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TAWANA RESOURCES NL - Notice of General Meeting

Release Date: 07/11/2013 14:00:00      Code(s): TAW       PDF(s):  
Notice of General Meeting

 Tawana Resources NL
 Incorporated in Australia)
 Registration number ACN 085 166 721)
 Share code on the JSE Limited: TAW
 ISIN: AU000000TAW7
 Share code on the Australian Stock Exchange Limited: TAW
 ISIN: AU000000TAW7
 (“Tawana” or “the Company”)


Tawana Resources NL
ACN 085 166 721

Notice of General Meeting

General Meeting of Shareholders to be held at
Freemasons Hall, 181 Roberts Road, Subiaco, Western
Australia at 9:00am (WST) on 12 December 2013.


Important
This Notice of General Meeting should be read in its entirety. If Shareholders are in doubt as to
how to vote, they should seek advice from their professional adviser prior to voting.

Notice of General Meeting
Notice is given that the General Meeting of Shareholders of Tawana Resources NL ACN 085 166
721 (Company) will be held at Freemasons Hall, 181 Roberts Road, Subiaco, Western Australia
commencing at 9:00am (WST) on 12 December 2013.

Business
1.    Resolution 1 – Issue of Performance Options to Wayne Richards
      To consider and, if thought fit, pass the following resolution as an ordinary resolution:

              “That for the purposes of section 208 of the Corporations Act and Listing Rule 10.11,
              and for all other purposes, approval be given for the issue of 10,000,000 Class A
              Performance Options, 10,000,000 Class B Performance Options and 10,000,000 Class
              C Performance Options to Wayne Richards or his nominee in accordance with his
              employment agreement with the Company, as set out in the Explanatory Statement.”

      Voting exclusion
      The Company will disregard any votes cast on Resolution 1 by Wayne Richards and any of his associates.
      However, the Company will not disregard a vote if:
      (a)       it is cast by the person as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form;
                or
      (b)       it is cast by the Chairman as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy
                Form to vote as the proxy decides.


2.    Resolution 2 – Issue of Class A Incentive Options to Wayne Richards
      To consider and, if thought fit, pass the following resolution as an ordinary resolution:

              “That for the purposes of section 208 of the Corporations Act and Listing Rule 10.11,
              and for all other purposes, approval be given for the issue of 25,000,000 Class A
              Incentive Options to Wayne Richards (and/or his nominee) in accordance his
              employment agreement with the Company, as set out in the Explanatory Statement.”

      Voting exclusion
      The Company will disregard any votes cast on Resolution 2 by Wayne Richards and any of his associates.
      However, the Company will not disregard a vote if:
      (a)       it is cast by the person as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form;
                or
      (b)       it is cast by the Chairman as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy
                Form to vote as the proxy decides.




3.    Resolution 3 – Issue of Class B Incentive Options to Lennard Kolff van Oosterwijk
      To consider and, if thought fit, pass the following resolution as an ordinary resolution:

              “That, for the purposes of section 208 of the Corporations Act and Listing Rule 10.11,
              and for all other purposes, approval be given for the issue of 10,000,000 Class B
              Incentive Options to Lennard Kolff van Oosterwijk (and/or his nominee), as set out in
              the Explanatory Statement.”

     Voting exclusion
     The Company will disregard any votes cast on Resolution 3 by Lennard Kolff van Oosterwijk and any of his associates.
     However, the Company will not disregard a vote if:
     (a)       it is cast by the person as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form;
               or
     (b)       it is cast by the Chairman as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy
               Form to vote as the proxy decides.




4.   Resolution 4 – Issue of Class A Incentive Options to Matthew Bowles
     To consider and, if thought fit, pass the following resolution as an ordinary resolution:

             “That, for the purposes of section 208 of the Corporations Act and Listing Rule 10.11,
             and for all other purposes, approval be given for the issue of 3,500,000 Class A
             Incentive Options to Matthew Bowles (and/or his nominee), as set out in the
             Explanatory Statement.”

     Voting exclusion
     The Company will disregard any votes cast on Resolution 4 by Matthew Bowles and any of his associates.
     However, the Company will not disregard a vote if:
     (a)       it is cast by the person as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form;
               or
     (b)       it is cast by the Chairman as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy
               Form to vote as the proxy decides.


5.   Resolution 5 – Issue of Class A Incentive Options to Aaron Finlay
     To consider and, if thought fit, pass the following resolution as an ordinary resolution:

             “That, for the purposes of Listing Rule 7.1, and for all other purposes, approval be
             given for the issue of 750,000 Class A Incentive Options to Aaron Finlay (and/or his
             nominee), as set out in the Explanatory Statement.”

     Voting exclusion
     The Company will disregard any votes cast on Resolution 5 by Aaron Finlay and any of his associates.
     However, the Company will not disregard a vote if:
     (a)       it is cast by the person as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form;
               or
     (b)       it is cast by the Chairman as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy
               Form to vote as the proxy decides.




6.   Resolution 6 – Issue of Class A Incentive Options to Winton Willesee
     To consider and, if thought fit, pass the following resolution as an ordinary resolution:

             “That, for the purposes of Listing Rule 7.1, and for all other purposes, approval be
             given for the issue of 750,000 Class A Incentive Options to Winton Willesee (and/or his
             nominee), as set out in the Explanatory Statement.”

     Voting exclusion
     The Company will disregard any votes cast on Resolution 6 by Winton Willesee and any of his associates.
     However, the Company will not disregard a vote if:


     (a)       it is cast by the person as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form;
               or
     (b)       it is cast by the Chairman as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy
               Form to vote as the proxy decides.

7.   Resolution 7 – Issue of Class A Incentive Options to Rockson Coffie
     To consider and, if thought fit, pass the following resolution as an ordinary resolution:

             “That, for the purposes of Listing Rule 7.1, and for all other purposes, approval be
             given for the issue of 1,500,000 Class A Incentive Options to Rockson Coffie (and/or
             his nominee), as set out in the Explanatory Statement.”

     Voting exclusion
     The Company will disregard any votes cast on Resolution 7 by Rockson Coffie and any of his associates.
     However, the Company will not disregard a vote if:
     (a)       it is cast by the person as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form;
               or
     (b)       it is cast by the Chairman as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy
               Form to vote as the proxy decides.


8.   Resolution 8 – Ratification of prior issue of Shares under the Placement
     To consider and, if thought fit, pass the following resolution as an ordinary resolution:

             “That, for the purpose of Listing Rule 7.4 and for all other purposes, the issue of
             244,000,000 Shares to Exempt Investors under the Placement as set out in the
             Explanatory Statement is hereby approved and ratified.”

     Voting exclusion
     The Company will disregard any votes cast on Resolution 8 by a person who participated in the Placement and any of its associates.
     However, the Company will not disregard a vote if:
     (a)       it is cast by the person as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form;
               or
     (b)       it is cast by the Chairman as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy
               Form to vote as the proxy decides.

9.   Resolution 9 – Issue of Shares to Wayne Richards
     To consider and, if thought fit, pass the following resolution as an ordinary resolution:

             “That, for the purposes of section 208 of the Corporations Act and Listing Rule 10.11,
             and for all other purposes, approval be given for the issue of 5,000,000 Shares to
             Wayne Richards (and/or his nominee) at an issue price of $0.012 each, as set out in
             the Explanatory Statement.”

     Voting exclusion
     The Company will disregard any votes cast on Resolution 9 by Wayne Richards and any of his associates.
     However, the Company will not disregard a vote if:
     (a)       it is cast by the person as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form;
               or
     (b)       it is cast by the Chairman as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy
               Form to vote as the proxy decides.

                                                        4
10.   Resolution 10 – Issue of Placement Options to Canaccord Genuity (Australia) Limited
      To consider and, if thought fit, pass the following resolution as an ordinary resolution:

              “That, for the purposes of Listing Rule 7.1, and for all other purposes, approval be
              given for the issue of 10,000,000 Placement Options to Canaccord Genuity (Australia)
              Limited (and/or its nominee) in accordance with the Lead Manager Mandate, as set out
              in the Explanatory Statement.”

      Voting exclusion
      The Company will disregard any votes cast on Resolution 10 by Canaccord Genuity (Australia) Limited and any of his associates.
      However, the Company will not disregard a vote if:
      (a)       it is cast by the person as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form;
                or
      (b)       it is cast by the Chairman as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy
                Form to vote as the proxy decides.




By order of the Board



__________________________
Winton Willesee
Joint Company Secretary
Tawana Resources NL


4 November 2013




                                                       
Explanatory Statement
This Explanatory Statement has been prepared for the information of Shareholders in relation to the
business to be conducted at the Company’s General Meeting.

The purpose of this Explanatory Statement is to provide Shareholders with all information known to
the Company which is material to a decision on how to vote on the Resolutions in the accompanying
Notice.

This Explanatory Statement should be read in conjunction with the Notice. Capitalised terms used
in the Notice and Explanatory Statement are defined in the Glossary.

1.     Proxies
       Please note that:

       (a)    a Shareholder entitled to attend and vote at the General Meeting is entitled to appoint
              a proxy;

       (b)    a proxy need not be a member of the Company;

       (c)    a Shareholder may appoint a body corporate or an individual as its proxy;

       (d)    a body corporate appointed as a Shareholder’s proxy may appoint an individual as its
              representative to exercise any of the powers that the body may exercise as the
              Shareholder’s proxy; and

       (e)    Shareholders entitled to cast two or more votes may appoint two proxies and may
              specify the proportion or number of votes each proxy is appointed to exercise, but
              where the proportion or number is not specified, each proxy may exercise half of the
              votes.

