4DS MEMORY LIMITED - Proxy Solicitation & Information Statement 2013

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FITZROY RESOURCES LIMITED ACN 145 590 110

NOTICE OF GENERAL MEETING

A General Meeting of the Company will be held at Level 1, 35‐37 Havelock Street, West Perth, Western Australia on 16 December 2013 at 9.30am (WST).

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

Should you wish to discuss any matter please do not hesitate to contact the Company by telephone on +61 08 9481 7111

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FITZROY RESOURCES LIMITED

ACN 145 590 110

NOTICE OF GENERAL MEETING

Notice is hereby given that a general meeting of Shareholders of Fitzroy Resources Limited ( Company ) will be held at Level 1, 35‐37 Havelock Street, West Perth, Western Australia on 16 December 2013 at 9.30am (WST) ( Meeting ).

The Explanatory Memorandum to this Notice provides additional information on matters to be considered at the Meeting. The Explanatory Memorandum and the Proxy Form form part of this Notice.

The Directors have determined pursuant to regulation 7.11.37 of the Corporations Regulations 2001 (Cth) that the persons eligible to vote at the Meeting are those who are registered as Shareholders on 14 December 2013 at 4pm (WST).

Terms and abbreviations used in this Notice and Explanatory Memorandum are defined in Section 12.

AGENDA

1. Resolution 1 – Approval of Acquisition of Premier Coal

To consider and, if thought fit, to pass, with or without amendment, the following as an ordinary resolution:

“That, subject to Resolutions 2 and 3 being passed, for the purposes of and in accordance with Listing Rule 7.1 and for all other purposes, Shareholders approve the issue of:

(a) 20,000,000 Shares and 20,000,000 Performance Shares to the Vendors of Premier Coal;
(b) 7,500,000 Shares to Emmaus (or its nominee); and
(c) 2,500,000 Shares to Blackstone (or its nominee),

in accordance with the Acquisition of Premier Coal pursuant to the Option Agreement on the terms set out in the Explanatory Memorandum."

Voting Exclusion

The Company will disregard any votes cast on this Resolution by Premier Coal, Premier US, the Vendors, Emmaus and Blackstone and any of their associates.

However, the Company will not disregard a vote if:

(a) it is cast by a 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 – Approval of Change in Scale of Activities

To consider and, if thought fit, to pass, with or without amendment, the following as an ordinary resolution:

"That, subject to Resolutions 1 and 3 being passed, for the purposes of and in accordance with Listing Rule 11.1.2 and for all other purposes, Shareholders approve the significant change in the scale of the Company's activities resulting from the Acquisition on the terms set out in the Explanatory Memorandum."

Voting Exclusion

The Company will disregard any votes cast on this Resolution by a person who might obtain a benefit (except a benefit solely in the capacity of a holder of ordinary securities) if the Resolution is passed and any of their associates.

However, the Company will not disregard a vote if:

(a) it is cast by a 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 – Approval of Performance Shares

To consider and, if thought fit, to pass, with or without amendment, the following resolution as a special resolution:

"That, subject to Resolutions 1 and 2 being passed, for the purposes of section 246B(1) of the Corporations Act and clause 2.3 of the Constitution of the Company and for all other purposes, the Company be authorised to create a new class of share on the terms and conditions in Schedule 1 and in the Explanatory Memorandum accompanying this Notice ( Performance Shares ).”

4. Resolution 4 – Authority to issue Placement Shares

To consider and, if thought fit, to pass with or without amendment, the following resolution as an ordinary resolution:

"That, subject to Resolutions 1, 2 and 3 being passed, pursuant to and in accordance with Listing Rule 7.1 and for all other purposes, Shareholders approve and authorise the Directors to issue up to 20,000,000 Shares ( Placement Shares ) each at an issue price that is not less than 80% of the average market price for Shares calculated over the 5 days on which sales in the Shares are recorded before the day on which the issue is made ( Placement ) on the terms and conditions set out in the Explanatory Memorandum.”

Voting Exclusion

The Company will disregard any votes cast on this Resolution by a person who may participate in the issue of the Subsequent Placement Shares and a person who might obtain a benefit (except a benefit solely in their capacity as holder of ordinary securities) if the Resolution is passed and any associates of those persons.

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 person chairing the Meeting 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 – Authority to Issue Adviser Shares – Argonaut

To consider and, if thought fit, to pass with or without amendment, the following resolution as an ordinary resolution:

"That, subject to Resolutions 1, 2 and 3 being passed, for the purposes of and in accordance with Listing Rule 7.1 and for all other purposes, Shareholders approve and authorise the Directors to issue up to 2,000,000 Shares ( Adviser Shares ) to Argonaut Securities Pty Ltd (or its nominee) on the terms and conditions set out in the Explanatory Memorandum.”

Voting Exclusion

The Company will disregard any votes cast on this Resolution by Argonaut and a person who might obtain a benefit (except a benefit solely in their capacity as holder of ordinary securities) if the Resolution is passed and any associates of those persons.

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 person chairing the Meeting 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 – Authority to Issue Adviser Shares – Forrest Capital

To consider and, if thought fit, to pass with or without amendment, the following resolution as an ordinary resolution:

"That, subject to Resolutions 1, 2 and 3 being passed, for the purposes of and in accordance with Listing Rule 10.11 and for all other purposes, Shareholders approve and authorise the Directors to issue up to 2,000,000 Shares ( Adviser Shares ) to Forrest Capital Pty Ltd (or its nominee) on the terms and conditions set out in the Explanatory Memorandum.”

Voting Exclusion

The Company will disregard any votes cast on this Resolution by Forrest Capital and any associate of Forrest Capital.

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 person chairing the Meeting 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 – Adoption of Fitzroy Resources Employee Share Acquisition Plan

To consider and, if thought fit, to pass with or without amendment, the following resolution as an ordinary resolution:

“That, for the purposes of Listing Rule 7.2 Exception 9(b), as an exception to Listing Rule 7.1, sections 259B and 260A of the Corporations Act and for all other purposes, approval is given for the establishment of the “Fitzroy Resources Employee Share Acquisition Plan” on the terms and conditions summarised in Schedule 2 and in the Explanatory Memorandum.”

Voting Exclusion

The Company will disregard any votes cast on this Resolution by a Director (except one who is ineligible to participate in any employee incentive scheme in relation to the Company) and any of their associates.

However, the Company will not disregard a vote if:

(a) it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or
(b) it is cast by the person chairing the Meeting 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.

Voting Prohibition Statement

A person appointed as a proxy must not vote, on the basis of that appointment, on this Resolution if:

(a) the proxy is either:
(i) a member of the Key Management Personnel; or
(ii) a Closely Related Party of such a member; and
(b) the appointment does not specify the way the proxy is to vote on this Resolution.

However, the above prohibition does not apply if:

(c) the proxy is the Chair of the Meeting; and
(d) the appointment expressly authorises the Chair to exercise the proxy even if the Resolution is connected directly or indirectly with the remuneration of a member of the Key Management Personnel.

8. Resolution 8– Authority to Allocate Plan Shares to a Director – Mr Russell Lynton‐Brown

To consider, and if thought fit, to pass with or without amendment, the following resolution as an ordinary resolution:

"That, conditional upon Resolution 7 being approved, pursuant to and in accordance with Listing Rule 10.14, and for all other purposes, the Shareholders authorise the Allocation of up to 500,000 Shares under the Fitzroy Resources Employee Share Acquisition Plan, and the provision of a loan, to Mr Russell Lynton‐Brown for the purpose of acquiring the Shares under the Fitzroy Resources Employee Share Acquisition Plan on the terms and conditions in the Explanatory Memorandum."

Voting Exclusion

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 person chairing the Meeting 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.

Voting Prohibition Statement

A person appointed as a proxy must not vote, on the basis of that appointment, on this Resolution if:

(a) the proxy is either:
(i) a member of the Key Management Personnel; or
(ii) a Closely Related Party of such a member; and
(b) the appointment does not specify the way the proxy is to vote on this Resolution.

However, the above prohibition does not apply if:

(c) the proxy is the Chair of the Meeting; and
(d) the appointment expressly authorises the Chair to exercise the proxy even if the Resolution is connected directly or indirectly with the remuneration of a member of the Key Management Personnel.

Dated 13 November 2013

BY ORDER OF THE BOARD

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Simon Robertson Company Secretary

FITZROY RESOURCES LIMITED

ACN 145 590 110

EXPLANATORY MEMORANDUM

1. Introduction

This Explanatory Memorandum has been prepared for the information of Shareholders in connection with the business to be conducted at the Meeting to be held at Level 1, 35‐37 Havelock Street, West Perth, Western Australia, on 16 December 2013 at 9.30am (WST).

This Explanatory Memorandum should be read in conjunction with, and forms part of, the accompanying Notice. The purpose of this Explanatory Memorandum is to provide information to Shareholders in deciding whether or not to pass the Resolutions set out in the Notice.

A Proxy Form is located at the end of the Explanatory Memorandum.

2. Action to be taken by Shareholders

Shareholders should read the Notice and this Explanatory Memorandum carefully before deciding how to vote on the Resolutions.

2.1 Proxies

A Proxy Form is attached to the Notice. This is to be used by Shareholders if they wish to appoint a representative (a 'proxy') to vote in their place. All Shareholders are invited and encouraged to attend the Meeting or, if they are unable to attend in person, sign and return the Proxy Form to the Company in accordance with the instructions thereon. Lodgment of a Proxy Form will not preclude a Shareholder from attending and voting at the Meeting in person.

Please note that:

(a) a member of the Company entitled to attend and vote at the Meeting is entitled to appoint a proxy;
(b) a proxy need not be a member of the Company; and
(c) a member of the Company 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.

3. Overview of Acquisition and Change of Scale of Activities

3.1 Background

Fitzroy Resources Limited ( Company ) is an Australian public company which has been listed on the official list of ASX (ASX code: FRY) since December 2010. Fitzroy Resources is base metal focused with two projects, Rookwood and Glentanna, in Central and Southern Queensland, Australia.

Since acquiring the projects, Fitzroy has conducted several field work programs. After weather related delays, exploration commenced in February 2011 with immediate success at the Develin Creek deposit at Rookwood where a 13 meter zone of massive sulphide was intersected.

In the three years of production, Fitzroy has increased the knowledge of the extent of mineralisation at Rookwood through its RC and diamond drilling campaigns as well as HELITEM, downhole EM and geochemical sampling field programs.

At Glentanna, fixed loop EM work improved the knowledge of mineralization at the Grieves Quarry prospect.

While weather related issues have hampered the Company’s exploration efforts since listing, Fitzroy continues to focus on adding shareholder value at both existing projects and continually monitors and considers further commercial opportunities.

