NAVIGATOR)RESOURCES)LIMITED))) (Subject)to)Deed)of)Company)Arrangement)))

ACN)063)366)487)

NOTICE)OF)EXTRAORDINARY)GENERAL) MEETING)

EXPLANATORY)STATEMENT)

PROXY)FORM)

TIME:! 10:30AM!(AWST)!! DATE:! 21!January!2016! PLACE:! Otsana!Capital,!108!Outram!Street,!West!Perth,!WA!

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

Stantons! International! Securities! Pty! Ltd! (ACN! 128! 908! 289)! trading! as! Stantons! International!Securities!( Stantons )!has!prepared!the!Independent!Expert’s!Report!and!has! provided!an!opinion!that!it!believes!the!proposals!as!outlined!in!Resolution!8!of!this!Notice! of!Meeting!are!fair!and!reasonable!to!the!nonUassociated!Shareholders!of!the!Company.!! A!copy!of!the!Independent!Expert’s!Report!is!contained!in!Annexure!A!of!this!Notice!of! Meeting.!It!is!recommended!that!all!Shareholders!read!the!Independent!Expert’s!Report!in! full.!

The! Deed! Administrator! has! not! prepared! the! Notice! of! Meeting,! the! Explanatory! Statement,! the! Independent! Experts! Report! or! the! Proxy! Form.! Accordingly,! the! Deed! Administrator,! his! servants,! agents! and! employees! do! not! make! any! representation! or! warranty!(express!or!implied)!as!to!the!accuracy,!reasonableness!or!completeness!of!the! information! contain! in! those! documents! and! accepts! no! responsibility! or! liability! for! the! content!of!these!documents,!or!failure!to!include!any!information!or!disclosures!in!these! documents!which!have!been!prepared!by!the!New!Board!or!Stantons.!

Should!you!wish!to!discuss!the!matters!in!this!Notice!of!Meeting!please!do!not!hesitate!to! contact!Philip!Girling!of!the!Deed!Administrator’s!office!on!(08)!9322!2022!!

CONTENTS)PAGE)

LettertoShareholders	4
NoticeofExtraordinaryGeneralMeeting(settingouttheproposedResolutions)	6
ExplanatoryStatement(explainingtheproposedResolutions)	18
Glossary	66
AnnexureA–IndependentExpert’sReport 69
AnnexureB–Table:DilutionaryeffectofissueofRelatedPartySecurities89
AnnexureC–TermsofFirstPlacementOptions90
AnnexureD–TermsoftheManagementOptions 92
AnnexureE–NominationofAuditor 94
ProxyForm	96
TIMEANDPLACEOFMEETINGANDHOWTOVOTE

VENUE)

The!Extraordinary!General!Meeting!of!the!Shareholders!to!which!this!Notice!of!Meeting!relates! will!be!at!10:30AM!(AWST)!on!21!January!2016!at:!Otsana!Capital,!108!Outram!Street,!West! Perth,!WA.!

YOUR)VOTE)IS)IMPORTANT)

The!business!of!the!Extraordinary!General!Meeting!affects!your!shareholding!and!your!vote! is!important.!

VOTING)IN)PERSON)

To!vote!in!person,!attend!the!Extraordinary!General!Meeting!on!the!date!and!at!the!place!set! out!above.!

VOTING)BY)PROXY))

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

(a)! deliver!the!proxy!form:!
(i)! by!hand!to!Pitcher!Partners,!Attention:!Philip!Girling,!Level!1,!914!Hay!Street,! Perth!WA,!6000]!or!
(ii)!by!post!to!Pitcher!Partners,!Attention:!Philip!Girling,!P.O!Box!7191,!Cloisters! Square,!WA,!6850!

(b)! by!facsimile!to!Pitcher!Partners,!Attention:!Philip!Girling!on!(08)!9322!1262!!

so!that!it!is!received!not!later!than!10:30AM!(AWST)!on!19!January!2016.!

Proxy)Forms)received)later)than)this)time)will)be)invalid.

LETTER)TO)SHAREHOLDERS))

Dear!Shareholder,!

As! you! are! aware,! on! 28! March! 2013! Navigator! Resources! Limited! (ACN! 063! 366! 487)! (subject!to!Deed!of!Company!Arrangement)!( Company) or! NAV )!was!placed!into!voluntary! administration,! with! Mr! Bryan! Hughes! of! Pitchers! Partners! appointed! as! Administrator! ( Administrator) and! Deed) Administrator )! of! the! Company! and! assumed! control! of! the! Company!and!its!business,!property!and!affairs.!

A!deed!of!company!arrangement!was!entered!into!on!31!May!2013.!!

On!11!August!2015,!creditors!of!the!Company!( Creditors )!voted!in!favour!of!a!revision!of!the! deed! of! company! arrangement! ( DOCA )! submitted! by! a! syndicate! of! investors! formed! by! Otsana!Capital!( Otsana )!and!Auxano!LLP!( Auxano )!(together!forms!part!of!the!“ Syndicate ”),! which!dealt!with!the!Company’s!Cummins!Range!rare!earths!exploration!project!and!also! contemplated!the!subsequent!restructure!and!recapitalisation!of!the!Company!including!the! settlement!of!the!claims!of!the!Creditors!( Proposal ).!!

On! 9! September! 2015,! the! Deed! Administrator! entered! into! a! variation! of! the! previous! arrangements! and! the! DOCA! with! the! Syndicate! to! effect! the! terms! of! the! Proposal!was! executed!( DOCA ).!

The! Proposal! requires,! and! is! subject! to,! various! approvals! being! obtained! from! the! Shareholders! of! the! Company.! Accordingly,! the! Deed! Administrator! have! called! an! Extraordinary! General! Meeting! of! the! Company! to! obtain! the! necessary! Shareholder! approvals.!The!Extraordinary!General!Meeting!will!be!held!at!10:30AM!(AWST)!on!21!January! 2016!at!Otsana!Capital,!108!Outram!Street,!West!Perth,!WA!( Meeting ).!Enclosed!with!this! letter!are!the!Notice!of!the!Extraordinary!General!Meeting!( Notice ),!the!Explanatory!Statement! and!the!Independent!Expert’s!Report!prepared!by!Stantons!Securities!International!Pty!Ltd! (ACN!128!908!289)!trading!as!Stantons!International!Securities!( Stantons ).!!

A!summary!of!the!Proposal,!conditions!of!the!Proposal,!the!proUforma!capital!structure,!the! proposed!use!of!funds!and!the!conditions!to!reinstatement!to!Official!Quotation!on!the!ASX! can!be!found!at!the!beginning!of!the!Explanatory!Statement!on!page!18!of!this!Notice.!

Shareholders!are!urged!to!give!careful!consideration!to!this!Notice,!the!Explanatory!Statement! and!the!Independent!Expert’s!Report!prepared!by!Stantons,!as!the!Resolutions!contained!in! this!Notice!are!important!and!affect!the!future!of!the!Company.!!

In! considering! the! Resolutions,! Shareholders! must! bear! in! mind! the! Company’s! current! financial!circumstances.!In!this!regard,!Shareholders!should!note!that!the!Securities!of!the! Company! have! been! suspended! from! trading! since! 20! February! 2013! and! the! Company! requires!recapitalisation!to!continue!its!operations!and!seek!reUquotation!of!its!Securities!on! ASX.!The!Resolutions!contained!in!this!Notice!are!therefore!important!and!affect!the!future!of! the!Company.!Shareholders!are!urged!to!give!careful!consideration!to!this!Notice!and!the! contents!of!this!Explanatory!Statement.!