       The enclosed Proxy Form provides further details on appointing proxies and lodging Proxy
       Forms. If a Shareholder appoints a body corporate as its proxy and the body corporate
       wishes to appoint an individual as its representative, the body corporate should provide that
       person with a certificate or letter executed in accordance with the Corporations Act
       authorising him or her to act as that company’s representative. The authority may be sent to
       the Company or its share registry in advance of the General Meeting or handed in at the
       General Meeting when registering as a corporate representative.

       Members of Key Management Personnel and their Closely Related Parties will not be able to
       vote as proxy on Resolutions 1 to 4, 7 and 9 unless the Shareholder directs them how to
       vote or, in the case of the Chairman, unless the Shareholder expressly authorises him to do
       so. If a Shareholder intends to appoint a member of Key Management Personnel or their
       Closely Related Parties (other than the Chairman) as its proxy, the Shareholder should
       ensure that it directs the proxy how to vote on Resolutions 1 to 4, 7 and 9.

       If a Shareholder intends to appoint the Chairman as its proxy on Resolutions 1 to 4, 7 and 9
       the Shareholder can direct the Chairman how to vote by marking one of the boxes for those
       Resolutions (for example, if the Shareholder wishes to vote ‘for’, ‘against’ or to ‘abstain’ from
       voting). If a Shareholder does not direct the Chairman how to vote, the Shareholder can
       expressly authorise the Chairman to vote as the Chairman thinks fit on Resolutions 1 to 4, 7
       and 9 by marking the appropriate box on the Proxy Form even though those Resolutions are
       connected to the remuneration of members of Key Management Personnel and even if the
       Chairman has an interest in the outcome of those Resolutions.




                                             
      To vote by proxy, please complete and sign the enclosed Proxy Form and send by:

      (a)    post to the Company’s registered office at Suite 25, 145 Stirling Highway, Nedlands,
             Western Australia 6009;

      (b)    post to the Company at PO Box 3144, Nedlands, Western Australia 6009;

      (c)    facsimile to the Company on (08) 9389 3199; or

      (d)    email to the Company Secretary at winton@azc.com.au,

      so that it is received by no later than 9:00am (WST) on 10 December 2013. Proxy Forms
      received later than this time will be invalid.

2.    Voting entitlements
      In accordance with Regulations 7.11.37 and 7.11.38 of the Corporations Regulations 2001
      (Cth), the Board has determined that a person’s entitlement to vote at the General Meeting
      will be the entitlement of that person set out in the register of Shareholders as at 7:00pm
      (WST) on 10 December 2013. Accordingly, transactions registered after that time will be
      disregarded in determining Shareholder’s entitlement to attend and vote at the General
      Meeting.

3.    Resolutions 1 and 2 – Issue of Performance Options and Class A Incentive Options to
      Wayne Richards
3.1   Background

      As announced on 15 August 2013, the Company has appointed Wayne Richards as its
      Executive Chairman. Mr Richards commenced his role on 15 August 2013.

      The Company has entered into an employment agreement with Mr Richards in relation to his
      new role. Under the employment agreement, Mr Richards is entitled to a base salary of
      $250,000 per annum (inclusive of superannuation) and directors fees of $60,000 (inclusive of
      superannuation). In addition, the Company has agreed, subject to Shareholder approval, to
      issue the following securities to Mr Richards as part of his remuneration package:

       Security                  Number           Vesting           Expiry date   Exercise price
       Class A Performance      10,000,000    Upon                  31 August     $0.0001 each
       Options                                satisfaction of         2014
                                              the performance
                                              criteria set out in
                                              Annexure A
       Class B Performance      10,000,000    Upon                  31 August     $0.0001 each
       Options                                satisfaction of         2015
                                              the performance
                                              criteria set out in
                                              Annexure A
       Class C Performance      10,000,000    Upon                  31 August     $0.0001 each
       Options                                satisfaction of         2016
                                              the performance
                                              criteria set out in
                                              Annexure A




                                          
       Class A      Incentive   25,000,000      Upon issue        12 December        $0.015 each
       Options                                                        2016

      The Company believes that these securities provide a means by which the Company can
      reward Mr Richards for signing on to his new position and also provide a cost effective
      performance-based incentive to Mr Richards in his new role. The Directors consider it
      prudent to remunerate by way of securities so as to preserve the cash reserves of the
      Company.

      The benefit from the Performance Options will only be received if the Company satisfies
      certain performance targets and Mr Richards pays the relevant exercise price. Similarly, the
      benefit from the Class A Incentive Options will only be received if the Company’s Share price
      exceeds the exercise price of the Options at the time of exercise.

      The Company is seeking Shareholder approval to the issue of the Performance Options and
      the Class A Incentive Options in accordance with section 208 of the Corporations Act and
      Listing Rule 10.11.

3.2   Section 208 of the Corporations Act

      Section 208 of the Corporations Act states that a public company cannot give a “financial
      benefit” (including an issue of shares and options) to a “related party” of the Company unless
      one of the exceptions set out in section 210 to 216 of the Corporations Act apply, or the
      holders of ordinary securities have approved the giving of the financial benefit to the related
      party in a general meeting.

      As a Director, Mr Richards is a related party of the Company within the meaning specified
      under section 228 of the Corporations Act. Further, the provision of the Performance
      Options and Incentive Options constitutes a financial benefit within the meaning of section
      229 of the Corporations Act. Accordingly, Shareholder approval is sought under section 208
      of the Corporations Act to permit the issue of the Performance Options and Class A
      Incentive Options under Resolutions 1 and 2 to Mr Richards as a related party of the
      Company.

      As required by section 219 of the Corporations Act, the following information is provided in
      relation to Resolutions 1 and 2:

      (a)    Related party to whom the financial benefits are to be given

             Wayne Richards (and/or his nominee).

      (a)    Nature of the financial benefits

             The issue of 10,000,000 Class A Performance Options, 10,000,000 Class B
             Performance Options, 10,000,000 Class C Performance Options and 25,000,000
             Class A Incentive Options to Mr Richards. The Performance Options will be issued
             on the terms set out in Annexure A and the Class A Incentive Options will be issued
             on the terms set out in Annexure B.

      (b)    Valuation of the financial benefits

             The Company has engaged Stantons International to prepare independent valuations
             of the Performance Options and the Incentive Options.




                                           
Performance Options

The Black-Scholes option pricing model has been applied in providing valuation
information in respect to the Performance Options to be issued to Mr Richards.
Stantons International has determined that each Performance Option has an implied
value of $0.022902 for the Class A Performance Options, $0.022910 for the Class B
Performance Options and $0.022928 for the Class C Performance Options.
Accordingly, the aggregate implied value of the Incentive Options to be issued to Mr
Richards is $687,400.

The following variables and assumptions were used in the valuation:

(i)      A Share price of $0.023 (assumed closing price on the day of the General
         Meeting being the market price on ASX on 18 October 2013).

(ii)     A risk free interest rate of 2.99% (assumed on the day of the General
         Meeting).

(iii)    Respective expiry dates of 31 August 2014, 31 August 2015 and 31 August
         2016.

(iv)     An exercise price of $0.0001 each.

(v)      Volatility of 175%.

(vi)     No discount for non-transferability.

(vii)    The underlying Shares do not currently pay a dividend.

(viii)   In accordance with the relevant accounting standards no discount has been
         applied to reflect the requirements to meet the vesting conditions before the
         Performance Options vest.

Incentive Options

The Black-Scholes option pricing model has been applied in providing valuation
information in respect to the Incentive Options to be issued to Mr Richards. Stantons
International has determined that each Incentive Option has an implied value of
$0.020723 each. Accordingly, the aggregate implied value of the Incentive Options
to be issued to Mr Richards is $518,075.

The following variables and assumptions were used in the valuation:

(i)      A Share price of $0.023 (assumed closing price on the day of the General
         Meeting being the market price on ASX on 18 October 2013).

(ii)     A risk free interest rate of 2.99% (assumed on the day of the General
         Meeting).

(iii)    An expiry date of 12 December 2016.

(iv)     An exercise price of $0.015 each.

(v)      Volatility of 175%.



                               
      (vi)    No discount for non-transferability.

      (vii)   The underlying Shares do not currently pay a dividend.

(c)   Current remuneration and security interests

      Details of Mr Richards’ current annualised pro-rata remuneration, as well as his
      security interests (both direct and indirect) in the Company as at the date of the
      Notice, are outlined below:

       Director                      Salary/fees                Security interests
       Wayne Richards            $310,000 per annum                    Nil
                              (including superannuation)
      Notes:
      1.     If Resolution 9 is passed, the Company will be entitled to issue 5,000,000
             Shares to Mr Richards at an issue price of $0.012 each.

(d)   Dilution

      Performance Options

      If all of the Performance Options issued under Resolution 1 were converted into
      Shares, and no other Shares were issued by the Company (including Shares
      pursuant to Resolution 9 or the exercise of existing Options or the Incentive Options
      under Resolutions 2 to 7), the shareholding of existing Shareholders would, based on
      the current issued capital of the Company, be diluted by approximately 2.46%.

      Incentive Options

      If all of the Incentive Options issued under Resolution 2 were converted into Shares,
      and no other Shares were issued by the Company (including Shares pursuant to
      Resolution 9 or the exercise of existing Options, the Incentive Options under
      Resolutions 3 to 7 or the Performance Options under Resolution 1), the shareholding
      of existing Shareholders would, based on the current issued capital of the Company,
      be diluted by approximately 2.05%.

(e)   Accounting

      The Company’s adoption of Australian equivalents to International Financial
      Reporting Standards for reporting periods means that, under AASB2 Share-based
      Payment, equity-based compensation (such as the Performance Options and the
      Class A Incentive Options under Resolutions 1 and 2) will be recognised as an
      expense in respect of the services received.

