthispoint,IdonotknowwhyanybodyotherthanthemanagementshouldvoteyesfortheMengapurproject. Pleasehelpmeunderstandwhyyouaretryingtodothisdeal.TellmewhyIshouldvotetosupportit.Ifthereisno additionalvaluecreatedonapersharebasis,Iurgethemanagementtoconsideroneofthefollowingoptions: Ceasepursuingtheacquisition Purchaseitwithexistingcashanddevelopitoverthenumberofyearswithcashflowsfromoperations Purchaseitwithexistingcashandthenmakeadecisioninfutureyearsonwhethersellingtheprojector developingitmakesthemosteconomicsenseforshareholders Sincerely, MariuszSkonieczny President ClassicValueInvestors