The!Deed!Administrator!considered!in!the!Administrator’s!Report!pursuant!to!section!445F!of! the!Corporations!Act!2001!dated 31!July!2015!that!the!Proposal!would!result!in!a!greater!return! to!Creditors!than!the!Company!being!placed!in!liquidation.!The!proposed!New!Board!also! believe!this!to!be!a!realistic!option!to!enable!the!Company!to!continue!operating.!The!Deed! Administrator!will!need!to!investigate!other!options!for!the!Company!if!this!restructure!and! recapitalisation! is! not! approved! by! Shareholders,! which! will! include! liquidation! (unless!

otherwise!agreed!between!the!Syndicate!and!the!Deed!Administrator),!in!which!case!it!is! expected!there!will!be!no!return!to!Shareholders.!

The) Deed) Administrator) has) not) prepared) the) Notice) of) Meeting,) the) Explanatory) Statement,)the)Independent)Experts)Report)or)the)Proxy)Form.)Accordingly,)the)Deed) Administrator,)his)servants,)agents)and)employees)do)not)make)any)representation)or) warranty)(express)or)implied))as)to)the)accuracy,)reasonableness)or)completeness)of) the)information)contain)in)those)documents)and)accepts)no)responsibility)or)liability) for)the)content)of)these)documents,)or)failure)to)include)any)information)or)disclosures) in)these)documents)which)have)been)prepared)by)the)New)Board)or)Stantons.

Yours!faithfully!

Bryan)Hughes) Deed)Administrator) Navigator)Resources)Limited) (Subject)to)Deed)of)Company)Arrangement))

NOTICE)OF)EXTRAORDINARY)GENERAL)MEETING

Notice!is!hereby!given!that!the!Extraordinary!General!Meeting!of!Shareholders!of!Navigator! Resources!Limited!(ACN!063!366!487)!(subject!to!Deed!of!Company!Arrangement)!will!be! held!at!10:30AM!on!21!January!2016!at!Otsana!Capital,!108!Outram!Street,!West!Perth,!WA! ( Meeting ).!

For!the!purpose!of!regulation!7.11.37!of!the!Corporations!Regulations!2001,!the!Company! has!determined!that!the!Shareholding!of!each!Shareholder!for!the!purposes!of!ascertaining! their!voting!entitlements!for!the!Meeting!will!be!as!it!appears!on!the!Company’s!Share!Register! at!7pm!(AWST)!on!19!January!2016!( Entitlement)Time ).!Accordingly,!only!those!persons! registered!as!holders!of!Shares!at!the!Entitlement!Time!will!be!entitled!to!attend!and!vote!at! the! Meeting.! Transactions! registered! after! that! time! will! be! disregarded! in! determining! Shareholders!entitled!to!attend!and!vote!at!the!Meeting.

The!Explanatory!Statement!that!accompanies!and!forms!part!of!this!Notice!of!Extraordinary! General! Meeting! ( Notice )! describes! in! more! detail! the! matters! to! be! considered! at! the! Meeting.! In! addition,! the! Explanatory! Statement! should! be! read! in! conjunction! with! the! Independent!Expert’s!Report!prepared!by!Stantons!International!Pty!Ltd!(ACN!128!908!289)! trading!as!Stantons!International!Securities!( Stantons )!contained!in!Annexure!A.!!

Terms! and! abbreviations! used! in! this! Notice! of! Meeting! and! Explanatory! Statement! are! defined!in!the!Glossary.!

RESOLUTIONS

1.) RESOLUTION)1)–)ISSUE)OF)SECURITIES)PURSUANT)TO)THE)FIRST)PLACEMENT)

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

a.' up'to'200,000,000'fully'paid'ordinary'shares'to''Auxano'(or'its'nominees)'and' other'investors'that'are'invited'by'the'Company'as'part'of'the'Proposal'( First& Placement&A&Shares )'at'an'issue'price'of'$0.0025'per'First'Placement'A'Share' to'raise'up'to'$500,000P'
b.' up'to'25,000,000'fully'paid'ordinary'shares'to'Otsana''(or'its'nominees)'and'other' investors' that' are' invited' by' the' Company' as' part' of' the' Proposal' ( First& Placement&B&Shares )'at'an'issue'price'of'$0.00001'per'First'Placement'B'Share' to'raise'up'to'$250P'
c.' up'to'150,000,000'Options'to'each'subscribe'for'one'(1)'Share'in'the'Company' to'Auxano''(or'its'nominees)'and'other'investors'that'are'invited'by'the'Company' as'part'of'the'Proposal'( First&Placement&Options )'for'nil'consideration,'with' each'First'Placement'Option'exercisable'at'$0.01'expiring'3'years'from'the'date' of'issueP'and'
d.' up'to'25,000,000'Options'to'each'subscribe'for'one'(1)'Share'in'the'Company' to'Otsana''(or'its'nominees)'and'other'investors'that'are'invited'by'the'Company' as'part'of'the'Proposal'( First&Placement&Options )'for'nil'consideration,'with' each'First'Placement'Option'exercisable'at'$0.01'expiring'3'years'from'the'date' of'issue,'

on'terms'and'conditions'all'of'which'are'described'in'the'Explanatory'Statement'which' accompanies'and'forms'part'of'the'Notice'of'Meeting.”

Voting)exclusion)statement:) The!Company!will!disregard!any!votes!cast!on!Resolution! 1!by:!

(a)! a!person!who!is!proposing!to!participate!in!the!issue]!
(b)! 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!
(c)! an!associate!of!any!person!described!in!(a)!or!(b).!

However,!the!Company!need!not!disregard!a!vote!if:!

(i)! it! is! cast! by! a! person! acting! as! a! proxy! for! another! person! entitled! to! vote,! in! accordance!with!the!direction!on!the!proxy!form]!or!
(ii)! it!is!cast!by!the!person!chairing!the!meeting!( the)Chair )!as!proxy!for!a!person!who! is!entitled!to!vote,!in!accordance!with!a!direction!on!the!proxy!form!to!vote!as!the! proxy!decides.!

2.) RESOLUTION)2)–)ISSUE)OF)SECOND)PLACEMENT)SHARES)

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

a.' up' to' 150,000,000' fully' paid' ordinary' shares' to' general' investors' (that' may' include' members' of' the' Syndicate' (or' its' nominees))' ( Second& Placement& Shares )'at'an'issue'price'of'$0.01'per'Second'Placement'Share''to'raise'up'to' $1,500,000,'

on'terms'and'conditions'all'of'which'are'described'in'the'Explanatory'Statement'which' accompanies'and'forms'part'of'the'Notice'of'Meeting.”

Voting)exclusion)statement:) The!Company!will!disregard!any!votes!cast!on!Resolution! 2!by:!

(a)! a!person!who!is!proposing!to!participate!in!the!issue]! (b)! 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!
(c)! an!associate!of!any!person!described!in!(a)!or!(b).!

However,!the!Company!need!not!disregard!a!vote!if:!

(i)! it! is! cast! by! a! person! acting! as! a! proxy! for! another! person! entitled! to! vote,! in! accordance!with!the!direction!on!the!proxy!form]!or!
(ii)! it!is!cast!by!the!person!chairing!the!meeting!( the)Chair )!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)FUTURE)ISSUE)OF)50,000,000)MANAGEMENT) OPTIONS)

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

“That,'subject'to'all'other'Resolutions'(other'than'Resolutions'13716'(inclusive))'being' passed,' for' the' purpose' of' ASX' Listing' Rule' 7.1' and' for' all' other' purposes,' the' Shareholders'of'the'Company'approve'the'issue'of'50,000,000'options'to'proposed' Directors,' key' management' and' advisers' of' the' Company' (or' their' nominees)' ( Management& Options )' for' nil' consideration' at' an' exercise' price' of' $0.02' per' Management' Option' with' terms' described' in' the' Explanatory' Statement' which' accompanies'and'forms'part'of'the'Notice'of'Meeting.”''

Voting)exclusion)statement:) The!Company!will!disregard!any!votes!cast!on!Resolution! 3!by:!

(a)! a!person!who!is!proposing!to!participate!in!the!issue]! (b)! 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!
(c)! an!associate!of!any!person!described!in!(a)!or!(b).!

However,!the!Company!need!not!disregard!a!vote!if:!