3.2 Background to Acquisition of Premier Coal – Change of Scale of Activities

On 14 August 2013, the Company announced to ASX that it has entered into an option agreement ( Option Agreement ) with Premier Coking Coal Limited ( Premier Coal ), Premier Coking Coal, LLC ( Premier US ) (a wholly owned subsidiary of Premier Coal), and the Vendors of Premier Coal. Under the Option Agreement the Company was granted an option to acquire all of the shares in Premier Coal ( Premier Coal Option ). On 12 November 2013, the Company announced a variation to the terms of the Option Agreement.

Premier US is party to the Emmaus Option Agreement and the Blackstone Option Agreement, pursuant to which it has the option to acquire the Emmaus Project and the Blackstone Project respectively.

The consideration to be paid to the Vendors for the exercise of the Option will be the issue of 20,000,000 Shares and 20,000,000 Performance Shares. 7,500,000 Shares will also be issued to Emmaus (or its nominee) and 2,500,000 Shares issued to Blackstone (or its nominee) in connection with the Emmaus Option Agreement and Blackstone Option Agreement respectively. The Shares and Performance Shares will be subject to a period of escrow determined by ASX.

Completion of the acquisition of the Premier Coal Shares on exercise of the Option under the Option Agreement is conditional on the following conditions precedent:

(a) the Company conducting technical due diligence investigations in relation to the Emmaus Project, and the leases and the mining information the subject of the Emmaus Project, in accordance with the approved work programme under the Option Agreement and being satisfied with such due diligence results in its absolute discretion;

(b) the Company obtaining all necessary shareholder approvals and regulatory approvals as are required (including under Constitution, the Listing Rules and the Corporations Act) to give effect to the transactions contemplated by the Option Agreement;
(c) ASX approving the terms and conditions or granting an appropriate waiver in respect of the issue of the Performance Shares (this condition has been satisfied);
(d) the parties obtaining any regulatory approvals or consents required in the United States of America ( US ) to the change in control of Premier Coal;
(e) Premier US and Blackstone executing an option and exploration agreement whereby Premier US is granted an option to acquire Coal Lease dated 26 September 2012 held by Marco Land Company, Inc., on terms reasonably acceptable to the Company (this condition has been satisfied);
(f) Premier US executing an agreement for the transfer of the Blackstone Deep Mine Permit on terms reasonably acceptable to the Company (this condition has been satisfied); and
(g) the terms of $200,000 in loans from the Vendors to Premier Coal are varied so that they are only repayable by the issue of Shares to the Vendors at the issue price of the next capital raising completed by the Company to raise not less than $500,000 after the Placement, or at the Purchaser's election by payment in cash following the completion of that next capital raising,

(together, the Conditions ).

The Conditions must be satisfied or waived by 16 December 2013 (or another date agreed by the parties in writing).

The consideration for the Acquisition is partly performance based, in the form of the Performance Shares, which will only convert into Shares upon the achievement of the following milestones prior to the expiry date of the Performance Shares:

(a) the Shares of the Company trading on the ASX at a price of more than $0.20 per Share for a continuous period of at least 30 Business Days; and
(b) either:
(i) the Company making a Decision to Mine and achieving production of not less than 15,000 tons of saleable coal product per month; or
(ii) the Company making a Decision to Construct a processing facility with a production plan that will produce not less than 30,000 tons of saleable coal per month,

on the Emmaus Project or Blackstone Project,

(together the Milestones ).

The Performance Shares expire on the date that is three years after the date of Completion of the Acquisition. To the extent that the Milestones have not been achieved on or before the expiry date, then the Performance Shares will automatically consolidate to a nominal number and convert on a one for one basis to a nominal number of Shares. The full terms and conditions of the Performance Shares are set out in Schedule 1.

The Option Agreement includes standard commercial warranties that are usual for a transaction of this type including warranties from the Nominee Warrantors in relation to Premier Coal, Premier US and their assets.

Completion of the Acquisition will not change the Company’s existing business as a mineral exploration and development company. However, given the size of the Acquisition it will significantly increase the scale of the Company's activities.

Under the terms of the Emmaus Option Agreement on exercise of the option consideration of US$550,000 and 7,500,000 Shares will be paid. Under the terms of the Blackstone Option on exercise of the option consideration of US$105,000 and 2,500,000 Shares will be paid. Please refer to Section 3.3 for further details about Premier Coal and its assets.

In connection with the Acquisition the Company is also proposing to raise funds under the Placement. See Section 7 for further details.

3.3 Background on Premier Coal and its assets

Premier Coal is a New Zealand company, whose wholly owned subsidiary, Premier US, is a US registered and based coal exploration and development company. Premier US is party to the Emmaus Option Agreement and Blackstone Option Agreement, pursuant to which it holds options to acquire the Emmaus Project and the Blackstone Project.

Premier US was formed with the intention of securing the rights to acquire high quality coking coal assets within the Appalachian district of the USA. The company has secured option agreements for two adjacent hard coking coal assets, Emmaus and Blackstone, as well as a deep mine permit to commence an underground operation at Blackstone (and Emmaus subject to a variation to the terms of the permit).

The Emmaus Project covers 4,700 acres across the border of McDowell and Wyoming counties. The Blackstone Project is 1,200 acres and is wholly within McDowell County.

Hard Coking Coal

Coking coal, also referred to as metallurgical coal, is a key feed ingredient to the steelmaking process. After being heated into coke, the coking coal both acts as a fuel for the reaction and as a reduction agent for the iron ore in its process of converting iron ore into steel within a steel mill. Higher quality coals both produce higher quality steels, but also facilitate lower operating costs and higher productivity within a steel mill operation and hence demand a higher price on the coal market.

Project Locations

The projects are located mostly in McDowell County, West Virginia. McDowell county and its surrounding counties are in the Central Appalachian Coal Basin, the historic heart of the coking coal fields of the United States. The area has long provided premium coking coal used by steel makers in the United States and around the world and still a major coal producing district. The coking coal located here is typically of low sulphur and mid‐volatile matter (also known as “mid‐vol”).

The Central Appalachian Coal Basin is the middle basin of three basins that comprise the Appalachian Coal Region of the eastern United States. The central region includes southern West Virginia, eastern Kentucky, northern Tennessee, and southwestern Virginia.

The nearest town to the property is Iaeger, which is on the southern boundary as shown on the following page. Major regional towns include Logan, Beckley and Bluefield which are all one to one and a half hours drive away. The capital of West Virginia, Charleston, is two hours drive from the properties. A map of the project location is shown on the following page in Figure 1.

West Virginia is by far the largest source of US export coal, producing over 30% of all US coal exports. In 2011, West Virginia was the second largest coal producer in the United States, producing 12% of all US production. Of this, 27% was exported, the vast majority being metallurgical coal.

Project History

The project was explored extensively in the late 1970s and during the 1980s. Fitzroy and Cardno (Marshall Miller and Associates, Inc. and Geological Consulting Services, Inc.) have identified 50 historic drill holes to date. Cardno was responsible for observing and analysing prior drilling programs on the site.

Emmaus was last mined in the 1990s by Virginia Crews. The project has been mined previously, almost exclusively from the Gilbert and Red Ash seams. The mine shut down due to the economics of the time. Not unlike a lot of other mines in the area, Emmaus and Blackstone mining sections were typically closed when the coal reached a critical thickness.

Given its effect on mining cost and mining dilution, a large component of economic viability of a coal mine in the Appalachian Basin is driven by the thickness of a coal seam. It is this thickness based mining cut‐off that largely explains the continued existence of potential Coal Resources on both properties. Many mines today are mining seams of similar thicknesses to those identified in historic drill records at Emmaus. Some sections of the mine may have been abandoned due to adverse local mining conditions which can occur in the area, though local mining conditions are generally regarded to be favourable.

Figure 1 - Location of Emmaus and Blackstone

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EMMAUS
BLACKSTONE
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Geology

The Appalachian Basin historically has been subdivided into three coal regions based on regional geological structure and stratigraphy. The Central Appalachian Basin is of Pennsylvanian age and is characterised structurally by broad, northeast‐southwest trending folds typically dipping at less than five degrees. Coal rank is generally medium‐ and high‐ volatile bituminous throughout the central region except in the south‐eastern part of the Southern West Virginian Coal field which is often low‐volatile.

Figure 2 - Northern, Central and Southern Regions of the Appalachian Basin1

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Locally, the Emmaus and Blackstone properties are within the Kanawha and New River formations. The stratigraphy is structurally simple and historic drill data confirms that the prospective coal seams are relatively flat dipping. The lithology comprises mostly sandstone with minor constituents of shale, siltstone and coal.

1 Source: US Geologic Survey ‐ 2000 RESOURCE ASSESSMENT OF SELECTED COAL BEDS AND ZONES IN THE NORTHERN AND CENTRAL APPALACHIAN BASIN COAL REGIONS

Figure 3 - Stratigraphic column of Appalachian basin coal highlighting the target, above drainage seams (in box) and potential upside below

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Targeted Seams

Prospective coal seams that have been identified to date within the leases of Emmaus and Blackstone are the Ben’s Creek, Lower War Eagle, Gilbert, Red Ash (often referred to as Douglas) and Iaeger.

Geologically, the target seams are relatively flat dipping with minimal faulting and are above drainage. Above drainage seams are above the level that seam gas will typically occur (often the low point of local topography)

Many seams in the local area are typically marketed as mid‐volatile. These coals will generally be:

Low Ash (<8%)
Low Sulphur (<1%);
Mid Volatile Matter (23‐29%) and;
High Coal Strength after Reaction (>50%)

Drilling Program

Historically, over 50 drill holes have been completed within the project that Premier has records of. Cardno has historically conducted geophysical logging of exploratory holes at this project and understands the methodology that the project was drilled and sampled under. As

our independent expert, this gives Cardno a head start in assessing the historic drill data in respect to Quality Assurance and Control.

Cardno has designed a 3,600 foot drill program for Fitzroy comprising 8 holes drilling targeting either the Iaeger or Red Ash seams.

Coal seams that are the focus of the current drill program are the Gilbert and Red Ash while the Iaeger seam will be tested in a number of holes for future prospectivity. The Red Ash seam can have minor pinching and swelling within it while the Gilbert seam thickness is known to be more locally consistent.

Future exploration may test upper seams and below drainage seams however these will not be a focus of the drilling program during due diligence. Large, below drainage Coal Resources exist in southern West Virginia. These have not historically been explored at Emmaus, or Blackstone.

Strata Services has been appointed to the program and has mobilised and commenced drilling.

Figure 4 - View of Emmaus property and Due Diligence drill holes

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Processing Requirements

Cardno expects most, if not all, coal will require processing. Thinner areas and in areas with split seams and partings, the coal will carry lower overall yields when washing to a marketable ash content than areas where coal is mined clean from roof to floor.

We will examine our processing options upon finalisation of the existing drilling program and successful completion of the acquisition. In due course, we will appoint a recognised consultant to run appropriate test work and plant design.