(f)   Trading history

      As at the date of the Notice, the Company had 1,220,629,043 Shares on issue. The
      highest and lowest market sale price of the Shares in the Company during the twelve
      months immediately preceding the date of the Notice was $0.033 on 22 October
      2013 and $0.006 on 8 May 2013. The closing market sale price of the Company’s
      Shares on the ASX on 24 October 2013 was $0.028.

      As at the date of the Notice, the Company had the following unlisted Options on
      issue:



                                   
             Grant date        Expiry date       Exercise price           Number
            10 Nov 2011        10 Nov 2013            $0.03              1,250,000
            17 Jan 2009        17 Jan 2014            $0.10              6,750,000
            8 Mar 2011          8 Mar 2014            $0.01             25,000,000
            9 Sep 2010         9 Sep 2014             $0.05              5,000,000
             28 May and        30 April 2015         $0.036             28,500,000
            27 June 2012
            10 Nov 2011        10 Nov 2015            $0.05              1,250,000
                                                                        67,750,000

(g)   Terms of securities

      The terms of the Performance Options are set out in Annexure A and the terms of the
      Class A Incentive Options are set out in Annexure B.

(h)   Opportunity costs to the Company

      The Directors do not consider that there are any opportunity costs to the Company or
      benefits foregone by the Company in issuing the Performance Options or the
      Incentive Shares.

(i)   Intended use of funds raised

      There will be no funds raised in connection with the issue of the Performance Options
      or the Class A Incentive Options under Resolutions 1 and 2 as they are to be issued
      as part of Mr Richards’ remuneration package under his employment contract. The
      proceeds from a future exercise of the Performance Options or the Class A Incentive
      Options, however, are intended to be applied towards meeting working capital
      requirements of the Company relevant at, or about, the time of the exercise of the
      Class A Incentive Options at the discretion of the Board.

(j)   Directors’ interests

      Mr Richards has a material personal interest in the outcome of Resolutions 1 and 2
      as the recipient of the Performance Options and Class A Incentive Options. No other
      Director has a material personal interest in the outcome of Resolutions 1 and 2.

(k)   Directors’ recommendations

      Mr Richards expresses no opinion and makes no recommendation in respect of the
      issue of the Performance Options and Class A Incentive Options to him as he has a
      material personal interest in the outcome of Resolutions 1 and 2.

      Each of the other Directors recommends that Shareholders vote in favour of the issue
      of the Performance Options and Class A Incentive Options to Mr Richards for the
      reasons set out in the Explanatory Statement and on the basis that, in their opinion,
      the proposed issue of Performance Options and Class A Incentive Options:

      (i)     provides a long-term incentive to Mr Richards linked to the future success of
              the Company;




                                 
             (ii)    is a fair and reasonable alternative to additional cash remuneration; and

             (iii)   is necessary to reflect remuneration benefits payable to directors of other
                     companies operating in the Company’s industry and in an international
                     business environment.

      (l)    Other information

             Other than as set out in this Explanatory Statement, there is no further information
             that is known to the Company or any of the Directors which Shareholders would
             reasonably require in order to decide whether or not it is in the Company’s best
             interests to pass Resolutions 1 and 2.

3.3   Listing Rule 10.11

      Listing Rule 10.11 provides that a company must not issue equity securities to a “related
      party” without the approval of holders of ordinary securities, or to a person whose
      relationship with the company or a related party of the company is, in ASX’s opinion, such
      that approval should be obtained. Further, Listing Rule 7.2 (Exception 14) states that
      approval pursuant to Listing Rule 7.1 is not required if shareholder approval is obtained
      under Listing Rule 10.11.

      As a Director, Mr Richards is a related party of the Company within the definition specified in
      Listing Rule 19.12. Accordingly, Shareholder approval is sought under Listing Rule 10.11 to
      permit the issue of the Performance Options and the Class A Incentive Options under
      Resolutions 1 and 2 to Mr Richards as a related party of the Company.

      The issue of the Performance Options and Class A Incentive Options under Resolutions 1
      and 2 will not affect the capacity of the Company to issue securities in the next 12 months
      under Listing Rule 7.1, as those securities (once issued) will be excluded from the
      calculations under Listing Rule 7.1.

      As required by Listing Rule 10.13, the following information is provided in relation to
      Resolutions 1 and 2:

      (a)    Name of the person

             Wayne Richards (and/or his nominee).

      (b)    Maximum number of securities to be issued

             10,000,000 Class A Performance Options, 10,000,000 Class B Performance Options,
             10,000,000 Class C Performance Options and 25,000,000 Class A Incentive Options.

      (c)    Date by which the entity will issue the securities

             The Performance Options and Class A Incentive Options will be issued as soon as
             practicable after the General Meeting and, in any event, no later than 1 month after
             the General Meeting (or such later date to the extent permitted by any waiver of the
             Listing Rules).

      (d)    Relationship that requires Shareholder approval

             Mr Richards is a related party of the Company by virtue of being a Director of the
             Company.




     (e)    Issue price of the securities

             The Performance Options and the Class A Incentive Options will be issued without
             payment of cash consideration as they are being issued as part of Mr Richards’
             remuneration package under his employment contract.

      (f)    Terms of the issue

             The terms of the Performance Options are set out in Annexure A and the terms of the
             Class A Incentive Options are set out in Annexure B.

      (g)    Intended use of the funds raised

             There will be no funds raised in connection with the issue of the Performance Options
             or the Class A Incentive Options under Resolutions 1 and 2 as they are to be issued
             as part of Mr Richards’ remuneration package under his employment contract. The
             proceeds from a future exercise of the Performance Options or the Class A Incentive
             Options, however, are intended to be applied towards meeting working capital
             requirements of the Company relevant at, or about, the time of the exercise of the
             Class A Incentive Options at the discretion of the Board.

4.    Resolutions 3 and 4 – Issue of Incentive Options to Directors
4.1   Background

      The Company is seeking Shareholder approval to the issue of a total of 13,500,000 Incentive
      Options to Lennard Kolff van Oosterwijk and Matthew Bowles in accordance with section 208
      of the Corporations Act and Listing Rule 10.11. The Company proposes to issue the
      Incentive Options to Mr Kolff and Mr Bowles as follows:

       Recipient              Number and Class        Expiry date           Exercise price

       Lennard Kolff van      10,000,000 Class B     12 December      Exercisable at 135% of the
       Oosterwijk              Incentive Options         2016         30 day VWAP on 12
                                                                      December 2013

       Matthew Bowles         3,500,000 Class A      12 December      $0.015 each
                              Incentive Options          2016

      The Company believes that the Incentive Options provide a means by which the Company
      can reward Mr Kolff and Mr Bowles for their continued contribution to the Company’s
      progress to date and to further incentivise their ongoing performance and commitment to the
      Company. The Directors consider it prudent to remunerate by way of securities so as to
      preserve the cash reserves of the Company.

      The benefit from the Incentive Options will only be received if the Company’s Share price
      exceeds the exercise price of the Options at the time of exercise.

      The Company is seeking Shareholder approval to the issue of the Incentive Options in
      accordance with section 208 of the Corporations Act and Listing Rule 10.11.

4.2   Section 208 of the Corporations Act

      Section 208 of the Corporations Act states that a public company cannot give a “financial
      benefit” (including an issue of shares and options) to a “related party” of the Company unless



one of the exceptions set out in section 210 to 216 of the Corporations Act apply, or the
holders of ordinary securities have approved the giving of the financial benefit to the related
party in a general meeting.

As Directors, Mr Kolff and Mr Bowles are related parties of the Company within the meaning
specified under section 228 of the Corporations Act. Further, the provision of the Incentive
Options constitutes a financial benefit within the meaning of section 229 of the Corporations
Act. Accordingly, Shareholder approval is sought under section 208 of the Corporations Act
to permit the issue of the Incentive Options under Resolutions 3 and 4 to Mr Kolff and Mr
Bowles, respectively, as related parties of the Company.

As required by section 219 of the Corporations Act, the following information is provided in
relation to Resolutions 3 and 4:

(a)    Related parties to whom the financial benefits are to be given

       Lennard Kolff van Oosterwijk (and/or his nominee) and Matthew Bowles (and/or his
       nominee).

(b)    Nature of the financial benefits

       The issue of a total of 13,500,000 Incentive Options to Mr Kolff and Mr Bowles as
       follows:

        Recipient                                       Number and Class
        Lennard Kolff van Oosterwijk           10,000,000 Class B Incentive Options
        Matthew Bowles                          3,500,000 Class A Incentive Options
        Total                                      13,500,000 Incentive Options

       The Incentive Options will be issued on the terms set out in Annexure B

(c)    Valuation of the financial benefits

       The Company has engaged Stantons International to prepare an independent
       valuation of the Incentive Options.

       The Black-Scholes option pricing model has been applied in providing valuation
       information in respect to the Incentive Options to be issued to Mr Kolff and Mr
       Bowles. Stantons International has determined that each Class B Incentive Option
       has an implied value of $0.019698 whilst each Class A Incentive Option has an
       implied value of $0.020723. Accordingly, the aggregate implied value of the
       Incentive Options to be issued to Mr Kolff and Mr Bowles is as follows:

        Recipient               Implied value each          Number               Value
        Lennard Kolff van            $0.019698            10,000,000           $196,980
        Oosterwijk
        Matthew Bowles               $0.020723             3,500,000           $72,530
        Total                                             13,500,000           $269,510




                                          The following variables and assumptions were used in the valuation:

      (i)     A Share price of $0.023 (assumed closing price on the day of the General
              Meeting being the market price on ASX on 18 October 2013).

      (ii)    A risk free interest rate of 2.99% (assumed on the day of the General
              Meeting).

      (iii)   An expiry date of 12 December 2016.