(i)! it! is! cast! by! a! person! acting! as! a! proxy! for! another! person! entitled! to! vote,! in! accordance!with!the!direction!on!the!proxy!form]!or!
(ii)! it!is!cast!by!the!person!chairing!the!meeting!( the)Chair )!as!proxy!for!a!person!who! is!entitled!to!vote,!in!accordance!with!a!direction!on!the!proxy!form!to!vote!as!the! proxy!decides.!

4.) RESOLUTION)4)–)ACQUISITION)OF)A)RELEVANT)INTEREST)

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

“That,'subject'to'all'other'Resolutions'(other'than'Resolutions'13716'(inclusive))'being' passed,'for'the'purpose'of'section'611'(item'7)'of'the'Corporations'Act'and'for'all'other' purposes,'the'Shareholders'of'the'Company'approve:''

a.' the'issue'of:'
i.' up'to'225,000,000'First'Placement'SharesP'
ii.' up'to'175,000,000'First'Placement'OptionsP'
iii.' up'to'50,000,000'Second'Placement'SharesP'and''
iv.' 50,000,000'Management'Options,'

to'the'Syndicate'(or'its'nominees)P'and'

b.' the'acquisition'of'a'relevant'interest'in'the'issued'voting'Shares'of'the'Company' by' the' Syndicate' (or' its' nominees)' in' excess' of' the' threshold' prescribed' by' section'606(1)'of'the'Corporations'Act,'on'the'terms'and'conditions,'

all'of'which'are'described'in'the'Explanatory'Statement'which'accompanies'and'forms' part'of'the'Notice'of'Meeting.”'

Voting) power) of) the) Syndicate) (or) its) nominees) :! As! set! out! in! Table! 5! in! the! Explanatory!Statement,!the!proposed!maximum!voting!power!of!the!Syndicate!(or!its! nominees)!on!a!fully!diluted!basis!is!80.88%.!

Independent)Expert’s)Report)(IER) :!Shareholders!should!carefully!consider!the!IER! prepared!by!Stantons!International!Securities!for!the!purpose!of!seeking!Shareholder! approval!required!under!section!611!(item!7)!of!the!Corporations!Act.!The!IER!comments! on! the! fairness! and! reasonableness! of! the! transaction! to! the! nonUassociated! Shareholders!of!the!Company!and!concludes!that!the!transaction!is!fair!and!reasonable.!

Voting)exclusion)statement:) The!Company!will!disregard!any!votes!cast!on!Resolution! 4!by:!

(a)! a!person!who!is!proposing!to!participate!in!the!issue]! (b)! 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!
(c)! an!associate!of!any!person!described!in!(a)!or!(b).!

However,!the!Company!need!not!disregard!a!vote!if:!

(i)! it! is! cast! by! a! person! acting! as! a! proxy! for! another! person! entitled! to! vote,! in! accordance!with!the!direction!on!the!proxy!form]!or!
(ii)' it!is!cast!by!the!person!chairing!the!meeting!( the)Chair )!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)–)RELATED)PARTY)APPROVAL)–)GREG)RUDDOCK)

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

“That,'subject'to'all'other'Resolutions'(other'than'Resolutions'13716'(inclusive))'being' passed,'for'the'purposes'of'section'208'of'the'Corporations'Act,'ASX'Listing'Rule'10.11' and'for'all'other'purposes,'the'Shareholders'of'the'Company'approve'the'issue'of:'

a.' up'to'20,000,000'First'Placement'A'SharesP'
b.' up'to'15,000,000'First'Placement'OptionsP'
c.' up'to'5,000,000'Second'Placement'SharesP'and'
d.' up'to'3,333,333'Management'Options,'

to'Greg'Ruddock'(or'his'nominee),'a'proposed'Director'of'the'Company,'on'the'terms' and' conditions' all' of' which' are' described' in' the' Explanatory' Statement' which' accompanies'and'forms'part'of'the'Notice'of'Meeting.”'

Voting)exclusion)statement:) The!Company!will!disregard!any!votes!cast!on!Resolution! 5!by:!

(a)! Mr!Ruddock!or!his!nominee]!
(b)! 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!
(c)! an!associate!of!any!person!described!in!(a)!or!(b).!

However,!the!Company!need!not!disregard!a!vote!if:!

(i)! it! is! cast! by! a! person! acting! as! a! proxy! for! another! person! entitled! to! vote,! in! accordance!with!the!direction!on!the!proxy!form]!or!
(ii)! it!is!cast!by!the!person!chairing!the!meeting!( the)Chair )!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)–)RELATED)PARTY)APPROVAL)–)JOSHUA)MCKEAN))

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

a.' up'to'20,000,000'First'Placement'A'SharesP'
b.' up'to'15,000,000'First'Placement'OptionsP'
c.' up'to'5,000,000'Second'Placement'SharesP'and'
d.' up'to'3,333,333'Management'Options,'

to'Joshua'McKean''(or'his'nominee),'a'proposed'Director'of'the'Company,'on'the'terms' and' conditions' all' of' which' are' described' in' the' Explanatory' Statement' which' accompanies'and'forms'part'of'the'Notice'of'Meeting.”''

Voting)exclusion)statement:) The!Company!will!disregard!any!votes!cast!on!Resolution! 6!by:!

(a)! Mr!McKean!or!his!nominee]!
(b)! 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!
(c)! an!associate!of!any!person!described!in!(a)!or!(b).!

However,!the!Company!need!not!disregard!a!vote!if:!

(i)! it! is! cast! by! a! person! acting! as! a! proxy! for! another! person! entitled! to! vote,! in! accordance!with!the!direction!on!the!proxy!form]!or!
(ii)! it!is!cast!by!the!person!chairing!the!meeting!( the)Chair )!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)–)RELATED)PARTY)APPROVAL)–)GLEN)DOBBIE)

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

a.' up'to'45,000,000'First'Placement'A'SharesP'
b.' up'to'36,600,000'First'Placement'OptionsP'
c.' up'to'11,250,000''Second'Placement'SharesP'and'
d.' up'to'13,942,856'Management'Options,'

to'Glen'Dobbie'(or'his'nominee),'a'proposed'Director'of'the'Company,'on'the'terms'and' conditions'all'of'which'are'described'in'the'Explanatory'Statement'which'accompanies' and'forms'part'of'the'Notice'of'Meeting.”'

Voting)exclusion)statement:) The!Company!will!disregard!any!votes!cast!on!Resolution! 7!by:!

(a)! Mr!Dobbie!or!his!nominee]!
(b)! 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!
(c)! an!associate!of!any!person!described!in!(a)!or!(b).!

However,!the!Company!need!not!disregard!a!vote!if:!

(i)! it! is! cast! by! a! person! acting! as! a! proxy! for! another! person! entitled! to! vote,! in! accordance!with!the!direction!on!the!proxy!form]!or!
(ii)! it!is!cast!by!the!person!chairing!the!meeting!( the)Chair )!as!proxy!for!a!person!who! is!entitled!to!vote,!in!accordance!with!a!direction!on!the!proxy!form!to!vote!as!the! proxy!decides.!

8.) RESOLUTION)8)–)RELATED)PARTY)APPROVAL)–)MALCOLM)KEEFE)

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

a.' up'to'20,000,000'First'Placement'A'SharesP'
b.' up'to'15,000,000'First'Placement'OptionsP'
c.' up'to'5,000,000'Second'Placement'SharesP'and'
d.' up'to'5,714,286'Management'Options,'

to'Malcolm'Keefe'(or'his'nominee),'a'proposed'Director'of'the'Company,'on'the'terms' and' conditions' all' of' which' are' described' in' the' Explanatory' Statement' which' accompanies'and'forms'part'of'the'Notice'of'Meeting.”'

Voting)exclusion)statement:) The!Company!will!disregard!any!votes!cast!on!Resolution! 8!by:!

(a)! Mr!Keefe!or!his!nominee]!
(b)! 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!
(c)! an!associate!of!any!person!described!in!(a)!or!(b).!