In the interim, there are multiple third party wash plants within trucking distance of the project. In due course, Fitzroy will commence discussions with regard to access agreements to facilitate processing prior to having our own plant.

Infrastructure

The district is well serviced by infrastructure required for mine development. Numerous small mines operate in the area and processing options are typically available. Towns, utilities and a well‐trained population are available.

This project is located within a mature coal mining district and has many rail sidings and redundant plant capacity can often be accessed on commercial terms. A rail line runs along the southern boundary of the property and a Norfolk Southern rail yard is within one mile of the Emmaus property boundary. A permitted 40 car rail load out area is within the Emmaus lease and the permit is currently owned by a third party. Fitzroy will endeavour to acquire their permit or over‐bond this area.

Export coal is typically shipped through Norfolk or Baltimore coal terminals.

Figure 5 - rail siding and location map

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Further details about the Emmaus and Blackstone Project leases and commitments are in Schedule 5.

Further information about Premier Coal's assets can be found in the Company's ASX announcements made on 14 August 2013 and 12 November 2013.

3.4 Pro‐forma Balance Sheet

Schedule 3 contains the unaudited balance sheet of the Company at 30 September 2013 and a pro forma adjusted for the effect of the following transactions:

(a) completion of the acquisitions under the Premier Coal Option, Emmaus Option and Blackstone Option;

(b) the issue of the Placement Shares; and

All Share issues have been deemed to occur at an issue price of $0.043 per Share.

3.5 Effect of the Acquisition on the Company

The capital structure of the Company following Completion of the Acquisition and the Placement is set out in Table 1 below [1] :

Table 1

SHARES Current issued Share capital Shares issued to Vendors Shares issued to Emmaus and Blackstone Placement Adviser Shares TOTAL SHARES PERFORMANCE SHARES2 Current Performance Shares issued to Vendors TOTAL PERFORMANCE SHARES OPTIONS Options exercisable at $0.30 TOTAL OPTIONS	47,000,005 20,000,000 10,000,000 20,000,000 4,000,000
	101,000,005
	nil 20,000,000
	20,000,000
	11,000,0003
	11,000,000

1 This assumes that no other Shares are issued prior to Completion of the Acquisition (including as a result of the exercise of Options).

2 Each Performance Share can convert into one Share upon achievement of the Milestones, refer to Section 3.2 and Schedule 1 for further details.

3 5,000,000 Options are exercisable on or before 6 December 2013 and 6,000,000 Options are exercisable on or before 31 December 2015.

The potential dilution to existing Shareholders as a result of the capital structure of the Share issues set out above and following conversion of the Performance Shares (assuming no other Shares are issued) is illustrated in Table 2 below:

Table 2

Table 2
	SHARES ON ISSUE	DILUTION
		%
Current issued Share capital	47,000,005	‐
Share issued to Vendors and Emmaus and Blackstone	30,000,000	63.8%
Shares issued to Vendors and Emmaus and Blackstone	50,000,00	106.3%%
(including Shares on conversion of Performance
Shares

3.6 Advantages of the Acquisition

The Directors are of the view that the following non‐exhaustive list of advantages may be relevant to a Shareholder's decision on how to vote on Resolution 1:

(a) If the Acquisition is approved, Shareholders will be exposed to the potential upside from Premier Coal and its Projects.
(b) The Company will be able to increase its value if it is able to achieve commercial production from the Projects.
(c) The Company will be exposed to new commercial opportunities in the US coal sector
(d) The Company’s ability to raise funds and attract new employees and expertise will be improved.
(e) The Acquisition may encourage new investors in the Company because the Company is acquiring new assets. This improvement in the attractiveness of an investment in the Company may lead to an increased liquidity of Shares and greater trading depth than currently experienced by Shareholders.
(f) Shareholders may be exposed to further debt and equity opportunities that they did not have prior to the Acquisition.

3.7 Disadvantages of the Acquisition

The Directors are of the view that the following non‐exhaustive list of disadvantages may be relevant to a Shareholder's decision on how to vote of Resolution 1:

(a) the Company will be changing the scale of its activities, which may not be consistent with the objectives of Shareholders.
(b) Should the Acquisition be completed, the Company's Shareholders will have their voting power reduced. As such, the ability of the existing Shareholders to influence decisions, including the composition of the Board or the acquisition or disposal of assets will be reduced accordingly.
(c) The Company will be exposed to the risks associated with the change of scale of the Company's activities, or rather associated with Premier Coal's business and operations (refer to Section 3.8 for further information).

3.8 Risk Factors

The Company is currently undertaking the requisite due diligence process (including title, legal, technical and other risks). While this process is undertaken to identify any material risks specific to Premier Coal and its assets, it should be noted that the usual risks associated with mineral exploration and development companies with a small market capitalisation are expected to remain after the completion of due diligence.

Shareholders and investors should also be aware that the Option Agreement to acquire Premier Coal, should the Company exercise the Premier Coal Option, is conditional on a number of events (refer to Section 3.2 above). Accordingly there is a risk that the Acquisition may not be completed.

Investing in a company involves risks of various kinds, some of which are within the realms of influence of the Company and some, arising from external factors, which may be beyond the

control of the Company. A summary of the risks associated with the Acquisition and ongoing development of Premier Coal's assets are outlined in Schedule 4.

3.9 Plans for the Company if the Acquisition is not completed

If the Company does not complete the Acquisition, the Company will continue with its current activities and continue to seek, and undertake due diligence on, new opportunities for growth.

3.10 Directors’ Recommendation in relation to Acquisition

Based on the information available, including the information contained in this Explanatory Memorandum the Directors recommend that Shareholders vote in favour of Resolution 1.

3.11 Forward looking statements

The forward looking statements in the Notice are based on the Company’s current expectations about future events. They are, however, subject to known and unknown risks, uncertainties and assumptions, many of which are outside the control of the Company and its Directors, which could cause actual results, performance or achievements to differ materially from future results, performance or achievements expressed or implied by the forward looking statements in the Notice. These risks include but are not limited to, the risks referred to in 0. Forward looking statements include those containing words such as ‘anticipate’, ‘estimates’, ‘should’, ‘will’, ‘expects’, ‘plans’ or similar expressions.

4. Resolution 1 – Approval of Acquisition of Premier Coal

4.1 General

As outlined in Section 3.2 of this Explanatory Memorandum, the Company has entered into the Option Agreement under which the Company can acquire all of the Premier Coal Shares from the Vendors.

The Option Agreement is subject to the Conditions set out in Section 3.2 above, including the requirement to obtain Shareholder approval.

A detailed description of the proposed Acquisition and Premier Coal's assets and prospects is outlined in Section 3 above.

Resolution 1 seeks Shareholder approval under Listing Rule 7.1 to issue the Consideration Shares to the Vendors, and Shares to Emmaus and Blackstone, in accordance with the Acquisition of Premier Coal pursuant to the Option Agreement.

Resolution 1 is an ordinary resolution. Resolution 1 is subject to the approval of Resolutions 2 and 3.

4.2 Listing Rule 7.1

Listing Rule 7.1 provides that a company must not (subject to specified exceptions), without the approval of shareholders, issue or agree to issue during any 12 month period any equity securities, or other securities with rights to conversion to equity (such as an option), if the number of those securities exceeds 15% of the number of ordinary securities on issue at the commencement of that 12 month period.

Given the Shares and Performance Shares to be issued under Resolution 1 will exceed the 15% threshold and none of the exceptions contained in Listing Rule 7.2 apply, Shareholder approval is required under Listing Rule 7.1.

The following information is provided pursuant to and in accordance with Listing Rule 7.3:

(a) the maximum number of securities to be issued to:
(i) the Vendors is 20,000,000 Shares and 20,000,000 Performance Shares;
(ii) Emmaus or its nominee is 7,500,000 Shares; and
(iii) Blackstone or its nominee is 2,500,000 Shares,

none of whom are related parties of the Company;

(b) the Shares and Performance Shares will be issued no later than 3 months after the date of the Meeting (or such later date to the extent permitted by any ASX waiver or modification of the Listing Rules) and it is intended that the Shares and Performance Shares will be issued on the same date, being the Completion Date. The terms of the Performance Shares remain subject to approval by ASX;
(c) the Shares and Performance Shares will be issued for nil cash consideration as they are being issued as part of the consideration for the Acquisition. Accordingly no funds will be raised from the issue of the Shares and Performance Shares;
(d) none of the Vendors, Emmaus or Blackstone are related parties of the Company; and
(e) the Shares issued will be fully paid ordinary shares in the capital of the Company issued on the same terms and conditions as the Company’s existing Shares, and the Performance Shares will be issue on the terms and conditions set out in Schedule 1.

5. Resolution 2 – Approval of Change in Scale of Activities

5.1 General

Resolution 2 seeks Shareholder approval under Listing Rule 11.1.2 for the significant change in the scale of the Company's activities resulting from the Acquisition. Resolution 2 is subject to the approval of Resolutions 1 and 3.

5.2 Listing Rule 11.1.2

Listing Rule 11.1 provides that where an entity proposes to make a significant change, either directly or indirectly, to the nature or scale of its activities, it must provide full details to ASX as soon as practicable and comply with the following:

(a) provide to ASX information regarding the change and its effect on future potential earnings, and any information that ASX asks for;
(b) if ASX requires, obtains the approval of holders of its shares and any requirements of ASX in relation to the notice of meeting (the notice of meeting must include a voting exclusion statement); and

(c) if ASX requires, meet the requirements of Chapters 1 and 2 of the Listing Rules as if the Company were applying for admission to the official list of ASX.

ASX has indicated to the Company that given the change in the scale of the Company’s activities resulting from the Acquisition it requires the Company to obtain Shareholder approval. The Company is not required to re‐comply with the admission requirements set out in Chapters 1 and 2 of the Listing Rules. A voting exclusion is included in the Notice.

6. Resolution 3 – Approval of Performance Shares

The Company seeks Shareholder approval to create the Performance Shares as a new class of Shares on the terms and conditions in Schedule 1.

Resolution 3 is a special resolution. Resolution 3 is subject to the passing of Resolutions 1 and 2.

Under clauses 2.1 and 2.2 of the Constitution and, subject to the Corporations Act, the ASX Listing Rules and the Constitution, the Directors may at any time issue such number of shares either as ordinary shares or shares of a named class or classes (being either an existing class or a new class) at the issue price that the Directors determine and with such preferred, deferred, or other special rights or such restrictions, whether with regard to dividend, voting, return of capital or otherwise, as the Directors shall, in their absolute discretion, determine.

Section 246C(5) of the Corporations Act provides that if a company has one class of share and seeks to issue a new class of share, such issue is taken to vary the rights attached to the shares already issued.

Under section 246B(1) of the Corporations Act, if a company has a constitution which sets out the procedure for varying or cancelling (in the case of a company with share capital) rights attached to shares in a class of shares, those rights may be varied or cancelled only in accordance with the procedure.