      (iv)    An exercise price of $0.015 for the Class A Incentive Options and $0.03105
              for the Class B Incentive Options (being 135% of the assumed 30 day VWAP
              as at 12 December 2013).

      (v)     Volatility of 175%.

      (vi)    No discount for non-transferability.

      (vii)   The underlying Shares do not currently pay a dividend.

(d)   Current remuneration and security interests

      Details of Mr Kolff and Mr Bowles’ current annualised pro-rata remuneration, as well
      as their security interests (both direct and indirect) in the Company as at the date of
      the Notice, are outlined below:

       Director                              Salary/fees            Security interests
                                                                  ? Nil Shares
                                                            1
       Lennard Kolff van                $269,425 per annum
       Oosterwijk                    (including superannuation)   ? 15,000,000 Options2
       Matthew Bowles                    $40,000 per annum        ? 6,000,000 Shares
                                     (including superannuation)   ? 5,000,000 Options3

      Notes:
      1.     On 9 September 2013, the Company renewed the employment contract of
             Lennard Kolff van Oosterwijk, a summary of which is provided in Annexure C
             of this Notice in satisfaction of the relevant ASX guidelines requiring listed
             entities to disclose the relevant terms of the Managing Director’s
             remuneration.
      2.     Lennard Kolff van Oosterwijk holds an interest in 5,000,000 unlisted Options
             exercisable at $0.05 each and expiring on 9 September 2014 and 10,000,000
             unlisted Options exercisable at $0.036 each and expiring on 30 April 2015.
      3.     Matthew Bowles holds an interest in 5,000,000 unlisted Options exercisable at
             $0.036 each and expiring on 30 April 2015.

(e)   Dilution

      If all of the Incentive Options issued under Resolutions 3 and 4 were converted into
      Shares, and no other Shares were issued by the Company (including Shares
      pursuant to Resolution 9 or the exercise of existing Options, the Performance
      Options under Resolution 1 or the Incentive Options under Resolutions 2, 5, 6 and 7),
      the shareholding of existing Shareholders would, based on the current issued capital
      of the Company, be diluted by approximately 1.11%.




                                   
(f)   Accounting

      The Company’s adoption of Australian equivalents to International Financial
      Reporting Standards for reporting periods means that, under AASB2 Share-based
      Payment, equity-based compensation (such as the Incentive Options under
      Resolutions 3 and 4) will be recognised as an expense in respect of the services
      received.

(g)   Trading history

      As at the date of the Notice, the Company had 1,220,629,043 Shares on issue. The
      highest and lowest market sale price of the Shares in the Company during the twelve
      months immediately preceding the date of the Notice was $0.033 on 22 October
      2013 and $0.006 on 8 May 2013. The closing market sale price of the Company’s
      Shares on the ASX on 24 October 2013 was $0.028.

      As at the date of the Notice, the Company had the following unlisted Options on
      issue:

           Grant date          Expiry date       Exercise price          Number
          10 Nov 2011         10 Nov 2013            $0.03              1,250,000
          17 Jan 2009         17 Jan 2014            $0.10              6,750,000
           8 Mar 2011          8 Mar 2014            $0.01             25,000,000
           9 Sep 2010          9 Sep 2014            $0.05              5,000,000
          28 May and          30 April 2015          $0.036            28,500,000
         27 June 2012
          10 Nov 2011         10 Nov 2015            $0.05              1,250,000
                                                                       67,750,000

(h)   Terms of securities

      The terms of the Incentive Options are set out in Annexure B.

(i)   Opportunity costs to the Company

      The Directors do not consider that there are any opportunity costs to the Company or
      benefits foregone by the Company in issuing the Incentive Options.

(j)   Intended use of funds raised

      There will be no funds raised in connection with the issue of the Incentive Options
      under Resolutions 3 and 4 as the Incentive Options are to be issued without payment
      of cash consideration. The proceeds from a future exercise of the Incentive Options,
      however, are intended to be applied towards meeting working capital requirements of
      the Company relevant at, or about, the time of the exercise of the Incentive Options
      at the discretion of the Board.




                                 
      (k)    Directors’ interests

             Mr Kolff has a material personal interest in the outcome of Resolution 3 as the
             recipient of the Class B Incentive Options. No other Director has a material personal
             interest in the outcome of Resolution 3.

             Mr Bowles has a material personal interest in the outcome of Resolution 4 as the
             recipient of the Class A Incentive Options. No other Director has a material personal
             interest in the outcome of Resolution 4.

      (l)    Directors’ recommendations

             Each Director has a conflict of interest in relation to the Resolution which, if passed,
             will authorise the issue of Incentive Options to that Director. Accordingly, no Director
             expresses an opinion or makes a recommendation in respect of the Resolution which
             involves the issue of Incentive Options to himself and from which he is abstained
             from voting.

             The recommendation of the Directors and the reasons for that recommendation are
             as follows:

             (i)    each Director (other than the relevant abstaining Director) recommends that
                    Shareholders vote in favour of Resolutions 3 and 4; and

             (ii)   each of the Directors making the recommendation to vote in favour of
                    Resolutions 3 and 4 considers that those Resolutions are in the best interests
                    of the Company as recognition of the relevant Director’s continued
                    contribution to the Company's progress to date and to further incentivise their
                    ongoing performance and commitment to the Company.

      (m)    Other information

             Other than as set out in this Explanatory Statement, there is no further information
             that is known to the Company or any of the Directors which Shareholders would
             reasonably require in order to decide whether or not it is in the Company’s best
             interests to pass Resolutions 3 and 4.

4.3   Listing Rule 10.11

      Listing Rule 10.11 provides that a company must not issue equity securities to a “related
      party” without the approval of holders of ordinary securities, or to a person whose
      relationship with the company or a related party of the company is, in ASX’s opinion, such
      that approval should be obtained. Further, Listing Rule 7.2 (Exception 14) states that
      approval pursuant to Listing Rule 7.1 is not required if shareholder approval is obtained
      under Listing Rule 10.11.

      As Directors, Mr Kolff and Mr Bowles are related parties of the Company within the definition
      specified in Listing Rule 19.12. Accordingly, Shareholder approval is sought under Listing
      Rule 10.11 to permit the issue of the Incentive Options under Resolutions 3 and 4 to Mr
      Kolff and Mr Bowles as related parties of the Company.

      The issue of the Incentive Options under Resolutions 3 and 4 will not affect the capacity of
      the Company to issue securities in the next 12 months under Listing Rule 7.1, as those
      Incentive Options (once issued) will be excluded from the calculations under Listing Rule
      7.1.




                                          
      As required by Listing Rule 10.13, the following information is provided in relation to
      Resolutions 3 and 4:

      (a)    Name of the persons

            Lennard Kolff van Oosterwijk (and/or his nominee) and Matthew Bowles (and/or his
            nominee).

      (b)    Maximum number of securities to be issued

             A total of 13,500,000 Incentive Options as follows:

              Recipient                                        Number and Class
              Lennard Kolff van Oosterwijk           10,000,000 Class B Incentive Options
              Matthew Bowles                          3,500,000 Class A Incentive Options
              Total                                      13,500,000 Incentive Options

      (c)    Date by which the entity will issue the securities

             The Incentive Options will be issued as soon as practicable after the General Meeting
             and, in any event, no later than 1 month after the General Meeting (or such later date
             to the extent permitted by any waiver of the Listing Rules).

      (d)    Relationship that requires Shareholder approval

             Mr Kolff and Mr Bowles are related parties of the Company by virtue of being
             directors of the Company.

      (e)    Issue price of the securities

             The Incentive Options will be issued without payment of cash consideration.

      (f)    Terms of the issue

             The terms of the Incentive Options are set out in Annexure B.

      (g)    Intended use of the funds raised

             There will be no funds raised in connection with the issue of the Incentive Options
             under Resolutions 3 and 4 as the Incentive Options are to be issued without payment
             of cash consideration. The proceeds from a future exercise of the Incentive Options,
             however, are intended to be applied towards meeting working capital requirements of
             the Company relevant at, or about, the time of the exercise of the Incentive Options
             at the discretion of the Board.

5.    Resolutions 5 and 6 – Issue of Class A Incentive Options to Company Secretaries
5.1   Background

      The Company is seeking Shareholder approval to the issue of a total of 1,500,000 Class A
      Incentive Options to Aaron Finlay and Winton Willesee (the joint Company Secretaries) in
      accordance with Listing Rule 7.1. The Company proposes to issue the Class A Incentive
      Options to Mr Finlay and Mr Willesee as follows:




                                         
       Recipient                      Number                  Expiry date          Exercise price

       Aaron Finlay                   750,000             12 December 2016             $0.015

       Winton Willesee                750,000             12 December 2016             $0.015

      The Class A Incentive Options under Resolutions 5 and 6 will be issued to the Company
      Secretaries in recognition of their continued contribution to the Company’s progress to date
      and to further incentivise their ongoing performance and commitment to the Company. The
      Directors consider it prudent to remunerate by way of securities so as to preserve the cash
      reserves of the Company.

      The benefit from the Class A Incentive Options will only be received if the Company’s Share
      price exceeds the exercise price of the Options at the time of exercise.

      The Company is seeking Shareholder approval to the issue of the Class A Incentive Options
      in accordance with Listing Rule 7.1.

5.2   Listing Rule 7.1

      Listing Rule 7.1 provides that, subject to certain exceptions, prior approval of shareholders is
      required for an issue of securities by a company if those securities, when aggregated with
      the securities issued by the company during the previous 12 months (without approval and
      which were not subject to an exception), exceed 15% of the number of shares on issue at
      the commencement of that 12 month period.

      Listing Rule 7.1 provides that where a company approves an issue of securities, the
      company’s 15% capacity will be replenished and the company will be able to issue further
      securities up to that limit.