However,!the!Company!need!not!disregard!a!vote!if:!

(i)! it! is! cast! by! a! person! acting! as! a! proxy! for! another! person! entitled! to! vote,! in! accordance!with!the!direction!on!the!proxy!form]!or!
(ii)! it!is!cast!by!the!person!chairing!the!meeting!( the)Chair )!as!proxy!for!a!person!who! is!entitled!to!vote,!in!accordance!with!a!direction!on!the!proxy!form!to!vote!as!the! proxy!decides.!

9.) RESOLUTION)9)–)ELECTION)OF)MR)GREG)RUDDOCK)AS)A)DIRECTOR)

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

“That,'subject'to'all'other'Resolutions'(other'than'Resolutions'13716'(inclusive))'being' passed,'pursuant'to'clause'7.2''of'the'Company’s'constitution,'Mr'Greg'Ruddock,'being' eligible'and'having'consented'to'act,'be'elected'as'a'Director'of'the'Company,'effective' immediately'after'the'removal'and/or'resignation'of'the'current'Board'of'Directors.”''

10.) RESOLUTION)10)–)ELECTION)OF)MR)JOSHUA)MCKEAN)AS)A)DIRECTOR)

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

“That,'subject'to'all'other'Resolutions'(other'than'Resolutions'13716'(inclusive))'being' passed,'pursuant'to'clause'7.2'of'the'Company’s'constitution,'Mr'Joshua'McKean,'being' eligible'and'having'consented'to'act,'be'elected'as'a'Director'of'the'Company,'effective' immediately'after'the'removal'and/or'resignation'of'the'current'Board'of'Directors.”'

11.) RESOLUTION)11)–)ELECTION)OF)MR)GLEN)DOBBIE)AS)A)DIRECTOR)

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

“That,'subject'to'all'other'Resolutions'(other'than'Resolutions'13716'(inclusive))'being' passed,'pursuant'to'clause'7.2'of'the'Company’s'constitution,'Mr'Glen'Dobbie,'being' eligible'and'having'consented'to'act,'be'elected'as'a'Director'of'the'Company,'effective' immediately'after'the'removal'and/or'resignation'of'the'current'Board'of'Directors.”'

12.) RESOLUTION)12)–)ELECTION)OF)MR)MALCOLM)KEEFE)AS)A)DIRECTOR)

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

“That,'subject'to'all'other'Resolutions'(other'than'Resolutions'13716'(inclusive))'being' passed,'pursuant'to'clause'7.2'of'the'Company’s'constitution,'Mr'Malcolm'Keefe'being' eligible'and'having'consented'to'act,'be'elected'as'a'Director'of'the'Company,'effective' immediately'after'the'removal'and/or'resignation'of'the'current'Board'of'Directors.”''

13.) RESOLUTION)13)–)REPEAL)AND)ADOPTION)OF)A)CONSTITUTION)

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

“That,' subject' to' all' other' Resolutions' (other' than' Resolutions' 14,' 15' and' 16)' being' passed,'in'accordance'with'section'136'of'the'Corporations'Act,'the'constitution'of'the' Company' be' repealed' and' replaced' with' a' constitution' in' the' form' of' the' document' entitled'“Constitution'of'Navigator'Resources'Limited”'tabled'at'this'Meeting,'and'signed' by'the'Deed'Administrator'for'the'purposes'of'identification,'effective'immediately.”'

14.) RESOLUTION)14)–)REMOVAL)OF)AUDITOR)

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

“That,' subject' to' all' other' Resolutions' (other' than' Resolutions' 13,' 15' and' 16)' being' passed,' pursuant' to' section' 329' of' the' Corporations' Act' and' for' all' other' purposes,' approval' is' given' for' the' removal' of' HLB' Mann' Judd as' the' current' auditor' of' the' Company,'effective'immediately.”''

15.) RESOLUTION)15)–)APPOINTMENT)OF)AUDITOR)

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

“That,' subject' to' all' other' Resolutions' (other' than' Resolutions' 13,' 14' and' 16)' being' passed,'pursuant'to's'327'of'the'Corporations'Act'and'for'all'other'purposes,'having' been'nominated'by'a'Shareholder'and'consented'in'writing'to'act'in'the'capacity'of' auditor,'approval'is'given'for'the'appointment'of'PKF'Hacketts'Audit'(ABN'33'873'151' 348),'effective'immediately.”''

16.) RESOLUTION)16)–)INCREASE)NONdEXECUTIVE)DIRECTORS’)FEE)POOL)

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

“That,' subject' to' all' other' Resolutions' (other' than' Resolutions' 13,' 14' and' 15)' being' passed,'pursuant'to'ASX'Listing'Rule'10.17'and'for'all'other'purposes,'the'maximum' aggregate'amount'of'remuneration'that'may'be'paid'to'the'Company’s'non7executive' directors' in' any' financial' year' is' increase' by' $300,000,' from' $200,000' to' $500,000,' effective'immediately.”'

Voting) Exclusion) Statement:) The! Company! will! disregard! any! votes! cast! on! Resolution!16!by:

(a)! any! Directors! of! the! Company! or! an! associate! of! a! Director,! regardless! of! the! capacity!in!which!the!vote!is!cast]!and!
(b)! as!a!proxy!by!a!person!who!is!a!member!of!the!Company’s!KMP!at!the!date!of!this! Meeting!or!their!closely!related!parties.!

However,!the!Company!will!not!disregard!a!vote!if:!

(i)! 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!!
(ii)! it!is!cast!by!the!Chair!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.!

EXPLANATORY)STATEMENT)

This!Explanatory!Statement!has!been!prepared!for!the!information!of!the!Shareholders!in! connection!with!the!business!to!be!conducted!at!the!Extraordinary!General!Meeting!to!be!held! at!10:30AM!(AWST)!on!21!January!2016!at!Otsana!Capital,!108!Outram!Street,!West!Perth,! WA.!!

Shareholders!should!read!this!Explanatory!Statement!in!full!because!individual!sections!do! not!give!a!comprehensive!review!of!the!Resolutions.!In!addition,!this!Explanatory!Statement! should!be!read!in!conjunction!with!the!accompanying!Notice!and!the!Independent!Expert’s! Report!prepared!by!Stantons!International!Securities!Pty!Ltd!(ACN!128!908!289)!trading!as! Stantons!International!Securities!( Stantons )!contained!in!Annexure!A.!

The!purpose!of!this!Explanatory!Statement!is!to!provide!information!which!the!New!Board! believe!to!be!material!to!Shareholders!in!deciding!whether!or!not!to!pass!the!Resolutions!in! the!Notice!of!Meeting.!

If!you!are!in!any!doubt!about!what!to!do!in!relation!to!the!Resolutions!contemplated!in!the! Notice!of!Meeting!and!this!Explanatory!Statement,!it!is!recommended!that!you!seek!advice! from!an!accountant,!solicitor!or!other!professional!advisor.!

Full!details!of!the!business!to!be!considered!at!the!Extraordinary!General!Meeting!are!set!out! below.!

Background)to)the)Recapitalisation

1.) Summary)of)the)terms)of)the)Proposal)

The!Proposal!involves:!