In accordance with clause 2.3 of the Constitution, if at any time the share capital of the Company is divided into different classes of shares, the rights attached to any class (unless otherwise provided by the terms of issue of the shares of that class) may be varied, whether or not the Company is being wound up:

(a) with the consent in writing of the holders of three quarters of the issued shares of that class; or
(b) authorised by a special resolution passed at a separate meeting of the holders of the shares of the class.

Accordingly, the Company seeks approval from Shareholders for the issue of the Performance Shares as a new class of shares on the terms set out in Schedule 1 of this Explanatory Memorandum.

The Company is also seeking approval in Resolution 1 from Shareholders to issue Performance Shares to the Vendors. The terms of the Performance Shares have been approved by ASX.

7. Resolution 4 – Authority to Issue Placement Shares

Resolution 4 seeks Shareholder approval pursuant to Listing Rule 7.1 for the allotment and issue of the Placement Shares each at an issue price set out below. The Company intends to

undertake a Placement to sophisticated and professional investors. The funds raised from the Placement will be used for the initial development of the Projects and to increase the Company's existing working capital.

A summary of Listing Rule 7.1 is provided in section 4.2. Shareholder approval is being sought under Listing Rule 7.1 so that the issue will not reduce the Company's 15% placement capacity under Listing Rule 7.1.

Resolution 4 is an ordinary resolution and is subject to the passing of Resolutions 1, 2 and 3.

7.1 Specific information required by Listing Rule 7.3

The following information is provided pursuant to and in accordance with Listing Rule 7.3:

(a) the maximum number of Shares the Company intends to issue is 20,000,000;
(b) the Company will issue and allot the Placement Shares no later than three months after the date of the Meeting (or such longer period of time as ASX may in its discretion allow) and it is intended that all of the Placement Shares will be issued on the same date;
(c) the issue price for the Placement Shares will be a price that is not less than 80% of the average market price for Shares calculated over the 5 days on which sales in the Shares are recorded before the day on which the issue is made;
(d) the Placement Shares will be issued to sophisticated and professional investors who are not related parties of the Company;
(e) the Shares to be issued are fully paid ordinary shares and will rank equally in all respects with the Company’s existing Shares on issue; and
(f) the funds raised from the Placement will be used for the initial development of the Projects acquired under the Acquisition and to increase the Company's existing working capital.

8. Resolution 5 – Authority to Issue Adviser Shares – Argonaut

8.1 General

Resolution 5 seeks Shareholder approval pursuant to Listing Rule 7.1 for the allotment and issue of Adviser Shares to Argonaut, in consideration for corporate advisory services provided by Argonaut in connection with the Acquisition.

Resolution 5 is an ordinary resolution and is subject to the passing of Resolutions 1, 2 and 3.

8.2 Specific information required by Listing Rule 7.3

A summary of Listing Rule 7.1 is provided in section 4.2. Shareholder approval is being sought under Listing Rule 7.1 so that the issue to Argonaut will not reduce the Company's 15% placement capacity under Listing Rule 7.1.

The following information is provided pursuant to and in accordance with Listing Rule 7.3:

(a) the maximum number of Shares to be issued to Argonaut is 2,000,000 Shares;

(b) the Shares will be issued no later than 3 months after the date of the Meeting (or such later date to the extent permitted by any ASX waiver or modification of the Listing Rules) and it is intended that the Shares will be issued on the same date;
(c) the Shares will be issued for nil cash consideration as they are being issued as the consideration for corporate advisory services provided by Argonaut. Accordingly no funds will be raised from the issue of the Shares;
(d) the Shares will be issued to Argonaut; and
(e) the Shares issued will be fully paid ordinary shares in the capital of the Company issued on the same terms and conditions as the Company’s existing Shares.

9. Resolution 6 – Authority to Issue Adviser Shares – Forrest Capital

9.1 General

Resolution 6 seeks Shareholder approval pursuant to Listing Rule 10.11 for the allotment and issue of Adviser Shares to Forrest Capital, in consideration for corporate advisory services provided by Forrest Capital in connection with the Acquisition.

Listing Rule 10.11 provides that a company must not (subject to specified exceptions) issue or agree to issue equity securities to a related party without the approval of shareholders.

Forrest Capital is a related party of the Company as it is associated with Mr Tom Henderson, a Director of the Company.

Shareholder approval is accordingly required under Listing Rule 10.11 for the issue of Shares to Forrest Capital. If approval is given under Listing Rule 10.11, Shareholder approval is not required under Listing Rule 7.1.

Shareholders should note that if the issue of the Adviser Shares to Forrest Capital is not approved then the Company will be required to pay the advisory fee in cash in the amount of $125,000.

Resolution 6 is an ordinary resolution and is subject to the passing of Resolutions 1, 2 and 3.

9.2 Specific information required by Listing Rule 10.13

The following information is provided pursuant to and in accordance with Listing Rule 10.13:

(a) the maximum number of Shares to be issued to Forrest Capital is 2,000,000 Shares;
(b) Forrest Capital is associated with Mr Tom Henderson, a Director of the Company;
(c) the Shares will be issued no later than 1 month after the date of the Meeting (or such later date to the extent permitted by any ASX waiver or modification of the Listing Rules) and it is intended that the Shares will be issued on the same date, being the date on which Completion occurs;
(d) the Shares will be issued for nil cash consideration as they are being issued as the consideration for corporate advisory services provided by Forrest Capital. Accordingly no funds will be raised from the issue of the Shares;

(e) the Shares issued will be fully paid ordinary shares in the capital of the Company issued on the same terms and conditions as the Company’s existing Shares.

10. Resolution 7 – Adoption of Fitzroy Resources Employee Share Acquisition Plan

10.1 Introduction

Resolution 7 seeks Shareholder approval for the establishment of the Fitzroy Resources Employee Share Acquisition Plan ( Share Plan ) for the purposes of the Corporations Act, Listing Rule 7.2 (Exception 9) and for all other purposes.

Resolution 7 is an ordinary resolution.

The Board has the view that the most effective way to align the interests of the eligible Employees and Shareholders of the Company is for the Employees to be Shareholders.

The aim of this plan is to allow the Board to assist eligible Employees, who in the Board’s opinion are dedicated and will provide ongoing commitment and effort to the Company. Eligible Employees are full‐time or permanent part‐time Employees of the Company or its subsidiaries (which includes Directors). The Company intends to loan funds to certain eligible Employees in order to purchase Shares under the Share Plan. The Board will determine on a case by case basis whether an Employee is eligible for a loan and will determine the loan terms and conditions.

The key features of the Share Plan and the loan are as follows:

(a) The Board will determine the number of Plan Shares to be Allocated to eligible Employees and the issue price of the Plan Shares in its sole discretion.
(b) The Company will be permitted to loan funds to eligible Employees to purchase Plan Shares.
(c) The loan will be a limited recourse loan provided the Employee remains employed by the Company, or a subsidiary of the Company, for a period, or periods, as determined by the Board.
(d) The loan will be interest free provided the Employee remains employed by the Company, or a subsidiary of the Company, for a period, or periods, as determined by the Board.
(e) In the event that the Employee leaves before the interest free period determined by the Board, interest will be charged equal to the market rate of interest that would have accrued on the loan from the date of advance of the funds to the repayment date.
(f) The Plan Shares will be Allocated at a small discount either through the issue of new Shares or the purchase of Shares on‐market.
(g) Plan Shares may be subject to a sale restriction for a certain period.
(h) A Trust will be set up as the holding mechanism for Plan Shares Allocated under the Share Plan. The Trustee will hold the Plan Shares on trust for the eligible Employee until the loan is repaid (or any other vesting conditions are satisfied).

(i) During the term of the loan, dividends will be retained by the Trustee and offset against the Employee's outstanding loan balance. A portion of the dividend may be released to the Employee to cover any tax liability as a result of the dividend.
(j) Subject to the Corporations Act and the Listing Rules, the Board will have the power to amend the Share Plan as it sees fit.

A detailed overview of the terms of the Share Plan is attached in Schedule 2.

10.2 Corporations Act

Section 259B(1) of the Corporations Act prohibits a company from taking security over its shares except as permitted by section 259B(2) or 259B(3). Section 259B(2) states that a company may take security over shares in itself under an employee share scheme that has been approved by a resolution passed at a general meeting of the company.

Section 260A(1) of the Corporations Act prohibits a company from financially assisting a person to acquire shares in itself except in specific circumstances which include if the assistance is exempted under section 260(C). Section 260(C)(4) provides for a special exemption for approved employee share schemes and states that financial assistance is exempted from section 260(A) if it is given under an employee share scheme that has been approved by a resolution passed at a general meeting of the company.

Accordingly Shareholder approval is sought for Resolution 7 to ensure compliance with these sections of the Corporations Act.

10.3 Specific Information Required by Listing Rule 7.2 Exception 9(b)

In accordance with the requirements of Listing Rule 7.2 Exception 9(b) the following information is provided:

(a) The material terms of the Share Plan are summarised above.
(b) This is the first approval sought under Listing Rule 7.2 Exception 9 with respect to the Share Plan.
(c) No securities have been issued under the Share Plan.

11. Resolution 8 – Authority to Allocate Plan Shares to a Director – Mr Russell Lynton‐Brown

11.1 Background

The Company proposes to Allocate a total of 500,000 Plan Shares to Mr Russell Lynton‐Brown, a Non‐Executive Director of the Company, under the Share Plan.

The principal terms of the Share Plan are summarised in Schedule 2.

The Plan Shares will be Allocated at a $1,000 discount to the volume weighted average of the prices at which Shares were traded on the ASX during the five day period up to and including the date of Allocation of the Plan Shares.

The Company will provide a loan for the entire issue price of the Plan Shares. The principal terms of the loan are summarised in Schedule 2.

In the Company’s present circumstances, the Board considers that the incentive to Mr Lynton‐ Brown that will be represented by the Allocation of these Plan Shares, are a cost effective and efficient reward for the Company to make to appropriately incentivise the continued performance of Mr Lynton‐Brown and are consistent with the strategic goals and targets of the Company.

The Board considers that the Allocation of 500,000 Plan Shares to Mr Lynton‐Brown will align his interests with the interests of Shareholders. It is also usual that junior exploration companies remunerate their directors by way of share incentive plans in order to preserve cash and maximise exploration activities.

Resolution 8 is an ordinary resolution and is subject to the passing of Resolution 7.

11.2 Listing Rule 10.14

Shareholder approval is required under Listing Rule 10.14 for the proposed Allocation of the Plan Shares to Mr Lynton‐Brown and funding of the Plan Shares because Mr Lynton‐Brown is a related party of the Company.