      Resolutions 5 and 6 seek the approval of the issue of 1,500,000 Class A Incentive Options
      for the purpose of satisfying the requirements of Listing Rule 7.1. If Resolutions 5 and 6 are
      approved, the Class A Incentive Options will not be included in the Company’s 15%
      calculation for the purposes of Listing Rule 7.1.

      As required by Listing Rule 7.3, the following information is provided in relation to
      Resolutions 5 and 6:

      (a)    Name of the persons to whom the entity will issue the securities

             Aaron Finlay (and/or his nominee) and Winton Willesee (and/or his nominee).

      (b)    Maximum number of securities the entity is to issue

             A total of 1,500,000 Class A Incentive Options as follows:

              Recipient                                                        Number
              Aaron Finlay                                                     750,000
              Winton Willesee                                                  750,000
              Total                                                           1,500,000




                                           
      (c)    Date by which the entity will issue the securities

             The Class A Incentive Options will be issued as soon as practicable after the General
             Meeting and, in any event, no later than 3 months after the General Meeting (or such
             later date to the extent permitted by any waiver of the Listing Rules).

      (d)    Issue price of the securities

             The Class A Incentive Options will be issued without payment of cash consideration.

      (e)    Terms of the securities

             The terms of the Class A Incentive Options are set out in Annexure B.

      (f)    Intended use of the funds

             There will be no funds raised in connection with the issue of the Class A Incentive
             Options under Resolutions 5 and 6 as the Class A Incentive Options are to be issued
             without payment of cash consideration. The proceeds from a future exercise of the
             Incentive Options, however, are intended to be applied towards meeting working
             capital requirements of the Company relevant at, or about, the time of the exercise of
             the Incentive Options at the discretion of the Board.

6.    Resolution 7 – Issue of Class A Incentive Options to Rockson Coffie
6.1   Background

      The Company is seeking Shareholder approval to the issue of 1,500,000 Class A Incentive
      Options to Rockson Coffie in accordance with Listing Rule 7.1.

      The Class A Incentive Options under Resolution 7 will be issued to Mr Coffie in
      consideration of geological consulting services provided by Mr Coffie to the Company to date
      and to further incentivise his ongoing performance and commitment to the Company. The
      Directors consider it prudent to remunerate by way of securities so as to preserve the cash
      reserves of the Company.

      The benefit from the Class A Incentive Options will only be received if the Company’s Share
      price exceeds the exercise price of the Options at the time of exercise.

      The Company is seeking Shareholder approval to the issue of the Class A Incentive Options
      in accordance with Listing Rule 7.1.

6.2   Listing Rule 7.1

      Listing Rule 7.1 provides that, subject to certain exceptions, prior approval of shareholders is
      required for an issue of securities by a company if those securities, when aggregated with
      the securities issued by the company during the previous 12 months (without approval and
      which were not subject to an exception), exceed 15% of the number of shares on issue at
      the commencement of that 12 month period.

      Listing Rule 7.1 provides that where a company approves an issue of securities, the
      company’s 15% capacity will be replenished and the company will be able to issue further
      securities up to that limit.

      Resolution 7 seeks the approval of the issue of 1,500,000 Class A Incentive Options for the
      purpose of satisfying the requirements of Listing Rule 7.1. If Resolution 7 is approved, the




                                           
      Class A Incentive Options will not be included in the Company’s 15% calculation for the
      purposes of Listing Rule 7.1.

      As required by Listing Rule 7.3, the following information is provided in relation to Resolution
      7:

      (a)    Name of the persons to whom the entity will issue the securities

             Rockson Coffie (and/or his nominee).

      (b)    Maximum number of securities the entity is to issue

             1,500,000 Class A Incentive Options.

      (c)    Date by which the entity will issue the securities

             The Class A Incentive Options will be issued as soon as practicable after the General
             Meeting and, in any event, no later than 3 months after the General Meeting (or such
             later date to the extent permitted by any waiver of the Listing Rules).

      (d)    Issue price of the securities

             The Class A Incentive Options will be issued without payment of cash consideration.

      (e)    Terms of the securities

             The terms of the Class A Incentive Options are set out in Annexure B.

      (f)    Intended use of the funds

             There will be no funds raised in connection with the issue of the Class A Incentive
             Options under Resolution 7 as the Class A Incentive Options are to be issued without
             payment of cash consideration. The proceeds from a future exercise of the Class A
             Incentive Options, however, are intended to be applied towards meeting working
             capital requirements of the Company relevant at, or about, the time of the exercise of
             the Class A Incentive Options at the discretion of the Board.

7.    Resolution 8 – Ratification of prior issues of Shares under the Placement
7.1   Background

      On 11 October 2013, the Company announced that it had agreed to issue 244,000,000
      Shares to existing and new Shareholders under a placement at an issue price of $0.012
      each to raise approximately $2.9m (Placement). The Company issued the Shares on 18
      October 2013 under its placement capacities in Listing Rules 7.1 and 7.1A.

      The Company is seeking Shareholder approval to the ratify the prior issue of Shares under
      the Placement in accordance with Listing Rule 7.1.

7.2   Listing Rule 7.4

      Listing Rule 7.1 provides that, subject to certain exceptions, prior approval of shareholders is
      required for an issue of securities by a company if those securities, when aggregated with
      the securities issued by the company during the previous 12 months (without approval and
      which were not subject to an exception), exceed 15% of the number of shares on issue at
      the commencement of that 12 month period.




                                           
      Shareholders passed a special resolution under Listing Rule 7.1A at the Company’s annual
      general meeting on 31 March 2013 which provides the Company with additional placement
      capacity equal to 10% of its issued capital.

      Listing Rule 7.4 provides that where a company ratifies a prior issue of securities, the issue
      will be treated as having been made with approval for the purpose of Listing Rule 7.1,
      thereby replenishing the company’s 15% capacity and enabling it to issue further securities
      up to that limit. In addition, prior issues of securities under Listing Rule 7.1A can be ratified
      under Listing Rule 7.4 to replenish a company’s additional 10% placement capacity and
      enable it to issue further securities up to that limit.

      Resolution 8 proposes the ratification of the issue of 244,000,000 Shares under the
      Placement for the purpose of satisfying the requirements of Listing Rule 7.4. If Resolution 8
      is approved, the Shares will not be included in the Company’s 15% calculation for the
      purposes of Listing Rule 7.1 or its 10% calculation for the purposes of Listing Rule 7.1A.

      As required by Listing Rule 7.5, the following information is provided in relation to Resolution
      8:

      (a)    Number of securities issued

             244,000,000 Shares.

      (a)    Price at which the securities were issued

             $0.012 each.

      (b)    Terms of the securities

             The Shares issued under the Placement rank equally in all respects with other
             Shares on issue.

      (c)    Name of the persons to whom the entity will issue the securities or the basis
             on which those persons were determined

             The Shares were issued to Exempt Investors who were clients of Canaccord Genuity
             (Australia) Limited.

      (d)    Intended use of the funds raised

             The Company intends to use the funds raised under the Placement to advance its
             Mofe Creek iron ore project through continued drilling, metallurgical testwork and the
             initiation of a scoping study.

8.    Resolution 9 – Issue of Shares to Wayne Richards
8.1   Background

      In conjunction with its announcement of the Placement on 11 October 2013, the Company
      advised that its Executive Chairman, Wayne Richards, wishes to subscribe for 5,000,000
      Shares at an issue price of $0.012 each to raise a further $60,000 for the Company. The
      issue of Shares to Mr Richards would be on the same terms as the issue of Shares to
      participants under the Placement.




                                           
      In addition to raising additional funds, the Company believes that the issue of Shares to Mr
      Richards will benefit the Company by further aligning the interests of Mr Richards with those
      of Shareholders.

      The Company is seeking Shareholder approval to the issue of the Shares in accordance with
      section 208 of the Corporations Act and Listing Rule 10.11.

8.2   Section 208 of the Corporations Act

      Section 208 of the Corporations Act states that a public company cannot give a “financial
      benefit” (including an issue of shares and options) to a “related party” of the Company unless
      one of the exceptions set out in section 210 to 216 of the Corporations Act apply, or the
      holders of ordinary securities have approved the giving of the financial benefit to the related
      party in a general meeting.

      As a Director, Mr Richards is a related party of the Company within the meaning specified
      under section 228 of the Corporations Act. Further, the issue of the Shares constitutes a
      financial benefit within the meaning of section 229 of the Corporations Act.

      The Directors consider that the issue of the Shares to Mr Richards under Resolution 9 falls
      within the exception to the requirement for Shareholder approval in section 210 of the
      Corporations Act as they consider that, given the issue is on the same terms as the
      Placement to non-related parties, the issue of the Shares is reasonable due to the parties
      dealing at arm’s length. However, the Company has nevertheless decided, out of an
      abundance of caution, to seek Shareholder approval under section 208 of the Corporations
      Act to permit the issue of the Shares under Resolution 9 to Mr Richards as a related party of
      the Company.

      As required by section 219 of the Corporations Act, the following information is provided in
      relation to Resolution 9:

      (a)    Related party to whom the financial benefit is to be given

             Wayne Richards (and/or his nominee).

      (b)    Nature of the financial benefit

             The issue of 5,000,000 Shares to Mr Richards at an issue price of $0.012 each.

      (c)    Valuation of the financial benefits

             The Shares will have a value of $60,000 based on the issue price of the Shares
             (being $0.012 each) and the amount to be paid by Mr Richards. However, the
             Shares will have a value of $140,000 based on the market price of Shares on the
             ASX at the close of trading on 24 October 2013 (being $0.028 each).