(a)! The!Syndicate!arranging!for!the!injection!of!approximately!$!2,000,250!of!cash!into! the!Company!in!return!for!an!issue!of!fully!paid!ordinary!shares!in!the!Company! representing!an!interest!of!approximately!80.88%!of!the!total!issued!capital!of!the! Company!(on!a!fully!diluted!basis).
(b)! The!Company!retaining,!all!of!the!unencumbered!assets!of!NAV!including!all!of! the! Company’s! remaining! assets! including! but! not! limited! to! NAV’s! Cummins! Range!project,!consisting!of!one!exploration!licence!E80/2232!which!is!100%!held! by!the!Company,!and!covering!an!area!of!48.5!kilometres,!located!130!kilometres! southwest! of! Halls! Creek! in! the! East! Kimberly,! Western! Australia! ( Cummins) Range) Project ),! registered! business! names,! intellectual! property,! goodwill,! domain!names,!websites,!customer/supplier!lists,!any!remaining!contracts!(where! agreed! by! the! Syndicate),! and! all! other! assets! to! operate! the! business! ( NAV) Business )! be! retained! by! NAV.! The! NAV! Business! must! remain! as! an! unencumbered!asset!of!the!Company!to!enable!the!Company!to!be!reinstated!to! trading!on!the!Australian!Securities!Exchange!Limited!( ASX ).!In!addition,!all!other! liabilities!and!obligations!of!the!Company!are!to!be!released!pursuant!to!the!terms! of!the!DOCA.
(c)! The!Company!making!a!payment!of!$615,000!to!pay!to!the!Deed!Administrator!for! the!benefit!of!the!Creditors!Trust!( Creditor)Payment )!for!control!of!NAV!and!100%! of!the!NAV!Business.!All!other!liabilities!and!obligations!of!the!Company!up!until! the!appointment!of!the!Administrator!will!be!compromised!under!the!DOCA.

(d)! The!Company!raising!new!equity!by!way!of!the!following!placements!(which!will! be!made!pursuant!to!a!prospectus!and!as!noted!in!paragraph!(a)!above:
(i)! a!first!placement!of:
- (A)! 225! million! fully! paid! ordinary! shares! in! the! Company! ( First) Placement)Shares ),!issued!in!two!tranches,!at!an!issue!price!of:
  - a.) 200,000,000!shares!( First)Placement)A)Shares )!at!$0.0025!per! share!to!raise!$500,000!to!Auxano!(or!its!nominees)!and!other! investors! that! are! invited! by! the! Company! as! part! of! the! Proposal]!and
  - b.) 25,000,000!shares!( First)Placement)B)Shares )!at!$0.00001!per! share! to! raise! $250! to! Otsana! (or! its! nominees)! and! other! investors! that! are! invited! by! the! Company! as! part! of! the! Proposal]!and
- (B)! up!to!150,000,000!Options!to!each!subscribe!for!one!(1)!Share!in!the! Company!to!Auxano!!(or!its!nominees)!and!other!investors!that!are! invited! by! the! Company! as! part! of! the! Proposal! ( First) Placement) Options )! for! nil! consideration,! with! each! First! Placement! Option! exercisable!at!$0.01!expiring!3!years!from!the!date!of!issue]!and!
- (C)! up!to!25,000,000!Options!to!each!subscribe!for!one!(1)!Share!in!the! Company!to!Otsana!!(or!its!nominees)!and!other!investors!that!are! invited! by! the! Company! as! part! of! the! Proposal! ( First) Placement) Options )! for! nil! consideration,! with! each! First! Placement! Option! exercisable!at!$0.01!expiring!3!years!from!the!date!of!issue,!

(issue! of! First! Placement! Shares! and! First! Placement! Options! collectively!referred!to!as!the! First)Placement )!

(ii)! a!second!placement!of!up!to!150!million!fully!paid!ordinary!shares!in!the! Company! ( Second) Placement) Shares )! at! an! issue! price! of! $0.01! per! Second!Placement!Share!to!raise!up!to!$1,500,000!to!general!investors,!that! may! include! members! of! the! Syndicate! (or! its! nominees)! ( Second) Placement ).

A!total!of!up!to!105,000,000!First!Placement!A!Shares,!up!to!81,600,000! First!Placement!Options!and!up!to!26,250,000!Second!Placement!Shares! and!26,323,808!management!options!(collectively!referred!to!as!the! Related) Party)Securities ) are!proposed!to!be!placed!to!the!proposed!Directors!(or! their! nominees)! referred! to! in! Resolutions! 5,! 6,! 7! and! 8! inclusive! in! this! Notice!of!Meeting.!

Note:!completion!of!the!Proposal!is!conditional!on!the!capital!raising.

(e)! Subject!to!Shareholder!approval!being!obtained!for!the!Proposal!under!this!Notice! of!Meeting,!all!existing!Directors!and!officers!of!the!Company!being!either!removed! by!the!Deed!Administrator!or!resigning!from!the!Company.

(f)! Subject!to!Shareholder!approval!being!obtained!for!the!Proposal!under!this!Notice! of!Meeting,!the!proposed!Directors,!Greg!Ruddock,!Joshua!McKean,!Glen!Dobbie! and!Malcolm!Keefe!being!appointed!to!the!Board!of!the!Company!(collectively! known!as!the! New)Board ).!Resolutions!9,!10,!11!and!12!inclusive!in!this!Notice!of! Meeting!seek!Shareholder!approval!for!these!appointments.
(g)! The!Company!making!available!any!cash!at!bank,!its!rights!in!its!sundry!debtors! (and! any! other! assets! not! purchased! by! the! Syndicate)! for! the! benefit! of! the! Creditors!pursuant!to!the!terms!of!the!DOCA.!
(h)! Immediately! following! the! satisfaction! of! the! general! conditions! set! out! under! Section!2!below,!the!Deed!Administrator!facilitating!all!necessary!and!assignments! to! the! Creditors! Trust,! including! payments! totalling! $615,000! and! the! DOCA! terminating!thereafter!by!performance.!
(i)! In!the!event!that!the!Proposal!and!the!Resolutions!under!this!Notice!of!Meeting! are!not!approved!by!Shareholders!of!the!Company,!the!DOCA!terminating!and!the! Company!being!placed!into!liquidation,!or!possibly!pursuing!other!proposals.
(j)! In!the!event!that!the!Proposal!and!the!Resolutions!under!this!Notice!of!Meeting! are!approved!by!Shareholders!of!the!Company,!with!all!other!conditions!precedent! being!satisfied,!the!Creditor!Payment!will!be!paid!from!the!proceeds!under!the! capital!raising,!and!the!DOCA!will!be!effectuated.
(k)! The! control! of! the! Company! remaining! with! the! Deed! Administrator! until! the! termination!of!the!DOCA.
(l)! The! Syndicate! changing! the! Constitution! of! the! Company! (as! proposed! by! Resolution!13!of!this!Notice)!and!the!auditor!of!the!Company!(as!proposed!by! Resolutions!14!and!15!of!this!Notice).
(m)! The!Syndicate!increasing!the!nonUexecutive!directors’!fee!pool!(as!proposed!in! Resolution!16!of!this!Notice).!

2.) Summary)of)the)conditions)of)the)Proposal)

In!addition!to!the!required!Shareholder!approvals!(as!detailed!in!this!Notice),!the!Proposal!is! also!subject!to!the!following!general!conditions!precedent:

(a)! all!liabilities!and!long!term!commitments!of!the!Company!as!at!settlement!of!the! Proposal!being!released!and!compromised!via!a!DOCA!that!reflects!the!terms!of! the!offer!made!by!the!Syndicate]!!
(b)! all!creditors!will!be!required!to!prove!debts!against!the!Trustee!of!the!Creditors’! Trust!as!if!they!were!the!Company!and!payments!to!creditors!shall!be!made!in! accordance!with!the!DOCA!and!the!Creditors’!Trust!deed]!
(c)! ASX!providing!written!confirmation!to!the!Company!that!it!will!lift!the!suspension! on!the!trading!of!the!securities!of!the!Company!immediately!following!completion! of!the!capital!raisings!without!the!need!to!reUcomply!with!Chapters!1!and!2!of!the! Listing!Rules!on!finalising!the!DOCA.!The!Syndicate!will!assist!in!seeking!such! confirmations!from!the!ASX]!
(d)! The!receipt!of!shareholder!approval!with!respect!to!the!terms!of!the!proposal!which! is!being!sought!under!this!Notice!of!Meeting]!and!

(e)! The!deUregistration!and!removal!of!all!securities!interests!over!the!Company!and! its!assets!on!the!Personal!Property!Securities!Register!before!or!in!conjunction! with!the!payment!of!the!Creditor!Payment.!