As Shareholder approval is sought under Listing Rule 10.14, approval under Listing Rule 7.1 is not required. Accordingly, the Allocation of Plan Shares to Mr Lynton‐Brown will not reduce the Company's 15% capacity for the purposes of Listing Rule 7.1

11.3 Specific information required under Listing Rule 10.15

Listing Rule 10.15 requires that the following information be provided to Shareholders for the purpose of obtaining Shareholder approval for the Allocation of the Plan Shares:

(a) The Plan Shares will be Allocated to Mr Lynton‐Brown indirectly through a Trust established under the Share Plan.
(b) The maximum number of Plan Shares that may be Allocated to Mr Lynton‐Brown pursuant to Resolution 8 is 500,000.
(c) The Plan Shares will be Allocated at a total discount of $1,000 to the total value of the Plan Shares Allocated calculated by multiplying the volume weighted average of the prices at which Shares were traded on the ASX during the five day period up to and including the date of Allocation of the Plan Shares. By way of example:

Volume weighted average of Share prices	$0.043
Number of Plan Shares to be Allocated	500,000
Value of Plan Shares Allocated	$21,500
Discount	$1,000
Value at which Plan Shares are Allocated and loan amount	$20,500

(d) The Plan Shares will be granted with a sales restriction for 12 months.

If the Participant leaves prior to the relevant Sale Restriction Date passing, the full loan will become repayable and interest will be charged on the portion of the loan corresponding to the class, or classes, of Plan Shares for which the relevant Sale Restriction Date has not passed.

(e) There have not been any Plan Shares Allocated under the Share Plan to date;
(f) Under the Share Plan, only Employees (as defined in Section 12 of this Notice) are entitled to participate in the Share Plan. Mr Lynton‐Brown has been determined to be an Employee for the purposes of the Share Plan.
(g) A voting exclusion statement is included in the Notice.
(h) The material terms of the loan in relation to the Share Plan are detailed in section 3 of Schedule 2 of this Notice.
(i) The Company will Allocate the Plan Shares no later than 12 months after the date of the Meeting (or such later date as permitted by any ASX waiver or modification of the Listing Rules).

12. Definitions

$ means Australian Dollars.

Adviser Shares has the meaning in Resolutions 5 and 6.

Acquisition means the acquisition of Premier Coal by the exercise of the Premier Coal Option by the Company.

Allocation means the allocation of a beneficial interest in newly issued Shares to a Participant by the Trustee or the transfer of a beneficial interest in Shares already held by the Trustee to a Participant following instruction from the Company in accordance with the terms of an Invitation and Allocate and Allocated have the corresponding meaning.

Argonaut means Argonaut Securities Pty Ltd.

ASIC means Australian Securities and Investments Commission.

ASX means ASX Limited (ACN 008 624 691) and, where the context permits, the Australian Securities Exchange operated by ASX.

Blackstone means Blackstone Energy Corporation, a company incorporated in West Virginia, US.

Blackstone Option Agreement means the option agreement (as varied) between Blackstone and Premier US, pursuant to which Premier US is granted an option to acquire the Blackstone Project.

Blackstone Project means a lease covering approximately 1,200 acres within McDowell County, West Virginia, USA that is prospective for mid‐volatile hard coking coal that is being acquired by Premier US under the Blackstone Option Agreement..

Board means the board of Directors.

Chairman means the chairman of this Meeting.

Closely Related Party has the meaning in section 9 of the Corporations Act.

Completion means the completion of the sale and purchase of Premier Coal in accordance with the Option Agreement.

Completion Date means the date on which Completion occurs.

Consideration Shares means the Shares and Performance Shares to be issued to the Vendors under the Acquisition.

Constitution means the current constitution of the Company.

Corporations Act means the Corporations Act 2001 (Cth).

Decision to Mine means a decision to mine being taken by the Company in respect of a deposit based on a positive Feasibility Study and in respect of which all necessary approvals and licenses to commence operations have been obtained and finance to achieve steady state production has been obtained and become unconditional.

Decision to Construct means a decision to construct being taken by the Purchaser in respect of a coal processing facility based on a positive Feasibility Study and in respect of which all necessary approvals and licenses to commence operations have been obtained and finance to achieve steady state production has been obtained and become unconditional.

Director means a director of the Company.

Emmaus means Emmaus Partners, LLC, a company incorporated in West Virginia, US.

Emmaus Option Agreement means the option agreement (as varied) between Emmaus and Premier US, pursuant to which Premier US is granted an option to acquire the Emmaus Project.

Emmaus Project means the 4 leases covering approximately 4700 acres within McDowell and Wyoming counties, West Virginia, USA that is prospective for mid‐volatile hard coking coal that are being acquired by Premier US under the Emmaus Option Agreement.

Employee means a person who is a full‐time or permanent part‐time employee or officer or director of the Company and for whom the Company, or subsidiary of the Company, is required to deduct PAYG withholding payments under section 12‐35, 12‐40 or 12‐45 of schedule 1 to the Taxation Administration Act 1953.

Explanatory Memorandum means the explanatory memorandum attached to the Notice.

Feasibility Study means a formal technical, resource and project development study which assesses the viability of developing and mining a deposit which is sufficient (by reference to prevailing industry standards) to support a decision to mine and obtain finance.

Forrest Capital means Forrest Capital Pty Ltd.

Key Management Personnel means a person having authority and responsibility for planning, directing and controlling the activities of the Company, directly or indirectly, including any Director (whether executive or otherwise) of the Company.

Listing Rules means the listing rules of ASX.

Meeting has the meaning in the introductory paragraph of the Notice.

Milestones means the milestones to be achieved in order for the Performance Shares to convert into Shares, as set out in Item 1 of the terms and conditions of the Performance Shares set out in Schedule 1.

Nominee means each party that has a beneficial interest in the Premier Coal Shares.

Nominee Warrantor means each Nominee that has a beneficial interest in over 10% of the Premier Coal Shares.

Notice means this notice of meeting.

Option means an option to acquire a Share.

Option Agreement means the option agreement between the Company, the Vendors, Premier Coal and Premier US (as varied) under which the Company is acquiring Premier Coal.

Performance Share means a performance share convertible into a Share upon achievement of the relevant milestone, issued on the terms and conditions set out in Schedule 1.

Placement has the meaning in Resolution 4.

Placement Shares has the meaning in Resolution 4.

Plan Shares means Shares Allocated to a Participant under the Share Plan.

Premier Coal means Premier Coking Coal Limited (4273058) a company incorporated in New Zealand.

Premier Coal Option means the option to acquire Premier Coal granted to the Company under the Option Agreement.

Premier Coal Share means a fully paid ordinary share in the capital of Premier Coal.

Premier US means Premier Coking Coal, LLC, a company incorporated in Delaware, US.

Projects means the Emmaus Project and the Blackstone Project.

Proxy Form means the proxy form attached to the Notice.

Resolution means a resolution contained in this Notice.

Schedule means a schedule to this Notice.

Section means a section contained in this Explanatory Memorandum.

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

Shareholder means a shareholder of the Company.

Share Plan has the meaning given in Section 10.1.

Share Plan Rules means the rules of the Share Plan.

Trust means the trust established by the Company for the purpose of acquiring, holding and selling the Plan Shares on behalf of Participants.

Trustee means the trustee, being a wholly owned subsidiary of the Company, appointed for the purposes of the Share Plan.

US or United States means the United States of America.

Vendors means the shareholders of Premier Coal being Lava Limited (or its nominees) and Argonaut.

Wheelage means a fee, like a royalty, charged for transporting coal through a property lease.

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

In this Notice, words importing the singular include the plural and vice versa.

Schedule 1 –Terms and Conditions of Performance Shares

For the purpose of these terms and conditions:

Blackstone Option Agreement means the option agreement (as varied) between Blackstone Energy Corporation and Premier US, pursuant to which Premier US is granted an option to acquire the Blackstone Project.

Emmaus Option Agreement means the option agreement (as varied) between Emmaus Partners LLC and Premier US, pursuant to which Premier US is granted an option to acquire the Emmaus Project.

Option Agreement means the option agreement between the Company and the shareholders of Premier Coal.

Company means Fitzroy Resources Limited ACN 145 590 110.

Fitzroy Share means a fully paid ordinary share in the Company.

Premier Coal means Premier Coking Coal Limited.

Premier US means Premier Coking Coal LLC.

Performance Shares

Conversion of Performance Shares
(a) ( Conversion on achievement of Milestones ) Subject to paragraph 2(a), on the achievement of the following milestones the Performance Shares will convert into Fitzroy Shares on a one for one basis:
- (i) the Shares of the Company trading on the ASX at a price of more than $0.20 per Share for a continuous period of at least 30 Business Days; and
- (ii) either:
  - (A) the Purchaser making a Decision to Mine and achieving production of not less than 15,000 tons of saleable coal product per month; or
  - (B) the Purchaser making a Decision to Construct a processing facility with a production plan that will produce not less than 30,000 tons of saleable coal per month,

on the Emmaus Project or Blackstone Project,

(together the Milestones ).

For the purposes of paragraph 1(a)(ii) the following terms have the following meanings:

  - (iii) **Decision to Mine** means a decision to mine being taken by the Company in respect of a deposit based on a positive Feasibility Study and in respect of which all necessary approvals and licenses to commence operations have been obtained and finance to achieve steady state production has been obtained and become unconditional;

  - (iv) **Feasibility Study** means a formal technical, resource and project development study which assesses the viability of developing and mining a deposit which is sufficient (by reference to prevailing industry standards) to support a decision to mine and obtain finance; and

  - (v) **Decision to Construct** means a decision to construct being taken by the Purchaser in respect of a coal processing facility based on a positive Feasibility Study and in respect of which all necessary approvals and licenses to commence operations have been obtained and finance to achieve steady state production has been obtained and become unconditional.

(b) ( Expiry ) The Milestones must be achieved on or before 5.00 pm on the date which is three years after the date of completion of the sale and purchase of the shares in Premier Coal on exercise of the option under the Option Agreement ( Expiry Date ).
(c) ( Conversion on change of control ) There is no right of conversion of the Performance Shares if there is a change in control in relation to the Company prior to the conversion of the Performance Shares.
(d) ( No conversion ) To the extent that Performance Shares have not converted into Fitzroy Shares on or before the Expiry Date, then all such unconverted Performance Shares held by each holder ( Holder ) will automatically consolidate into one Performance Share and will then convert into one Fitzroy Share.
(e) ( Conversion procedure ) The Company will issue a Holder with a new holding statement for the Fitzroy Share or Fitzroy Shares as soon as practicable following the conversion of each Performance Share.
(f) ( Ranking of shares ) Each Fitzroy Share into which the Performance Shares will convert will upon issue:
- (i) rank equally in all respects (including, without limitation, rights relating to dividends) with other issued Fitzroy Shares;
- (ii) be issued credited as fully paid;
- (iii) be duly authorised and issued by all necessary corporate action; and
- (iv) be allotted and issued free from all liens, charges and encumbrances whether known about or not including statutory and other pre‐emption rights and any transfer restrictions.
Takeover Provisions
(a) If the conversion of Performance Shares (or part thereof) under paragraph 1(a) would result in any person being in contravention of section 606(1) of the

Corporations Act then the conversion of each Performance Share that would cause the contravention shall be deferred until such time or times thereafter that the conversion would not result in a contravention of section 606(1). Following a deferment under this paragraph 2(a), the Company shall at all times be required to convert that number of Performance Shares that would not result in a contravention of section 606(1).