      (d)    Current remuneration and security interests

             Details of Mr Richards’ current annualised pro-rata remuneration, as well as his
             security interests (both direct and indirect) in the Company as at the date of the
             Notice, are outlined below:




                                          23
       Director                     Salary/fees                Security interests
       Wayne Richards           $310,000 per anunum                   Nil1
                             (including superannuation)

      Notes:
      1.     If Resolutions 1 and 2 are passed then Mr Richards will be issued 10,000,000
             Class A Performance Options, 10,000,000 Class B Performance Options,
             10,000,000 Class C Performance Options and 25,000,000 Class A Incentive
             Options.

(e)   Dilution

      If Shares are issued to Mr Richards then the shareholding of existing Shareholders
      would, based on the current issued capital of the Company, be diluted by
      approximately 0.41%.

(f)   Trading history

      As at the date of the Notice, the Company has 1,220,629,043 Shares on issue. The
      highest and lowest market sale price of the Shares in the Company during the twelve
      months immediately preceding the date of the Notice was $0.033 on 22 October
      2013 and $0.006 on 8 May 2013. The closing market sale price of the Company’s
      Shares on the ASX on 24 October 2013 was $0.028

(g)   Terms of the securities

      The Shares to be issued to Mr Richards will rank equally in all respects with other
      Shares on issue.

(h)   Opportunity costs to the Company

      The Directors do not consider that there are any opportunity costs to the Company or
      benefits foregone by the Company in issuing the Shares to Mr Richards.

(i)   Intended use of funds raised

      The Company intends to use the funds raised from the issue of Shares to Mr
      Richards to advance its Mofe Creek iron ore project through continued drilling,
      metallurgical testwork and the initiation of a scoping study.

(j)   Directors’ interests

      Mr Richards has a material personal interest in the outcome of Resolution 9 as the
      recipient of the Shares. No other Director has a material personal interest in the
      outcome of Resolution 9.

(k)   Directors’ recommendations

      Mr Richards expresses no opinion and makes no recommendation in respect of the
      issue of the Shares to him as he has a material personal interest in the outcome of
      Resolution 9.

      Each of the other Directors recommends that Shareholders vote in favour of the issue
      of the Shares to Mr Richards for the reasons set out in the Explanatory Statement
      and on the basis that, in their opinion, the proposed issue of Shares:




                                  24
             (i)     will raise an additional $60,000 for the Company which can be used to
                     advance its Mofe Creek iron ore project;

             (ii)    is fair and reasonable in the circumstances as it is on the same terms as the
                     issue of Shares to non-related parties under the Placement; and

             (iii)   will further align the interests of Mr Richards with those of Shareholders.

      (l)    Other information

             Other than as set out in this Explanatory Statement, there is no further information
             that is known to the Company or any of the Directors which Shareholders would
             reasonably require in order to decide whether or not it is in the Company’s best
             interests to pass Resolution 9.

8.3   Listing Rule 10.11

      Listing Rule 10.11 provides that a company must not issue equity securities to a “related
      party” without the approval of holders of ordinary securities, or to a person whose
      relationship with the company or a related party of the company is, in ASX’s opinion, such
      that approval should be obtained. Further, Listing Rule 7.2 (Exception 14) states that
      approval pursuant to Listing Rule 7.1 is not required if shareholder approval is obtained
      under Listing Rule 10.11.

      As a Director, Mr Richards is a related party of the Company within the definition specified in
      Listing Rule 19.12. Accordingly, Shareholder approval is sought under Listing Rule 10.11 to
      permit the issue of the Shares under Resolution 9 to Mr Richards as a related party of the
      Company.

      The issue of the Shares under Resolution 9 will not affect the capacity of the Company to
      issue securities in the next 12 months under Listing Rule 7.1, as those securities (once
      issued) will be excluded from the calculations under Listing Rule 7.1.

      As required by Listing Rule 10.13, the following information is provided in relation to
      Resolution 9:

      (a)    Name of the person

             Wayne Richards (and/or his nominee).

      (b)    Maximum number of securities to be issued

             5,000,000 Shares.

      (c)    Date by which the entity will issue the securities

             The Shares will be issued upon receipt of the subscription amount of $60,000 from
             Mr Richards and, in any event, no later than 1 month after the General Meeting (or
             such later date to the extent permitted by any waiver of the Listing Rules).

      (d)    Relationship that requires Shareholder approval

             Mr Richards is a related party of the Company by virtue of being a Director of the
             Company.




                                           25
      (e)    Issue price of the securities

             The issue price of the Shares will be $0.012 each.

      (f)    Terms of the issue

             The Shares will be issued to Mr Richards upon receipt of the subscription amount of
             $60,000. The Shares to be issued to Mr Richards will rank equally in all respects
             with other Shares on issue.

      (g)    Intended use of the funds raised

             The Company intends to use the funds raised from the issue of Shares to Mr
             Richards to advance its Mofe Creek iron ore project through continued drilling,
             metallurgical testwork and the initiation of a scoping study.

9.    Resolution 10 – Issue of Placement Options to Canaccord Genuity (Australia) Limited
9.1   Background

      As announced on 11 October 2013, Canaccord Genuity (Australia) Limited (Canaccord)
      acted as lead manager to the Placement. Canaccord’s role as lead manager was governed
      by a lead manager mandate (Lead Manager Mandate) under which the Company agreed to
      pay to Canaccord upon completion of the Placement:

      ?      a cash fee of 6% (plus GST) of the amount raised under the Placement; and

      ?      an Option fee of 10,000,000 Options with an exercise price at a 50% premium to the
             issue price under the Placement and an expiry date of 3 years from issue.

      Accordingly, the Company is seeking Shareholder approval to the issue of the Placement
      Options in accordance with Listing Rule 7.1.

9.2   Listing Rule 7.1

      Listing Rule 7.1 provides that, subject to certain exceptions, prior approval of shareholders is
      required for an issue of securities by a company if those securities, when aggregated with
      the securities issued by the company during the previous 12 months (without approval and
      which were not subject to an exception), exceed 15% of the number of shares on issue at
      the commencement of that 12 month period.

      Listing Rule 7.1 provides that where a company approves an issue of securities, the
      company’s 15% capacity will be replenished and the company will be able to issue further
      securities up to that limit.

      Resolutions 10 seeks the approval of the issue of 10,000,000 Placement Options for the
      purpose of satisfying the requirements of Listing Rule 7.1. If Resolution 10 is approved, the
      Placement Options will not be included in the Company’s 15% calculation for the purposes
      of Listing Rule 7.1.

      As required by Listing Rule 7.3, the following information is provided in relation to Resolution
      10:

      (a)    Name of the person to whom the entity will issue the securities

             Canaccord Genuity (Australia) Limited (and/or its nominee).




                                           
(b)   Maximum number of securities the entity is to issue

      10,000,000 Placement Options.

(c)   Date by which the entity will issue the securities

      The Placement Options will be issued as soon as practicable after the General
      Meeting and, in any event, no later than 3 months after the General Meeting (or such
      later date to the extent permitted by any waiver of the Listing Rules).

(d)   Issue price of the securities

      The Placement Options will be issued without payment of cash consideration as they
      are being issued as part of the fee payable to Canaccord under the Lead Manager
      Mandate.

(e)   Terms of the securities

      The terms of the Placement Options are set out in Annexure D.

(f)   Intended use of the funds

      There will be no funds raised in connection with the issue of the Placement Options
      under Resolution 10 as the Placement Options are to be issued without payment of
      cash consideration in accordance with the Lead Manager Mandate. The proceeds
      from a future exercise of the Placement Options, however, are intended to be applied
      towards meeting working capital requirements of the Company relevant at, or about,
      the time of the exercise of the Placement Options at the discretion of the Board.




                                  
Glossary
In this Notice and Explanatory Statement, the following terms have the following meanings:

Annexure                                an annexure to the Explanatory Statement.

ASIC                                    the Australian Securities and Investments Commission.

ASX                                     ASX Limited ACN 008 624 691 or the Australian Securities
                                        Exchange, as the context requires.

Board                                   the board of Directors.

Chairman                                the chair of the General Meeting.

Class A Performance Option              an Option on the terms set out in Annexure A.

Class B Performance Option              an Option on the terms set out in Annexure A.

Class C Performance Option              an Option on the terms set out in Annexure A.

Class A Incentive Option                an Option on the terms set out in Annexure B.

Class B Incentive Option                an Option on the terms set out in Annexure B

Closely Related Party                   a closely related party of a member of Key Management
                                        Personnel as defined in the Corporations Act, being:

                                        (a)        a spouse or child of the member;

                                        (b)        a child of that member’s spouse;

                                        (c)        a dependant of that member or of that member’s
                                                   spouse;

                                        (d)        anyone else who is one of that member’s family and
                                                   may be expected to influence that member, or be
                                                   influenced by that member, in that member’s
                                                   dealings with the Company;

                                        (e)        a company that is controlled by that member; or

                                        (f)        any other person prescribed by the regulations.

Company Secretary                       a company secretary of the Company.

Constitution                            the constitution of the Company.

Company                                 Tawana Resources NL ACN 085 166 721.

Corporations Act                        Corporations Act 2001 (Cth).

Director                                a director of the Company.




                                              
Exempt Investor            an investor to whom securities may be offered by the
                           Company without disclosure in accordance with section
                           708 of the Corporations Act (excluding section 708(1)).

Explanatory Statement      the explanatory statement incorporated in the Notice.

General Meeting            the general meeting convened by the Notice.

Incentive Option           an Option on the terms set out in Annexure B.

Key Management Personnel   the key management personnel of the Company as defined
                           in the Corporations Act and Australian Accounting
                           Standards Board accounting standard 124, being those
                           persons having authority and responsibility for planning,
                           directing and controlling the activities of the Company,
                           directly or indirectly, including any Director (whether
                           executive or otherwise).