General!conditions!(a)!–!(b)!above!will!be!satisfied!at!the!point!the!DOCA!is!effectuated,!which! would! be! shortly! after! this! Meeting! takes! place.! The! Company! has! received! written! confirmation!from!the!ASX!satisfying!general!condition!(c).!!!

3.) Proposed)prodforma)capital)structure)of)the)Company)

The! proposed! capital! structure! of! the! Company! following! completion! of! the! Proposal! is! summarised!below:!

Table)1)–)Proposed)prodforma)capital)structure)

Capitalstructure	Shares	UnlistedOptions
ExistingShares	18,223,695
FirstPlacementSecurities(Resolution1)(a)	225,000,000	175,000,000
SecondPlacementSecurities(Resolution2)(b)	150,000,000	U
ManagementOptions(Resolution3)	U	50,000,000
CompletionofallResolutions	393,223,695	225,000,000

Notes:)

(a)!!The!First!Placement!Securities!include!the!issue!of!the!Securities!to!the!Related!Parties!and!Syndicate!pursuant! to!Resolutions!4!–!8!of!this!Notice.!

(b)!!Assumes!that!the!Second!Placement!is!fully!subscribed.!The!Second!Placement!Securities!include!the!issue! of!the!Related!Party!Securities!to!the!Directors!pursuant!to!Resolutions!4!–!8!of!this!Notice!and!others.

4.) Proposed)business)strategy)and)use)of)funds)raised)by)the)Company)

Business)Strategy

The!Company’s!exploration!project,!Cummins!Range!Project,!is!located!130km!southwest!of! Halls!Creek!in!the!East!Kimberly,!Western!Australia.!The!project!consists!of!one!exploration! licence,!E80/2232,!which!covers!an!area!of!48.5!square!kilometres,!and!is!100%!held!by!the! Company.!!

The!Cummins!Range!Project!is!hosted!within!the!Cummins!Range!carbonatite!pipe,!a!905Ma! diatreme!pipe!forming!part!of!a!small!alkaline!intrusive!complex!located!near!the!junction!of! the!Halls!Creek!Orogen!and!the!King!Leopold!Orogen.!

In!May!2011!an!ultraUdetailed!aeromagnetic!survey!was!performed!over!the!Cummins!Range! pipe!and!surrounding!country!rock!was!flown!in!July!2011!at!an!altitude!of!20!metres!and!with! a!total!of!2,000!line!kilometres.!

Following!on!from!the!airborne!survey!a!closed!spaced!ground!gravity!survey!was!completed! at!a!station!spacing!of!100!metres!by!50!metres!over!the!central!portion!of!the!pipe,!expanding! to! 200! metres! by! 100! metres! over! the! adjacent! country! rock! to! establish! background! parameters.!In!total,!3,400!gravity!stations!were!collected.!

During!July!2011,!an!augerUsampling!program!was!carried!out!on!a!grid!of!500!metres!by!100! metres!to!a!depth!of!2!metres!over!the!entire!tenement!area.!The!grid!spacing!was!reduced! to!100!metres!by!100!metres!over!the!Cummins!Range!pipe.!A!total!of!1,297!samples!were! collected! and! analysed! for! rare! earth! elements,! resulting! in! the! identification! of! give! geochemical!anomalies!(threshold!200ppm!TREO).!Four!of!the!five!are!located!within!the! Cummins!Range!pipe.!!

Exploration!was!then!progressed!with!an!RC!drilling!programme!in!September!and!October! 2011,!consisting!of!77!holes!totalling!4,230!metres.!aimed!at!extending!and!upgrading!the! existing!Inferred!resource.!The!drilling!has!confirmed!a!northwestUsoutheast!trend!of!REO! mineralisation!that!runs!parallel!to!the!regional!structural!fabric!of!the!country!rock!surrounding! the!Cummins!Range!pipe.!The!deposit!is!interpreted!to!be!structurally!controlled!by!a!central! shear!zone,!which!allowed!for!the!carbonate!intrusion!and!a!deeper!weathering!profile.!

The!RC!drilling!has!also!confirmed!low!levels!of!thorium!in!the!Cummins!Range!resource,!with! an!average!of!42!ppm!Th!within!the!current!resource.!!

A!large!composite!sample!was!prepared!from!a!range!of!selected!drill!samples!from!the!2011! RC!drilling!campaign!for!metallurgical!testwork!and!associated!mineralogical!study!work!to!be! carried!out!in!Australia.!The!testwork!was!conducted!to!determine!the!potential!upgradeability! (into!concentrate)!and!to!generate!an!understanding!of!the!mineralogical!distribution,!liberation! and!deportment!of!rare!earths!within!the!mineralisation!for!process!flowsheet!development! and!economic!assessment.!!

Mineral'Resources''

At!a!cutUoff!grade!of!1.0%!TREO,!an!Inferred!mineral!resources!of!4.17Mt!at!an!average!grade! of!1.72%!TREO,!11.0%!P205!and!187!ppm!U308!was!estimated!for!the!Cummins!Range! Project!projected!by!Hellman!&!Schofield!Pty!Ltd!in!September!2009,!using!results!from!the! 2007!RC!drilling.!

Following!the!completion!of!the!2011!RC!drilling!programme,!a!mineral!resource!updated!was! reported!by!Hellman!&!Schofield!Pty!Ltd!in!2012!using!the!combined!2007!and!2011!datasets.! As!part!of!the!update!an!improved!geological!model!was!used!to!define!the!wireframes!used! in! the! estimation! process.! Grades! were! estimated! using! ordinary! kriging,! with! the! search! ellipse!orientated!parallel!to!the!primary!structural!control.!

Bulk!density!data!was!obtained!from!reliable!downhole!density!measurements!to!generate!a! density!provide!for!the!regolith.!Density!data!was,!however,!only!obtained!from!the!northwest! quadrant!of!the!resource!area!and!was!extrapolated!over!the!whole!block!model.!!

In!2012,!mineral!resources,!reported!above!a!1.0%!TREO!cutUoff!grade,!are!summarised!in! the!table!below.!The!additional!drilling!has!resulted!in!a!17%!tonnage!increase!with!a!nominal! grade!increase.!

Table)2:)Cummins)Range)Mineral)Resources)above)a)1%)TREO)cutdoff)

Year	Category	Tonnage (Mt)	REO(%)	P205(%)	U308(ppm)	Th(ppm)	TotalREO (kt)
2009	Inferred	4.17	1.72	11.0	187	41	72
2012	Inferred	4.90	1.74	11.2	145	48	85
Change		+17%	+1%	+2%	U22%	+18%	+18%

The!resources!still!remain!in!the!Inferred!category!due!to!the!lack!of!distribution!of!density! measurements!throughout!the!deposit!and!sample!recovery!issues!experienced!during!the! 2011!RC!drilling!program.!A!conversion!from!Inferred!to!Indicated!classification!is!dependent! on!confirmatory!additional!fieldwork!including!density!measurements.!!

After!reinstatement,!it!is!the!New!Board’s!intention!that!the!Company!complete!a!desktop! geological! review! and! verification! of! existing! exploration! data! with! a! view! to! planning! an! exploration!and!drilling!program!to!expand!mineral!resources!and!improve!its!classification.!!

The!Company!will!also!consider!the!acquisition!and!development!of!any!other!investments,! both!within!its!broader!industry!sector!as!well!as!in!unrelated!market!segments,!as!identified! by! the! Company! and! always! subject! to! compliance! with! the! ASX! Listing! Rules! and! the! Corporations!Act.!

Report)on)Cummins)Range)Rare)Earth)Deposit.))

Included!below!is!a!report!prepared!by!H&S!Consultants!Pty!Ltd.!This!has!been!prepared!for! the!purpose!of!updating!the!resources!estimate!of!the!Cummins!Range!Project!resource,!and! to!comply!with!the!Joint!Ore!Reserves!Committee!( JORC )!2012!standards.!Please!refer!to! this!report!for!further!information!regarding!the!most!recent!estimates!of!the!Cummins!Range! Project!resource.!!