(b) The Performance Shareholders shall give notification to the Company in writing if they consider that the conversion of Performance Shares (or part thereof) under paragraph 1(a) may result in the contravention of section 606(1) failing which the Company shall assume that the conversion of Performance Shares (or part thereof) under paragraph 1(a) will not result in any person being in contravention of section 606(1).
(c) The Company may (but is not obliged to) by written notice request the Performance Shareholders to give notification to the Company in writing within seven (7) days if they consider that the conversion of Performance Shares (or part thereof) under paragraph 1(a) may result in the contravention of section 606(1). If the Performance Shareholders do not give notification to the Company within seven (7) days that they consider the conversion of Performance Shares (or part thereof) under paragraph 1(a) may result in the contravention of section 606(1) then the Company shall assume that the conversion of Performance Shares (or part thereof) under paragraph 1(a) will not result in any person being in contravention of section 606(1).
Rights attaching to Performance Shares
(a) ( Share capital ) Each Performance Share is a share in the capital of the Company.
(b) ( General meetings ) Each Performance Share confers on a Holder the right to receive notices of general meetings and financial reports and accounts of the Company that are circulated to shareholders. A Holder has the right to attend general meetings of shareholders of the Company.
(c) ( No Voting rights ) A Performance Share does not entitle a Holder to vote on any resolutions proposed at a general meeting of shareholders of the Company.
(d) ( No dividend rights ) A Performance Share does not entitle a Holder to any dividends.
(e) ( Rights on winding up ) Each Performance Share entitles a Holder to participate in the surplus profits or assets of the Company upon winding up of the Company, but only to the extent of $0.0001 per Performance Share.
(f) ( Not transferable ) A Performance Share is not transferable.
(g) ( Reorganisation of capital ) If there is a re‐organisation (including, without limitation, consolidation, sub‐division, reduction or return) of the issued capital of the Company, the Performance Shares will be varied (as appropriate) in the same manner as the issued capital of the Company and in accordance with the ASX Listing Rules.
(h) ( Quotation of shares on conversion ) An application will be made by the Company to ASX Limited for official quotation of the Fitzroy Shares issued upon the conversion of each Performance Share within the time period required by the ASX Listing Rules.

(i) ( Participation in entitlements and bonus issues ) A Performance Share does not entitle a Holder to participate in new issues of capital offered to holders of Fitzroy Shares, such as bonus issues and entitlement issues.
(j) ( No other rights ) A Performance Share does not give a Holder any other 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.

Schedule 2 – Summary of the Fitzroy Resources Employee Share Acquisition Plan

Outline of Operation of the Share Plan

The objective of the Plan is to provide an incentive to Employees to share in the performance of the Company by the Company assisting Employees to acquire Shares under the Plan.

The Company will set up the Trust (as the mechanism for acquiring, holding and selling Shares under the Plan on behalf of Employees participating in the Plan). The Trustee will be bound by the rules of the Plan and a trust deed appointing and giving powers to the Trustee.

The Company will Allocate Shares to Employees in accordance with an invitation to participate. When an Employee accepts an Invitation and is Allocated Shares he becomes a Participant. The acquisition of the Plan Shares will be financed by a loan from the Company to a Participant.

The Company will Allocate Plan Shares to Employees, subject to specified restrictions.

At the Company’s sole discretion, the Plan Shares to be Allocated to Participants will be acquired by the Trustee on the ASX market or issued by the Company.

An offer of Plan Shares may only be made under the Plan if the number of Plan Shares when aggregated with:

(a) the number of Plan Shares which would be issued if an offer pursuant to the Plan was to be accepted; and
(b) the number of Plan Shares issued during the previous 5 years pursuant to the Plan (or any other incentive scheme),

but disregarding an offer made, or Plan Shares issued by way of or as a result of:

(c) an offer to a person situated at the time of receipt of the offer outside Australia;
(d) an offer that did not need disclosure to investors because of section 708 of the Corporations Act; or
(e) an offer made under a disclosure documents,

does not exceed 5% (or such other maximum permitted under any ASIC Class Order providing relief from the disclosure regime of the Corporations Act) of the total number of issued Shares as at the time of the offer. For the avoidance of doubt, where an offer of Plan Shares lapses without being accepted, the Plan Shares concerned shall be ignored in the above calculation.

Terms and Conditions of the Share Plan and terms on which Invitations may be made

Invitations will be made to Participants on such terms and conditions as the Board in its absolute discretion determines. Invitations will generally be made to Participants on terms and conditions including the following:

(a) An Invitation may specify that the Plan Shares to be Allocated under the Plan will be:
(i) acquired by the Trustee as a result of an issue of new Shares;
(ii) acquired by the Trustee on market;

(iii) Plan Shares held by the Trustee but which have not been Allocated to a Participant; or
(iv) acquired by the Trustee off‐market generally or from another Participant who is disposing of Shares in accordance with any restrictions.

The Trustee may acquire Plan Shares in advance of making an Allocation using short term loans funds extended by the Company to the Trustee. Such loans will be repaid from the payment on Allocation of Plan Shares to the Participant.

(b) If there are more acceptances than Plan Shares available, the Board can scale back Allocations under the Invitation at its absolute discretion.
(c) It is the current intention of the Board that Plan Shares will be Allocated at a nominal discount to the volume weighted average of the prices at which the Shares were traded on the ASX during the week leading up to and including the date of Allocation of the Plan Shares unless otherwise determined by the Board, or another acceptable taxation valuation method for shares issued under an employee share scheme (as determined by the Board). The Board can determine to Allocate Plan Shares at a greater discount.
(d) Participants must pay for the Plan Shares Allocated to them with the proceeds of the loan provided to them by the Company.
(e) A loan may be provided on such terms as determined by the Board. The Company currently proposes to loan funds to Participants on the terms in item 3 below.
(f) Participants have no right to, or an interest in, Plan Shares under the Plan until the Plan Shares have been Allocated to them. A Participant has no right against the Company if Plan Shares under the Plan are not Allocated to them.
(g) Allocations of Plan Shares under the Plan may be made progressively at such times as and when such Plan Shares become available.
(h) If, for whatever reason, there are insufficient Plan Shares to satisfy the Allocations there is no requirement on the Company or the Trustee to Allocate the Plan Shares.
(i) No Allocation of Plan Shares will be made to Participants to the extent that it would contravene the Constitution, Listing Rules, the Corporations Act or any other applicable law.
(j) On Allocation, Participants will be entitled to exercise all rights of a shareholder attaching to the Plan Shares, subject to specified terms and restrictions.
(k) The Company may impose such restrictions on Plan Shares under the Plan as it sees fit for such period as it sees fit. The Plan provides for the release of restrictions in the event of a change of control event of the Company.
(l) Participants may request the Trustee to sell their Plan Shares if there are no restrictions on the Plan Shares and the value of the Plan Shares is greater than the loan. In this event the Trustee must sell the Plan Shares and the net proceeds of sale will be used to repay the loan and the balance, if any, paid to the Participant. In such circumstances the Trustee may sell the Plan Shares on market or off market or acquire the shares itself to be held pending their future Allocation under the Plan.

(m) The Invitation is personal to a Participant and may only be accepted by the Participant.
(n) Subject to the Corporations Act and the Listing Rules, the Board will have the power to amend the Plan as it sees fit.
Material terms of the loan

If the Company provides a loan to a Participant such Participant must accept the terms of the loan as part of the Invitation. The loan may only be used to pay for the Allocation of Plan Shares under the Plan.

The terms and conditions of the loan will be determined by the Board in its discretion.

A Participant may, at any time, repay part all or part of the amount of the loan.

Repayment of the loan does not operate to remove the sale restrictions which will continue to apply during the specified restriction period.

Until repayment of the loan in full, Participants have no right to have the Plan Shares transferred to them.

In the event that the Participant leaves within the restricted period determined by the Board, the loan must be repaid and interest will be charged equal to the market rate of interest that would have accrued on the loan from the date of advance of the fund to the date the loan amount is repaid in full.

If, after the relevant restricted period, the Participant ceases to be employed by the Company, or requests the Trustee to sell the Plan Shares Allocated to the Participant and the value of Plan Shares Allocated to the Participant under the Plan is greater than the loan, the Participant must immediately pay the Company the loan in full and the Trustee will transfer the Plan Shares to the Participant.

If, after the relevant restricted period, the Participant ceases to be employed by the Company, or requests the Trustee to sell the Plan Shares Allocated to the Participant and the value of Plan Shares Allocated to the Participant under the Plan is less than the loan, the Trustee will transfer the Plan Shares to the Company in full satisfaction of the loan.

Dividends declared on Plan Shares will be used to repay the loan. A portion of the dividend, determined by the Company, will be paid to the Participant so that the Participant can pay any tax liability in respect of the dividend paid.

If the Participant does not repay the loan as required by the terms of the loan then the Trustee is authorised to sell the Participant’s Plan Shares on market or off‐market or may acquire them himself as Trustee for the purposes of the Plan. The net proceeds of sale will be used to repay the loan and the balance, if any, paid to the Participant.

The Company intends to make provisions in the loan in the event of a special circumstance, such as death or permanent incapacity of the Participant, occurring.

If a takeover is made or change of control event occurs made then restrictions in respect of the Participant’s Plan Shares may be waived. In such circumstances the Participant shall be entitled to authorise the Trustee to sell the Participant’s Plan Shares and the net proceeds of sale will be used to repay the loan and the balance, if any, paid to the Participant. If the takeover is not successful or the change of control event does not occur and the Plan Shares are not sold then the restrictions will continue to apply.

While the loan remains outstanding a Participant is not entitled to participate in any dividend reinvestment plan of the Company.

Subject to the Corporations Act and the Listing Rules, the Board will have the power to amend the terms and conditions of any loan as it sees fit.