Listing Rules              the ASX Listing Rules published and distributed by ASX.

Notice                     the notice of general meeting incorporating the Explanatory
                           Statement.

Performance Option         an Option on the terms set out in Annexure A.

Placement                  has the meaning given in Section 7.1.

Placement Option           an Option on the terms set out in Annexure D.

Proxy Form                 the proxy form attached to the Notice.

Option                     an option to acquire a Share.

Optionholder               a holder of an Option.

Resolution                 a resolution contained in the Notice.

Section                    a section contained in the Explanatory Statement.

Share                      a fully paid ordinary share in the capital of the Company.

Shareholder                a holder of a Share.

VWAP                       the volume weighted average price of Shares.

WST                        Western Standard Time, being the time in Perth, Western
                           Australia.




                             
Annexure A – Performance Options

(a)   (Performance Options) Each Performance Option is an option to acquire an ordinary share
      in the capital of Tawana Resources NL (Company).

(b)   (Exercise Price) The exercise price of each Performance Option is $0.0001 however the
      Performance Options are not exercisable until they have vested.

(c)   (General meetings) The Performance Options shall not confer on the holder (Holder) the
      right to receive notices of general meetings and financial reports and accounts of the
      Company that are circulated to holders of fully paid ordinary shares in the capital of the
      Company (Shareholders).       Holders have the right to attend general meetings of
      Shareholders.

(d)   (No voting rights) The Performance Options do not entitle the Holder to vote on any
      resolutions proposed at a general meeting of Shareholders.

(e)   (No dividend rights) The Performance Options do not entitle the Holder to any dividends.

(f)   (Rights on winding up) The Performance Options will not participate in the surplus profits
      or assets of the Company upon winding up of the Company.

(g)   (Not transferable) The Performance Options are not transferable.

(h)   (Reorganisation of capital) If at any time the issued capital of the Company is
      reconstructed, all rights of a Holder will be changed to the extent necessary to comply with
      the applicable Listing Rules at the time of reorganisation.

(i)   (Application to ASX) The Performance Options will not be quoted on ASX. However, upon
      conversion of the Performance Options into fully paid ordinary shares (Shares), the
      Company must within 10 Business Days after the conversion, apply for the official quotation
      of the Shares arising from the conversion on ASX.

(j)   (Participation in entitlements and bonus issues) Holders of Performance Options will not
      be entitled to participate in new issues of capital offered to Shareholders such as bonus
      issues and entitlement issues.

(k)   (No other rights) The Performance Options give the Holders no rights other than those
      expressly provided by these terms and those provided at law where such rights at law
      cannot be excluded by these terms.

(l)   (Vesting on achievement of milestones)

      Vesting of the following types of Performance Options is subject to the following milestones:

      (i)    Class A Performance Options

             The Class A Performance Options will vest upon achievement of all of the following
             milestones (the Class A Performance Options Milestone) on or before 30 August
             2014:

             (A)     Completion of a drilling and metallurgy program to develop a JORC compliant
                     resource (inferred and indicated) for Mofe Creek, complete with bulk samples
                     for metallurgical testing and flowsheet/plant design criteria.




                                          
        (B)    Completion of a capital raising of sufficient funds via equity placements and/or
               strategic investment/JV partnering arrangements to conclude the funding of
               the Mofe Creek scoping study and ensure sufficient funds are available for
               the continuance of the Project into a pre-feasibility study mode.

        (C)    Completion of a scoping study for the Mofe Creek Project.

        (D)    Commencement of necessary mining, logistics and environmental/community
               applications/agreements, to assist in the future development of the Mofe
               Creek Project.

        (E)    Structuring of the Board and relevant committees to ensure ASX compliance
               and project execution capability.

(ii)    Class B Performance Options

        The Class B Performance Options will vest upon achievement of all of the following
        milestones (the Class B Performance Options Milestone) on or before 30 August
        2015:

        (A)    Completion of a pre-feasibility study for Mofe Creek.

        (B)    Finalisation of the preferred Mofe Creek logistics business solution, including,
               but not limited to, ore trucking solutions and/or rail studies, port storage and
               loading facilities, trans-shipment or direct shipping solutions, and marketing.

        (C)    Commencement of the mining lease application process and Environmental
               Protection Authority (EPA) approvals for Mofe Creek Project development.

        (D)    Finalisation of the processing plant design criteria, including flowsheet, PFD's
               and equipment design and selection.

        (E)    Completion of a strategic business plan outlining the plant throughput
               capacity, Project ramp-up, LOM plans and duration, along with Project
               financials (NPV, IRR, DCF, CAPEX, OPEX etc).

        (F)    Development of a financial model reflective of the preferred Project funding
               methodologies to be deployed for the feasibility and definitive feasibility
               studies.

        (G)    Undertake a strategic review and/or development plan on the development of
               a potential start-up Project for any DSO ore present (i.e. found) at Mofe
               Creek.

        (H)    Completion of the environmental studies required to support the PFS and
               EPA applications.

        (I)    Development of an indicated mine plan, mining schedule and mining
               methodology strategy with an upgrade in resource categorisation to indicated
               and measured.

        (J)    Determine, target and/or secure funding for the PFS and FS depending upon
               the status of the Mofe Creek Project and the potential early start-up of a DSO
               operation.

(iii)   Class C Performance Options



                                    
             The Class C Performance Options will vest upon achievement of all of the following
             milestones (the Class C Performance Options Milestone) on or before 30 August
             2016:

             (A)     Selection and management of relevant engineering firms and logistics groups
                     to design and structure the appropriate contractual and operational
                     agreements to support the development of a definitive feasibility study.

             (B)     Completion of a feasibility study and commencement of a DFS and/or BFS
                     (as defined by the Board).

             (C)     Completion of all metallurgical testwork, finalisation of a start-up mine
                     plan/schedule and acknowledgement of all relevant mining approvals.

             (D)     Receipt of all licences required to mine, build and operate the mine and plant.

             (E)     Approval of necessary licences, land tenure and road access/operating
                     agreements to transport ore from the mine to the nominated port/coastal
                     location.

             (F)     Development of the contractual arrangements (commercial, financial, legal
                     and operational) for the trans-shipment of ore via the preferred coastal
                     destination.

             (G)     Approval of the Mofe Creek Mining Lease, EPA approval and relevant
                     stakeholder (local village/local and state government) agreements to support
                     the development of a DFS/BFS.

             (H)     Securement of adequate and optimal funding to progress the FS and the
                     refinement  of    the    financial model   to    support   BFS/Project
                     Development financing discussions.

             (I)     Structure, recruit and manage the required Project personnel.

(m)   (Lapse) If the relevant Milestone is not achieved by the required date or, subject to clause
      (p), if the Holder ceases to be engaged by the Company before the relevant Milestone is
      achieved, the relevant Performance Options will lapse.

(n)   (Exercise procedure) Subject to the Performance Options having vested, the Holder may
      exercise the Performance Options at any time on or before the expiry date (being the date
      that is 1 day after the date that the relevant Milestone must be achieved) by providing to the
      Company an exercise notice with the relevant exercise monies. The Company will issue the
      Holder with a new holding statement for the Shares within 10 Business Days following
      exercise.

(o)   (Ranking upon exercise) The Shares into which the Performance Options may convert will
      rank pari passu in all respects with existing Shares.

(p)   (Vesting on Change of Control) All unvested Performance Options will immediately vest
      and be exercisable if any of the following change of control events occur prior to the required
      date for achievement of the relevant Milestone and prior to the cessation of the Holder’s
      engagement with the Company:




                                          
(i)     a party acquires a relevant interest in more than 50% of the Shares in the Company
        under a scheme of arrangement between the Company and its creditors or members
        or any class thereof pursuant to section 411 of the Corporations Act;

(ii)    a party acquires a relevant interest in more than 50% of the Company’s ordinary
        Shares pursuant to a takeover bid; or

(iii)   a person or a group of associated persons becomes entitled to sufficient Shares to
        give it or them the ability, in general meeting, to replace all or a majority of the Board
        and such changes to the Board are implemented.

All Performance Options vesting under this clause will lapse unless that are exercised within
        7 days of vestment.




                                      
Annexure B – Incentive Options
1.   General

     1.1    No monies will be payable for the issue of the Incentive Options.

     1.2    The Incentive Options will expire on 12 December 2016 (Expiry Date).

     1.3    Each Incentive Option shall carry the right, subject to any Shareholder approval
            required under the Corporations Act or the Listing Rules, to subscribe for one fully
            paid ordinary share in the capital of the Company (Share).

     1.4    Incentive Options may be exercised in whole or in part in parcels. An exercise of only
            some Incentive Options shall not affect the rights of the party holding the Option
            (Incentive Optionholder) to the balance of the Incentive Options held by the
            Incentive Optionholder.

     1.5    The exercise price of each CIass A Incentive Option is $0.015 and the exercise price
            of each Class B Incentive Option is 135% of the 30 day VWAP of Shares traded on
            the ASX as at the date of the Shareholders meeting at which the grant of Incentive
            Options is approved (Exercise Price).

     1.6    The Exercise Price for the Incentive Options shall be payable in full on exercise of
            those Incentive Options.

     1.7    Incentive Options are only exercisable by the delivery to the registered office of the
            Company of a notice in writing. The notice must specify the number of Incentive
            Options being exercised and must be accompanied by:

            (a)    the option certificate for those Incentive Options for cancellation by the
                   Company; and

            (b)    payment of the Exercise Price for each Share to be issued on exercise of the
                   Incentive Options specified in the notice.

            The notice is only effective (and only becomes effective) when the Company has
            received value for the full amount of the Exercise Price (for example, if the Exercise
            Price is paid by cheque, by clearance of that cheque) by the Expiry Date.