Resource Estimates - Cummins Range Rare Earth Deposit

H&S Consultants Pty Ltd has been requested by Navigator Resources Limited to update the reporting of the Cummins Range resource estimates to JORC (2012) standards. Previously reported estimates by Kimberley Rare Earths (“KRE”, 2012) are tabulated below and were classified as Inferred.

TREOY Cut-off (%)	Tonnes (Mt)	TREOY (%)	U3O8 (ppm)	ThO2 (ppm)	P2O5 (%)	Total REOY (kt)
0.5	10.8	1.2	100	47	10.2	127
1.0	4.9	1.7	145	48	11.2	85

TREOY = TREO + Y2O3 and refers total rare earth oxides including yttrium oxide.

These estimates are re-stated below at a range of cut-off grades including the 0.5% and 1.0% cut-offs, purely for comparison with previously reported figures. For reasons discussed in Table 1 of Appendix 1, these cut-offs are considered too low and the classification of an Inferred Resource is now considered only to apply to cut-off grades above 2.5% TREOY.

TREOY Cut-off (%)	Zone	Tonnes (Kt)	TREOY (%)	TLREO (%)	THREOY (%)	U3O8 (ppm)	ThO2 (ppm)	P2O5 (%)	Total REOY (Kt)
1.00	Transitional	4,705	1.74	1.7	0.06	147	48	11.4	81.8
	Oxide	178	1.84	1.7	0.07	113	47	6.1	3.3
	Alluvial	13	1.32	1.2	0.04	79	36	6.1	0.2
	Total	4,896	1.74	1.7	0.06	145	48	11.2	85.2
1.50	Transitional	2,264	2.31	2.2	0.08	192	55	11.8	52.3
	Oxide	89	2.47	2.3	0.09	169	62	7.1	2.2
	Alluvial	2	1.94	1.6	0.07	161	49	3.0	0.0
	Total	2,355	2.31	2.2	0.08	191	55	11.6	54.5
2.00 2.50 3.00	Transitional	1,162	2.87	2.7	0.10	240	62	11.8	33.4
	Oxide	59	2.85	2.6	0.10	202	66	7.5	1.7
	Alluvial	1	2.18	1.6	0.09	208	55	3.1	0.03
	Total	1,223	2.87	2.7	0.10	238	63	11.5	35.1
	Transitional	649	3.39	3.2	0.12	275	68	11.8	22.0
	Oxide	38	3.20	3.0	0.11	230	71	8.2	1.2
	Alluvial	0.01	2.74	2.2	0.08	175	53	5.1	0.0004
	Total	687	3.38	3.2	0.11	273	68	11.6	23.2
	Transitional	386	3.84	3.6	0.13	301	73	12.0	14.8
	Oxide	25	3.44	3.2	0.12	254	75	8.9	0.9
	Total	411	3.82	3.6	0.13	298	73	11.8	15.7
3.50	Transitional	224	4.28	4.0	0.14	326	76	11.9	9.6
	Oxide	10	3.79	3.7	0.14	301	86	9.8	0.4
	Total	234	4.26	4.0	0.14	325	76	11.8	10.0
4.00	Transitional	121	4.75	4.5	0.15	341	80	11.8	5.7
	Oxide	2	4.22	4.4	0.17	341	100	9.4	0.1
	Total	123	4.74	4.5	0.15	341	81	11.8	5.8

Inferred Resources only apply to cut-offs greater than and including 2.5% TREOY. Figures may not sum due to rounding. TREO = total rare earth oxides, TREOY = TREO + Y2O3 and refers total rare earth oxides including yttrium oxide. LREO = light REO (La – Nd), THREOY = total heavy rare earth oxides (Sm – Lu) including Y2O3. Decimal places do not imply precision.

The Cummins Range REE project is located 130km southwest of Halls Creek in the East Kimberley, Western Australia. The mineralisation is interpreted to have resulted from supergene processes over a primary carbonatite deposit similar to Mt Weld.

A total of 21 Air-core and 170 Reverse Circulation (RC) drill holes were used for the Mineral Resource estimation. The majority of samples were taken on 1m intervals and sub-sampled using a riffle splitter. Exact details of the subsampling technique used for the 77 Kimberly Rare Earths RC drill holes are not known. Samples were sent to Genalysis Laboratory Services, Perth, Western Australia where they underwent sample preparation and peroxide fusion digest followed by ICP-OES and ICP-MS analysis.

The TREO+Y2O3, TLREO, THREO, U3O8, ThO2 and P2O5 concentrations were estimated using Ordinary Kriging in the geostatistical software GS3. Wireframes encompassing zones over a nominal 0.3% TREOY were constructed and used as a hard boundary so that only samples from within the wireframes were used to estimate blocks within the wireframes.

The entire Mineral Resource is classified as Inferred. Drill holes are on a generally regular grid with a nominal spacing of 50m E-W and 40m N-S. This classification takes into account all relevant factors including relative confidence in tonnage/grade estimations, reliability of input data, confidence in continuity of geology and metal values, quality, quantity and distribution of the data. The flat-lying, shallow nature of the mineralisation makes it amenable to openpitting.

Preliminary non-optimised metallurgical results based on flotation and Wet High Intensity Magnetic Separation (“WHIMS”) resulted in a 4.8 times upgrade from 3.55% TREO to a concentrate with 17% TREO, representing a recovery of 50% of the feed TREO. It should be noted that the head grade of this sample is significantly higher than the average grade of the deposit.

Figure 1 illustrates the ranking, in terms of contained metal content, of Cummins Range in relation to over 50 world-wide rare earth deposits. Given that the deposit is described as dominantly monazite-hosted mineralisation it is unlikely to offer any obvious advantages in terms of metallurgical processing to other similar deposits.

==> picture [408 x 262] intentionally omitted <==

----- Start of picture text -----

1.0% REOY
>0.5% REOY
----- End of picture text -----

Figure 1. Distribution of contained metal in world-wide rare earth deposits. Arrows mark Cummins Range metal contents above 0.5% and 1.0% rare earth levels. Black bars mark the Mountain Pass and Mt Weld deposits.

Figure 2 illustrates the ranking, in terms of grade, of Cummins Range in relation to over 50 world-wide rare earth deposits. The arrow marks Cummins Range grade above a 1.0% REOY cut-off. Section 20 of JORC

(2012) defines a resource as having “reasonable prospects for eventual economic extraction”. It is clear from Figures 1 and 2 that the combination of grade and total metal content of Cummins Range suggests that there are many other more attractive rare earth deposits in the world. However, it is possible that metallurgical testing may discover some advantage to Cummins Range. At this stage, in the absence of advanced test-work this is not guaranteed and remains speculative. The ratio of light rare earth element oxides to heavy rare earth oxides (including yttrium) is 29 which defines the Cummins Range deposit as a light rare earth enriched deposit similar to Ngualla (Tanzania) and Mt Weld (WA). These two deposits are, however, considerably higher in grade and greater in tonnage than Cummins Range.

==> picture [390 x 265] intentionally omitted <==

Figure 2. Distribution of grades in world-wide rare earth deposits. Solid arrow marks Cummins Range metal contents above 1.0% rare earth levels. Black bars mark the Mountain Pass and Mt Weld deposits. The grade of Cummins Range above 2.5% TREOY is 3.38% and is shown by an open arrow.

Appendix 1 JORC Code, 2012 Edition – Table 1 Cummins Range REE Deposit

Section 1 Sampling Techniques and Data

(Criteria in this section apply to all succeeding sections.)

