ADAVALE RESOURCES LIMITED — Capital/Financing Update 2021

Jan 19, 2021

Proposed issue of securities

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Announcement Summary

Entity name

ADAVALE RESOURCES LIMITED

Announcement Type

New announcement

Date of this announcement

Wednesday January 20, 2021

The Proposed issue is:

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A placement or other type of issue

Total number of +securities proposed to be issued for a placement or other type of issue

Maximum Number of ASX +security code +Security description +securities to be issued n/a Incentive Rights 1,620,000

Proposed +issue date

Wednesday January 20, 2021

Refer to next page for full details of the announcement

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Part 1 - Entity and announcement details

1.1 Name of +Entity

ADAVALE RESOURCES LIMITED

We (the entity named above) give ASX the following information about a proposed issue of +securities and, if ASX agrees to +quote any of the +securities (including any rights) on a +deferred settlement basis, we agree to the matters set out in Appendix 3B of the ASX Listing Rules.

1.2 Registered Number Type

ABN

Registration Number

91008719015

1.3 ASX issuer code

ADD

1.4 The announcement is

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New announcement

1.5 Date of this announcement

Wednesday January 20, 2021

1.6 The Proposed issue is:

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A placement or other type of issue

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Part 7 - Details of proposed placement or other issue

Part 7A - Conditions

7A.1 - Are any of the following approvals required for the placement or other type of issue? +Security holder approval Court approval Lodgement of court order with +ASIC ACCC approval FIRB approval Another approval/condition external to the entity Yes

7A.1a Conditions

Approval/Condition Date for determination Is the date estimated or ** Approval actual? received/condition met? +Security holder approval Monday December 21, 2020 Actual Yes

Comments

Part 7B - Issue details

Is the proposed security a 'New Will the proposed issue of this class' (+securities in a class that is +security include an offer of not yet quoted or recorded by ASX) attaching +securities? or an 'Existing class' (additional No securities in a class that is already quoted or recorded by ASX)? New class

Details of +securities proposed to be issued

ISIN Code (if Issuer is a foreign company and +securities are non CDIs)

Have you received confirmation from Will the entity be seeking quotation ASX that the terms of the proposed of the 'new' class of +securities on +securities are appropriate and ASX? equitable under listing rule 6.1? No No ASX +security code +Security description New class-code to be confirmed Incentive Rights

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+Security type

Performance options/rights

Number of +securities proposed to be issued

1,620,000

Offer price details

Are the +securities proposed to be issued being issued for a cash consideration? No

Please describe the consideration being provided for the +securities

These incentives were approved at the 2020 AGM, as a remuneration bonus for the Company achieving a significant milestone in the Company's share price. These securities contain a hurdle that requires the share price to achieve at least a 5-day VWAP of $0.10 within 12 months of the 2020 AGM, then the Incentive Rights will be converted to Shares on a 1:1 basis.

Please provide an estimate of the AUD equivalent of the consideration being provided for the +securities

0.0000001

Will all the +securities issued in this class rank equally in all respects from their issue date?

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Yes

Performance options/rights details

+Security currency AUD - Australian Dollar

Exercise price Expiry date AUD 0.1000 Monday December 20, 2021

Details of the type of +security that will be issued if the option is exercised

ADD : ORDINARY FULLY PAID

Number of securities that will be issued if the option is exercised

1,620,000

Please provide a URL link for a document lodged with ASX setting out the material terms of the +securities proposed to be issued or provide the information by separate announcement.

• Explanatory Memorandum in Notice of 2020 Annual General Meeting for resolutions 15 to 17, https://cdn api.markitdigital. com/apiman-gateway/ASX/asx-research/1.0/file/2924-02309379-2A1264032?access_token=83ff96335c2d45a094df02a2 06a39ff4

Part 7C - Timetable

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7C.1 Proposed +issue date Wednesday January 20, 2021 Part 7D - Listing Rule requirements

7D.1 Has the entity obtained, or is it obtaining, +security holder approval for the entire issue under listing rule 7.1? Yes

7D.1a Date of meeting or proposed meeting to approve the issue under listing rule 7.1 Monday December 21, 2020

7D.2 Is a party referred to in listing rule 10.11 participating in the proposed issue? Yes

7D.3 Will any of the +securities to be issued be +restricted securities for the purposes of the listing rules? No

7D.4 Will any of the +securities to be issued be subject to +voluntary escrow? No

Part 7E - Fees and expenses

7E.1 Will there be a lead manager or broker to the proposed issue? No

7E.2 Is the proposed issue to be underwritten? No

7E.4 Details of any other material fees or costs to be incurred by the entity in connection with the proposed issue Nil costs, except ASX quotation fees if the share price hurdle is achieved before on or before 21 December 2021 and resulting shares are then issued.

Part 7F - Further Information

7F.01 The purpose(s) for which the entity is issuing the securities Incentivise Directors.

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7F.1 Will the entity be changing its dividend/distribution policy if the proposed issue proceeds? No

7F.2 Any other information the entity wishes to provide about the proposed issue

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