     1.8    The Company shall allot the resultant Shares and deliver the holding statements
            within 10 Business Days of the exercise of the Incentive Options.

     1.9    Incentive Options may be exercised into Shares to be held in the name of the
            Incentive Optionholder's nominee.

     1.10   The Incentive Options are transferable with Board approval. It is not intended that an
            application will be made to ASX for the quotation of the Incentive Options.

     1.11   Shares allotted pursuant to an exercise of Incentive Options shall rank, from the date
            of allotment, equally with existing Shares of the Company in all respects.

     1.12   The Company shall, in accordance with the Listing Rules, make application to have
            Shares allotted pursuant to an exercise of Incentive Options listed for official
            quotation on the ASX, if the Company is listed on the ASX at the time.




                                        
     1.13   The Incentive Optionholder is not entitled to participate in any new issue of securities
            to existing holders of Shares in the Company unless the Incentive Optionholder
            exercises the Incentive Options before the record date for the determination of
            entitlements to the new issue of securities and participates as a result of being a
            holder of Shares. The Company must give the Incentive Optionholder, in accordance
            with the Listing Rules, notice of any new issue of securities before the record date for
            determining entitlements to the new issue.

     1.14   If there is a bonus share issue (Bonus Issue) to the holders of Shares, the number of
            Shares over which an Incentive Option is exercisable will be increased by the number
            of Shares which the Incentive Optionholder would have received if the Incentive
            Option had been exercised before the record date for the Bonus Issue (Bonus
            Shares). The Bonus Shares must be paid up by the Company out of the profits or
            reserves (as the case may be) in the same manner as was applied in the Bonus
            Issue and upon issue rank pari passu in all respects with the other shares of that
            class on issue at the date of issue of the Bonus Shares.

     1.15   If there is a pro rata issue (other than a Bonus Issue) to the holders of Shares during
            the currency, and prior to the exercise, of any Incentive Options, the Exercise Price of
            an Incentive Option and the number of Shares over which the Incentive Options are
            exercisable will not be adjusted.

     1.16   If, prior to the expiry of any Incentive Options, there is a reorganisation of the issued
            capital of the Company, then the rights of the Incentive Optionholder (including the
            number of Incentive Options to which each Incentive Optionholder is entitled and the
            Exercise Price) is changed to the extent necessary to comply with the Listing Rules
            applying to a reorganisation of capital at the time of the reorganisation.

     1.17   The Incentive Options will not give any right to participate in dividends until Shares
            are allotted pursuant to the exercise of the relevant Incentive Options.

2.   Lapse of Incentive Options

     2.1    Incentive Options not validly exercised on or before the Expiry Date will automatically
            lapse.

     2.2    If at any time prior to the Expiry Date an Incentive Optionholder dies, the deceased
            Incentive Optionholder's legal personal representative may:

            (a)    elect to be registered as the new holder of the deceased Incentive
                   Optionholder's Incentive Options;

            (b)    whether or not he or she becomes so registered, exercise those Incentive
                   Options in accordance with and subject to these terms as if he were the
                   Incentive Optionholder of them; and

            (c)    if the deceased Incentive Optionholder had already given the Company a
                   notice of exercise of his or her Incentive Options, pay the Exercise Price in
                   respect of those Incentive Options.

     2.3    Subject to clause 2.4, and notwithstanding that the Board has discretion to waive this
            accelerated lapsing provision, in the event that the Incentive Optionholder resigns as
            a director of the Company, or is removed from the Board of the Company for any
            reason, the Incentive Options shall lapse 28 days following the resignation or
            removal.




                                         
2.4   Clause 2.3 does not apply if any of the following change of control events occur
      subsequent to the grant of the Options but prior to the cessation of the Incentive
      Optionholder’s engagement with the Company:

      (a)    a party acquires a relevant interest in more than 50% of the Shares in the
             Company under a scheme of arrangement between the Company and its
             creditors or members or any class thereof pursuant to section 411 of the
             Corporations Act;

      (b)    a party acquires a relevant interest in more than 50% of the Company’s
             ordinary Shares pursuant to a takeover bid; or

      (c)    a person or a group of associated persons becomes entitled to sufficient
             Shares to give it or them the ability, in general meeting, to replace all or a
             majority of the Board and such changes to the Board are implemented.

      Should any of the above change of control events occur subsequent to the grant of
      the Options but prior to the cessation of the Incentive Optionholder’s engagement
      with the Company, the Options will not lapse within 28 days of the date of cessation
      of the Incentive Optionholder’s engagement with the Company and the respective
      Expiry Date referred to in clause 1.3 will apply.




                                  
Annexure C – Details of Managing Director’s remuneration
In accordance with ASX guidelines requiring listed entities to disclose the relevant terms of the
Managing Director’s remuneration, Tawana reports the following relevant terms of its
employment agreement with Lennard Kolff van Oosterwijk.

 Duration of Contract             Ongoing until terminated by either party.

 Services                        Those services usually required of a Managing Director of a
                                 company the size and nature of Tawana.

 Remuneration                    1. Executive salary of $229,425 per annum inclusive of
                                    superannuation; and
                                 2. Director’s fee of $40,000 per annum inclusive of
                                    superannuation.

 Performance Related             1. A$25,000      pre-tax    cash   bonus    (inclusive   of
                                    superannuation) following the completion of a successful
                                    capital raising during which the Company raises a
                                    minimum of $2.5 million;
                                 2. A$25,000 pre-tax cash bonus (inclusive of superannuation)
                                    upon the announcement of a JORC compliant resource at
                                    the Mofe Creek Iron Ore Project; and
                                 3. Upon the completion of a Scoping Study on the Mofe Creek
                                    Iron Ore Project, a performance bonus of 10,000,000
                                    options to acquire ordinary fully paid shares in the
                                    Company (or other agreed instruments subject to taxation
                                    advice), with an exercise price equal to 135% of the 30 Day
                                    VWAP of shares traded on ASX on the date of the
                                    shareholders meeting at which the grant is approved, with
                                    an expiry date no less than three years from the date of
                                    issue.

 Termination                     The agreement provides that the Company may terminate
                                 the employment of Lennard Kolff van Oosterwijk by giving 6
                                 months’ notice or payment in lieu of such notice.
                                 Similarly, in the event that Tawana is the subject of a
                                 successful takeover and where Len Kolff is not offered
                                 ongoing employment on terms and conditions no worse than
                                 his existing employment agreement, Len Kolff will be
                                 entitled to 6 months’ notice or payment in lieu of such
                                 notice.
                                 Len Kolff may terminate his employment with the Company
                                 by giving 3 months’ notice.




                                         
Annexure D – Placement Options
The terms and conditions of the Placement Options are as follows:

(a)    The Placement Options will be issued for nil consideration.

(b)    Each Placement Option entitles the holder (Optionholder) to subscribe for and be issued 1
       fully paid ordinary share in the capital of the Company.

(c)    The Placement Options are exercisable at $0.018 each (Exercise Price).

(d)    The Placement Options will expire on 12 December 2016 (Expiry Date).

(e)    Subject to clause (f), the Placement Options are exercisable at any time on or prior to the
       Expiry Date by notice in writing to the Company accompanied by payment of the Exercise
       Price multiplied by the number of Placement Options being exercised.

(f)    The issue of Shares upon the conversion of Placement Options will be subject to the
       Company obtaining any necessary shareholder approval for the purposes of item 7 of
       section 611 of the Corporations Act.

(g)    The Options may only be transferred with the prior written consent of the Board.

(h)    No application to ASX will be made for quotation of the Options.

(i)    All Shares issued upon exercise of the Options will rank equally in all respects with the
       Company’s then existing fully paid ordinary shares. The Company will apply to ASX for
       quotation of all Shares issued upon exercise of the Options.

(j)    There are no participating rights or entitlements inherent in the Options and Optionholders
       will not be entitled to participate in new issues of capital offered to Shareholders during the
       term of the Options. However, if from time to time during the term of the Options the
       Company proposes to make an issue of new Shares to Shareholders, the Company will
       notify each Optionholder at least 6 Business Days before the record date for the proposed
       issue of Shares (or by any other time provided that the Company complies with the ASX
       Listing Rules). This will give Optionholders the opportunity to exercise their Options prior to
       the date for determining entitlements to participate in the proposed issue of Shares to
       Shareholders.

(k)    If from time to time during the term of the Options the Company makes an issue of Shares to
       Shareholders by way of capitalisation of profits or reserves (Bonus Issue) then, upon
       exercise of their Options, Optionholders will be entitled to have issued to them (in addition to
       the Shares which would otherwise be issued to them upon such exercise) the number of
       Shares which would have been issued to them under that Bonus Issue (Bonus Shares) if,
       on the record date for the Bonus Issue, they had been registered as the holder of the
       number of Shares of which they would have been registered as holder if, immediately prior to
       that date, they had exercised their Options and the Shares the subject of such exercise had
       been issued to them. The Bonus Shares will be paid up by the Company out of profits or
       reserves (as the case may be) in the same manner as was applied in relation to the Bonus
       Issue and upon issue will rank equally in all respects with the Company’s then existing fully
       paid ordinary shares.

(l)    There is no right to a change in the Exercise Price or to the number of Shares over which the
       Options are exercisable in the event of a new issue of capital (other than for a Bonus Issue
       referred to in clause (k)) during the term of the Options.




                                            
(m)   In the event of any reorganisation of the issued capital of the company during the term of the
      Options, the rights of an Optionholder will be changed to the extent necessary to comply with
      the Listing Rules.



7 November 2013

Sponsor

PricewaterhouseCoopers Corporate Finance (Pty) Ltd




                                         
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