Schedule 3 – Pro Forma Balance Sheet

Assets Current Assets Cash and Cash Equivalents Trade and other receivables Total Current Assets Non‐Current Assets Property, Plant and equipment Exploration and evaluation expenditure Aust Exploration and evaluation expenditure USA Total non‐current assets Total Assets Current Liabilities Trade and other payables Payment for permit acquisition Total Current Liabilities Non‐Current Liabilities Shareholder Loans Total Non‐Current Liabilities Total Liabilities Net assets Shareholders' Equity Issued capital Option Reserve Accumulated losses Total shareholders' equity	Proforma Balance Sheet	Actual Balance Sheet



	Sep‐13	Sep‐13
	1,660,244 1,456,844 45 45
	1,660,289 1,456,889
	20,509 20,509 1,744,182 1,744,182 2,695,498 378,498 4,460,188 2,143,188
	6,120,478 3,600,078
	33,525 33,525 50,000 -
	83,525 33,525
	200,000 -
	200,000 -
	283,525 33,525

	5,836,953 3,566,553
	8,999,837 6,729,437 403,800 403,800 ( 3,566,684) (3,566,684)
	5,836,953 3,566,553

Schedule 4 – Risk Factors of the Acquisition

4. Introduction

There are a number of risks associated with the Acquisition that may have an impact on the financial returns received by Shareholders. These risks are important for Shareholders to understand.

Shareholders are already exposed to a number of risks through their existing shareholding in the Company. A number of these risks are inherent in investing in securities generally and also inherent in any mining company such as the Company.

The risk factors include, but are not limited to, those detailed below. Additional risks not presently known to the Company, or if known, not considered material, may also have an adverse impact.

The Directors believe that the advantages of the Acquisition outweigh the associated extent of the risks.

2.

Risks specific to Premier Coal

(a) Coal Thickness

Coal thickness can vary locally and if mining to a minimum thickness, this can result in additional dilution, adversely affecting transportation and processing costs. 50 historic holes have been identified at the property and Premier is in the process of drilling further confirmatory and infill holes to gain greater knowledge of the coal seams but local conditions can change within short distances. When mining, if the thickness of the coal is thinner than anticipated, the Emmaus and Blackstone financial viability may be adversely affected.

(b) Roof and floor conditions

Local conditions can vary. Hard or soft contacts above and below the seam can create difficult mining conditions. When mining at mining thicknesses greater than the coal seam thickness, there are times when the roof can either be difficult to support, or slow and expensive to mine through. In these times, coal recovery, coal dilution and mining productivity may suffer, adversely affecting the value and potentially viability of a particular mining area.

(c) Permits at Emmaus and Blackstone

In order to commence mining, both the Emmaus and Blackstone leases will require a permit to mine underground referred to as a Deep Mine Permit. Premier has signed an option to acquire an existing deep mine permit on the northern boundary of the Blackstone lease to access the Red Ash coal at Blackstone. Failure to complete this transaction or to obtain a permit of this type in a timely fashion may cause lengthy delays to mine commencement.

There are two further permits owned by a third party on the Emmaus lease that would allow processing, rail loading and refuse disposal if acquired or over‐bonded by Premier. Over‐ bonding is a process available only to a lease holder that allows that party to take over the use of an existing permit on that lease under certain conditions. Failure to obtain the permits from the third party could result in a longer process to obtain permission to construct a processing facility, refuse area or rail load out at Emmaus.

(d) Access to infrastructure

Mineral Industry Risks

It is envisioned that it may be possible for mining to commence, utilizing third party processing, refuse disposal and rail loading through either a tolling or plant gate sale arrangement. While there are a number of third party plants within the region that may be feasible options, reaching a commercial agreement may prove to be problematic due to unforeseen circumstances.

Further, each plant’s configuration and the distance to haul may hinder the consideration of certain plants as being viable options to process coal of the Emmaus and Blackstone qualities.

(e) Dependence on key personnel

The Company is reliant on a number of key personnel employed by the Company. Loss of such personnel may have a materially adverse impact on the performance of the Company. While there can be no assurance given as to the continued availability of such key personnel, the Company expects that the existing team will continue.

(a) Resource and Reserve Estimates

Coal Reserve and Coal Resource estimates are expressions of judgment based on drilling results and other exploration observations along with and Competent Person’s experience working with coal mining properties, and other factors. Estimates based on available data and interpretations and thus estimations may prove to be inaccurate or may change substantially when new information becomes available.

The actual quality and characteristics of coal deposits cannot be known until mining takes place, and will almost always differ from the assumptions used to develop resources.

Coal Reserves are value based financial and operational forecasts and consequently, the actual Coal Reserves and Coal Resources may differ from those estimated either positively or negatively.

(b) Exploration and Development Risks

The tenements are in the early stages of exploration and potential investors should understand that mineral exploration, development and mining are high‐risk enterprises, only occasionally providing high rewards. In addition to the normal competition for prospective ground, and the high average costs of discovery of an economic deposit, factors such as demand for commodities, stock market fluctuations affecting access to new capital, sovereign risk, environmental issues, labour disruption, project financing difficulties, foreign currency fluctuations and technical problems all affect the ability of a company to profit from any discovery.

There is no assurance that exploration of the mineral interests to be acquired pursuant to the Acquisition, or any other projects that may be acquired by the Company in the future, will result in the discovery of an economically viable mineral deposit. Even if an apparently viable mineral deposit is identified, there is no guarantee that it can be profitably exploited.

Premier’s mining and exploration activities are dependent upon the grant and subsequent the maintenance of relevant licences, leases, permits and regulatory consents which may be withdrawn or made subject to limitations. The maintaining of the consents, obtaining renewals, or getting licences granted, typically depends on the Company’s success in obtaining

required approvals for its proposed activities and that its licences, leases, permits or consents will be kept in good order and renewed as and when required.

There is no assurance that such grants and renewals will be given as a matter of course and there is no assurance that new conditions will not be imposed.

(d) Operational Risks

The operations of the Company following completion of the Acquisition may be affected by various factors including failure to locate or identify mineral deposits, failure to achieve predicted grades in exploration or mining, operational and technical difficulties encountered in mining, difficulties in commissioning and operating plant and equipment, mechanical failure or plant breakdown, unanticipated metallurgical problems which may affect extraction costs, adverse weather conditions, industrial and environmental accidents, industrial disputes and unexpected shortages or increases in the costs of consumables, spare parts, plant and equipment, fire, explosions and other incidents beyond the control of the Company.

These risks and hazards could also result in damage to, or destruction of, production facilities, personal injury, environmental damage, business interruption, monetary losses and possible legal liability. While the Company currently intends to maintain insurance within ranges of coverage consistent with industry practice, no assurance can be given that the Company will be able to obtain such insurance coverage at reasonable rates (or at all), or that any coverage it obtains will be adequate and available to cover any such claims.

(e) Payment Obligations

Under the mineral licences and leases comprising the Projects, the Company will become subject to payment and other obligations. In particular, holders are required to expend the funds necessary to meet the minimum work commitments attaching to the licences and leases. Failure to meet these work commitments will render the licence or lease liable to be cancelled. Further, if any contractual obligations are not complied with when due, in addition to any other remedies that may be available to other parties, this could result in dilution or forfeiture of the Company’s interest in the Projects.

(f) Commodity Price Volatility and Foreign Exchange Risk

In the event that the Company achieves exploration success leading to production, the revenue it will derive through the sale of commodities exposes the potential income of the Company to commodity price risks.

Commodity prices fluctuate and are affected by numerous factors beyond the control of the Company. These factors include world demand for coal, forward selling by producers, and production cost levels in major metal‐producing regions.

Moreover, commodity prices are also affected by macroeconomic factors such as expectations regarding inflation, interest rates and global and regional demand for, and supply of, the commodity as well as general global economic conditions. These factors may have an adverse effect on the Company’s exploration, development and production activities, as well as on its ability to fund those activities.

Furthermore, international prices of various commodities are denominated in United States Dollars and a portion of the Company’s capital expenditure and ongoing expenditure is denominated in either United States Dollars, whereas the income and expenditure of the Company are and will be taken into account in Australian currency, exposing the Company to

the fluctuations and volatility of the rate of exchange between the United States Dollar and the Australian Dollar as determined in international markets.

(g) Environmental Risks

The coal mining industry has become subject to increasing environmental responsibility and liability. The potential for liability is an ever present risk. Future legislation and regulations governing coal production may impose significant environmental obligations on the Company in relation to coal mining. The Company intends to conduct its activities in a responsible manner which minimises its impact on the environment, and in accordance with applicable laws.

The operations and proposed activities of the Company are subject to regulations concerning the environment. The government and other authorities that administer and enforce environmental laws determine these requirements. As with all exploration projects and mining operations, the Company’s activities are expected to have an impact on the environment, particularly if mine development proceeds. The Company intends to conduct its activities in an environmentally responsible manner and in accordance with applicable laws.

The cost and complexity of complying with the applicable environmental laws and regulations may prevent the Company from being able to develop potentially economically viable mineral deposits.

Although the Company believes that it is in compliance in all material respects with all applicable environmental laws and regulations, there are certain risks inherent to its activities, such as accidental spills, leakages or other unforeseen circumstances, which could subject the Company to extensive liability.

Further, the Company may require approval from the relevant authorities before it can undertake activities that are likely to impact the environment. Failure to obtain such approvals will prevent the Company from undertaking its desired activities. The Company is unable to predict the effect of additional environmental laws and regulations, which may be adopted in the future, including whether any such laws or regulations would materially increase the Company's cost of doing business or affect its operations in any area.

There can be no assurances that new environmental laws, regulations or stricter enforcement policies, once implemented, will not oblige the Company to incur significant expenses and undertake significant investments in such respect which could have a material adverse effect on the Company's business, financial condition and results of operations.

4. General Risks

(a) Economic Risk

Changes in the general economic climate in which the Company will operate following completion of the Acquisition may adversely affect the financial performance of the Company. Factors that may contribute to that general economic climate include the level of direct and indirect competition against the Company, industrial disruption and the rate of growth of gross domestic product in Australia and the United States and other jurisdictions in which the Company may acquire mineral assets

(b) Future Capital Needs and Additional Funding

The future capital requirements of the Company will depend on many factors including the results of future exploration and business development activities. The Company believes its

available cash and resources following the Acquisition should be adequate to fund its exploration work program, business development activities and other Company objectives.

Should the Company require additional funding there can be no assurance that additional financing will be available on acceptable terms, or at all. Any inability to obtain additional finance, if required, would have a material adverse effect on the Company’s business and its financial condition and performance.

Any material adverse changes in government policies or legislation of Australia, the United States or any other country that the Company may acquire economic interests may affect the viability and profitability of the Company.

Schedule 5 – Leases and Commitments

Emmaus Project

Lease # 1

Date of lease: July 24, 2012

Royalty: $2.00 per net ton or 7% of the average gross selling price per net ton whichever is greater. Annual minimum: $7400.00 fully recoupable

Wheelage: $0.25 per net ton, coal transported over property

TERM: 5 years or until all mineable and merchantable coal has been removed from underlying property. Lease shall be automatically extended yearly after initial term. Once coal is gone, rights shall remain for coal haulage purposes at a $500.00 annual rental fee plus wheelage.

Lease # 2

Date Of Lease: August 23[rd] , 2012 Royalty: $2.00 per net ton or 7% of the average gross selling price per net ton whichever is greater. Wheelage: $0.25 per net ton, coal transported over property Annual minimum: $2600.00 fully recoupable

Lease # 3

Date Of Lease: September 26[th] , 2012 Royalty: $2.00 per net ton or 7% of the average gross selling price per net ton whichever is greater. Wheelage: $0.25 per net ton, coal transported over property Annual minimum: $10,000 fully recoupable

Lease # 4

Date Of Lease: November 21[st] , 2012

Royalty: $2.00 per net ton or 7% of the average gross selling price per net ton whichever is greater. Wheelage: $0.25 per net ton, coal transported over property

Annual minimum: $10,000 fully recoupable.

Premier Coal Option

Annual Minimum Royalty: $300,000; Fully Recoupable(commencing 12 months after acquisition) Production Royalty: $2 per clean ton plus 8% of sales price over $110

Wheelage: $0.50 per clean ton through any wash plant on property

Permit Payments: If and when the first set of Mining Permits is Issued to Premier or its designee, they shall pay Emmaus the non‐recoupable sum of $125,000 in cash. If and when the second set of Mining Permits is Issued to Premier or its designee, they shall pay Emmaus the non‐recoupable sum of $125,000 in cash. ) If and when the Plant Permits are Issued to Premier or its designee, Premier shall pay Emmaus an additional non‐recoupable sum of $250,000 in cash.

Blackstone Project

Lease # 1

DATE OF LEASE: September 26th, 2012 Royalty: 8% of the average gross selling price per net ton Wheelage: $1.00 per net ton, coal transported over property Annual minimum: $5,000 fully recoupable. Blackstone Option Annual Minimum Royalty: Nil; Fully Recoupable Production Royalty: $2 per clean ton plus 8% of sales price over $110 Wheelage: None Deep Mine Permit (Permit No U400108 & WV1021541)

Annual Minimum Royalty:US$130,000 paid six monthly and calculation commencing in July 2014; First Payment December 17 2014; Fully Recoupable Production Royalty: $2 per clean ton Wheelage: None

FITZROY RESOURCES LIMITED ACN 145 590 110

P R O X Y F O R M

The Company Secretary By post: Fitzroy Resources Limited GPO Box 839, West Perth, WA 6872

By facsimile: (08) 9320 7501

Step 1 – Appoint a Proxy to Vote on Your Behalf

I/We[1] _______of ____________

being a Shareholder/Shareholders of the Company and entitled to ______ votes in the Company, hereby appoint:

The Chairman of the OR if you are NOT appointing the Chairman of the Meeting (mark box) Meeting as your proxy, please write the name and address of the person or body corporate (excluding the registered shareholder) you are appointing as your proxy

or failing the individual or body corporate named, or if no individual or body corporate is named, the Chairman of the Meeting, as my/our proxy to act generally at the Meeting to be held at 9.30am (WST) on 16 December 2013 at Level 1, 35‐37 Havelock Street, West Perth, Western Australia on my/our behalf and to vote in accordance with the following directions (or if no directions have been given, and to the extent permitted by law, as the proxy sees fit, except as provided below).

Important for Resolutions 7 and 8 – If the Chairman is your proxy or is appointed your proxy by default

I/we direct the Chair to vote in accordance with his/her voting intentions (as set out below) on Resolutions 7 and 8 (except where I/we have indicated a different voting intention in Step 2 below) and expressly authorise that the Chair may exercise my/our proxy even though Resolutions 7 and 8 are connected directly or indirectly with the remuneration of a member of the Key Management Personnel and acknowledge that the Chair may exercise my/our proxy even if the Chair has an interest in the outcome Resolutions 7 and 8 and that votes cast by the Chair for those resolutions other than as proxy holder will be disregarded because of that interest.

If you do not mark this box, and you have not directed your proxy how to vote, the Chairman will not cast your votes on Resolution 7 and 8 and your votes will not be counted in calculating the required majority if a poll is called on Resolution 7 and 8.

The Chairman of the Meeting intends to vote undirected proxies in favour of each resolution.

Proxy appointments will only be valid and accepted by the Company if they are made and received no later than 48 hours before the meeting.

Please read the voting instructions overleaf before marking any boxes with an  .

Step 2 – Instructions as to Voting on Resolutions

INSTRUCTIONS AS TO VOTING ON RESOLUTIONS

The proxy is to vote for or against the Resolution referred to in the Notice as follows:

		For
Resolution	1	Approval of Acquisition of Premier Coal
Resolution	2	Approval of Change in Scale of Activities
Resolution	3	Approval of Performance Shares
Resolution	4	Authority to issue Placement Shares
Resolution	5	Authority to issue Adviser Shares – Argonaut
Resolution	6	Authority to issue Adviser Shares – Forrest Capital
Resolution	7	Adoption of Fitzroy Resources Employee Share Acquisition Plan
Resolution	8	Authority to Allocate Plan Shares to Mr Russell Lynton‐Brown

If you mark the Abstain box for a particular Resolution, you are directing your proxy not to vote on your behalf on a show of hands or on a poll and your votes will not be counted in computing the required majority on a poll.

Authorised signature/s

This section must be signed in accordance with the instructions below to enable your voting instructions to be implemented.

The Chairman of the Meeting intends to vote undirected proxies in favour of each Resolution.

Individual or Shareholder 1 Sole Director and Sole Company Secretary _______ Contact Name	Shareholder 2 Director _____ Contact Daytime Telephone	Shareholder 3

		Director/Company Secretary _______ Date

1Insert name and address of Shareholder

Proxy Notes:

A Shareholder entitled to attend and vote at the Meeting may appoint a natural person as the Shareholder's proxy to attend and vote for the Shareholder at that Meeting. If the Shareholder is entitled to cast 2 or more votes at the Meeting the Shareholder may appoint not more than 2 proxies. Where the Shareholder appoints more than one proxy the Shareholder may specify the proportion or number of votes each proxy is appointed to exercise. If such proportion or number of votes is not specified each proxy may exercise half of the Shareholder's votes. A proxy may, but need not be, a Shareholder of the Company.

If a Shareholder appoints a body corporate as the Shareholder’s proxy to attend and vote for the Shareholder at that Meeting, the representative of the body corporate to attend the Meeting must produce the Certificate of Appointment of Representative prior to admission. A form of the certificate may be obtained from the Company’s share registry.

You must sign this form as follows in the spaces provided:

Joint Holding: where the holding is in more than one name all of the holders must sign. Power of Attorney: if signed under a Power of Attorney, you must have already lodged it with the registry, or alternatively, attach a certified photocopy of the Power of Attorney to this Proxy Form when you return it.

Companies: a Director can sign jointly with another Director or a Company Secretary. A sole Director who is also a sole Company Secretary can also sign. Please indicate the office held by signing in the appropriate space.

If a representative of the corporation is to attend the Meeting the appropriate "Certificate of Appointment of Representative" should be produced prior to admission. A form of the certificate may be obtained from the Company’s Share Registry.

Proxy Forms (and the power of attorney or other authority, if any, under which the Proxy Form is signed) or a copy or facsimile which appears on its face to be an authentic copy of the Proxy Form (and the power of attorney or other authority) must be deposited at or received by facsimile transmission at the address below no later than 48 hours prior to the time of commencement of the Meeting (WST).

Postal address: PO Box 839 West Perth WA 6872

Facsimile: (08) 9320 7501 if faxed from within Australia or +618 9320 7501 if faxed from outside Australia.

AI assistant

4DS MEMORY LIMITED — Proxy Solicitation & Information Statement 2013

64258_rns_2013-11-14_276e08cc-4c8b-460e-b61f-a700c4641320.pdf

FITZROY RESOURCES LIMITED ACN 145 590 110

NOTICE OF GENERAL MEETING

FITZROY RESOURCES LIMITED

ACN 145 590 110

NOTICE OF GENERAL MEETING

AGENDA

1. Resolution 1 – Approval of Acquisition of Premier Coal

Voting Exclusion

2. Resolution 2 – Approval of Change in Scale of Activities

Voting Exclusion

3. Resolution 3 – Approval of Performance Shares

4. Resolution 4 – Authority to issue Placement Shares

Voting Exclusion

5. Resolution 5 – Authority to Issue Adviser Shares – Argonaut

Voting Exclusion

6. Resolution 6 – Authority to Issue Adviser Shares – Forrest Capital

Voting Exclusion

7. Resolution 7 – Adoption of Fitzroy Resources Employee Share Acquisition Plan

Voting Exclusion

Voting Prohibition Statement

8. Resolution 8– Authority to Allocate Plan Shares to a Director – Mr Russell Lynton‐Brown

Voting Exclusion

Voting Prohibition Statement

FITZROY RESOURCES LIMITED

ACN 145 590 110

EXPLANATORY MEMORANDUM

1. Introduction

2. Action to be taken by Shareholders

2.1 Proxies

3. Overview of Acquisition and Change of Scale of Activities

3.1 Background

3.2 Background to Acquisition of Premier Coal – Change of Scale of Activities

(together, the Conditions ).

(together the Milestones ).

3.3 Background on Premier Coal and its assets

Hard Coking Coal

Project Locations

Project History

Geology

Targeted Seams

Drilling Program

Infrastructure

3.4 Pro‐forma Balance Sheet

3.5 Effect of the Acquisition on the Company

3.6 Advantages of the Acquisition

3.7 Disadvantages of the Acquisition

3.8

Risk Factors

3.9 Plans for the Company if the Acquisition is not completed

3.10 Directors’ Recommendation in relation to Acquisition

3.11 Forward looking statements

4. Resolution 1 – Approval of Acquisition of Premier Coal

4.1 General

4.2 Listing Rule 7.1

5. Resolution 2 – Approval of Change in Scale of Activities

5.1 General

5.2 Listing Rule 11.1.2

6. Resolution 3 – Approval of Performance Shares

7. Resolution 4 – Authority to Issue Placement Shares

7.1 Specific information required by Listing Rule 7.3

8. Resolution 5 – Authority to Issue Adviser Shares – Argonaut

8.1 General

8.2 Specific information required by Listing Rule 7.3

9. Resolution 6 – Authority to Issue Adviser Shares – Forrest Capital

9.1 General

9.2 Specific information required by Listing Rule 10.13

10. Resolution 7 – Adoption of Fitzroy Resources Employee Share Acquisition Plan

10.1 Introduction

10.2 Corporations Act

10.3 Specific Information Required by Listing Rule 7.2 Exception 9(b)

11. Resolution 8 – Authority to Allocate Plan Shares to a Director – Mr Russell Lynton‐Brown

11.1 Background

11.2 Listing Rule 10.14

11.3 Specific information required under Listing Rule 10.15

12. Definitions

Schedule 1 –Terms and Conditions of Performance Shares

Performance Shares

4DS MEMORY LIMITED Proxy Solicitation & Information Statement 2013