Criteria	JORC Code explanation	Commentary	Commentary
Sampling	 Nature and quality of sampling (e.g. cut channels, random chips, or		A total of 21 Air-core and 170 Reverse Circulation (RC) drill holes were used
techniques	specific specialised industry standard measurement tools appropriate		for the Mineral Resource estimation.
	to the minerals under investigation, such as down hole gamma		Samples from the Navigator RC (93) drill holes were collected both as 4m
	sondes, or handheld XRF instruments, etc.). These examples should not be taken as limiting the broad meaning of sampling.  Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used.  Aspects of the determination of mineralisation that are Material to the Public Report.  In cases where ‘industry standard’ work has been done this would be relatively simple (e.g. ‘reverse circulation drilling was used to obtain 1 m samples from which 3 kg was pulverised to produce a 30 g charge for fire assay’). In other cases more explanation may be required,	 	composites for initial assaying and as 1m samples for follow up assaying of anomalous mineralised zones as defined by the 4m composites. Dry 4m composite samples were spear sampled using a PVC tube and wet 4m composite samples were taken using an aluminium scoop. The 1m samples were collected via a 9:1 riffle splitter. All samples from the 21 Navigator air-core drill holes in the resource estimate were sampled on one metre intervals and sub-sampled using a riffle splitter. Samples from the 77 Kimberly Rare Earths Ltd (KRE) RC drill holes were taken on 1m drill intervals. Exact details of the sample preparation are not known.
	such as where there is coarse gold that has inherent sampling		Both the Navigator and KRE samples were sent to Genalysis Laboratory
	problems. Unusual commodities or mineralisation types (e.g.		Services, Perth, Western Australia. Exact details of the sample preparation
	submarine nodules) may warrant disclosure of detailed information.		employed by Genalysis are not known.
			For the Navigator RC drill holes; the 4m composite samples underwent a 4
			acid digest followed by ICP-OES (inductively coupled plasma optical emission
			spectrometry) and ICP-MS (inductively coupled plasma mass spectrometry)
			analysis.
			The 1m Navigator RC and air-core split samples and all the KRE samples
			underwent a peroxide fusion digest followed by ICP-OES and ICP-MS
			analysis.
Drilling	 Drill type (e.g. core, reverse circulation, open-hole hammer, rotary air		Between 1978 and 1985 CRA Exploration Pty Ltd (CRAE) drilled the Cummins
techniques	blast, auger, Bangka, sonic, etc.) and details (e.g. core diameter,		Range deposit with a total of 123 drill holes comprised of air-core, auger
	triple or standard tube, depth of diamond tails, face-sampling bit or		holes, Rotary Air Blast (RAB) holes and two diamond drill holes. These data
	other type, whether core is oriented and if so, by what method, etc.).		were not used in the resource estimation due to unreliability of the assay
			and sampling (Weir,1989) and are therefore not discussed further.

Criteria	JORC Code explanation	Commentary	Commentary
			Navigator Resources (Navigator) drilled a total of 21 air-core and 93 Reverse
			Circulation (RC) drill holes between 2007 and 2008. The RC drill holes were
			drilled with a 5.25 inch face sampling bit. No record of the core diameter of
			the air-core drill holes could be found.
			Kimberly Rare Earths Ltd (KRE) drilled a total of 77 RC drill holes into the
			Cummins Range deposit. No record of the hole diameter or sampling bit
			details could be found but it is assumed that a 5.25 inch face sampling
			hammer was used.
			No oriented core
Drill sample	 Method of recording and assessing core and chip sample recoveries		No record of the recovery of the Navigator or KRE drill holes could be found.
recovery	and results assessed.		Navigator report that most holes had good recovery although it is noted that
	 Measures taken to maximise sample recovery and ensure		some holes encountered high ground water flows and karst-type weathering
	representative nature of the samples.		voids.
	 Whether a relationship exists between sample recovery and grade		It is assumed that no bias was introduced due to loss/gain of drill sample.
	and whether sample bias may have occurred due to preferential
	loss/gain of fine/coarse material.
Logging	 Whether core and chip samples have been geologically and		Logging of all Navigator and KRE holes was carried out over 1m intervals
	geotechnically logged to a level of detail to support appropriate		using both quantitative and qualitative descriptions. The recorded details
	Mineral Resource estimation, mining studies and metallurgical		included: lithology, grainsize, weathering, colour, alteration, sulphide
	studies.		quantity and type, structure and veining. Logs are qualitative in nature.
	 Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc.) photography.  The total length and percentage of the relevant intersections logged.	 	The level of detail contained in the drill hole logs is considered to be appropriate to support reporting of Inferred Mineral Resources. No photographs of Navigator of KRE drill holes were available to H&SC.
			The total length of the intersections logged in the Navigator and KRE holes
			is 13,185m,equivalent to 94% of the length of Navigator and KRE drill holes.
Sub-sampling	 If core, whether cut or sawn and whether quarter, half or all core		The Navigator RC drill hole samples were collected both as 4m composites
techniques	taken.		for initial assaying and as 1m samples for follow up assaying of anomalous
and sample	 If non-core, whether riffled, tube sampled, rotary split, etc. and		mineralised zones defined by the 4m composites. Dry 4m composite
preparation	whether sampled wet or dry.		samples were spear sampled using a PVC tube and wet 4m composite
	 For all sample types, the nature, quality and appropriateness of the		samples were taken using an aluminium scoop. The 1m samples were
	sample preparation technique.		collected via a 9:1 riffle splitter.
	 Quality control procedures adopted for all sub-sampling stages to maximise representivity of samples.  Measures taken to ensure that the sampling is representative of the in situ material collected, including for instance results for field duplicate/second-half sampling.  Whether sample sizes are appropriate to thegrain size of the material	  	All the Navigator air-core samples used in the resource estimate were sampled on one metre intervals and sub-sampled using a riffle splitter. The KRE downhole sampling interval is 1m. It is assumed that a riffle splitter was used to separate the sample for analysis. The majority of the samples were sampled dry.

Criteria	JORC Code explanation	Commentary	Commentary
	being sampled.		No information regarding the procedures adopted for sub-sampling stages
			to maximise representivity of samples was available.
			KRE submitted one field duplicate from each RC hole drilled.
			No details are available for sample preparation in the laboratory.
			The drilling sample sizes are considered to be appropriate for the grain size
			of the mineralisation.
Quality of	 The nature, quality and appropriateness of the assaying and		The Navigator and KRE drill holes were assayed by Genalysis.
assay data	laboratory procedures used and whether the technique is considered		For the Navigator drill holes; the 4m composite samples underwent a 4 acid
and laboratory tests	partial or total.  For geophysical tools, spectrometers, handheld XRF instruments, etc., the parameters used in determining the analysis including instrument make and model, reading times, calibrations factors applied and their derivation, etc.  Nature of quality control procedures adopted (e.g. standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (i.e. lack of bias) and precision have been established.		digest followed by ICP-OES (inductively coupled plasma optical emission spectrometry) and ICP-MS (inductively coupled plasma mass spectrometry) analysis. The 1m Navigator split samples and all the KRE samples underwent a peroxide fusion digest followed by ICP-OES and ICP-MS analysis. All samples were assayed for a large suite of elements including the rare earth elements. The assaying and laboratory procedures are considered appropriate for the style of mineralisation.
			Navigator did not conduct any QAQC such as use of certified reference
			materials, blanks, field duplicates, crush duplicates, pulp duplicates or inter-
			laboratory checks.
			KRE submitted 378 of the Navigator samples to Genalysis to cross-check the
			original assays. No assessment of this test work has been seen by H&SC.
			Throughout the KRE drilling campaign acid and control blanks, certified
			reference materials and field duplicates were submitted with the drill hole
			samples. H&SC was provided with a QAQC report that appeared to have
			been computer generated with little to no analysis of the outcomes of the
			QAQC results. It would appear that the QAQC results were not monitored or
			acted upon at the time of receipt.
			H&SC briefly reviewed the QAQC report and conclude that, although there
			are issues with individual assays, the level of confidence in the assay data is
			sufficient for an Inferred Resource.
Verification of	 The verification of significant intersections by either independent or		SRK (2011) personnel reviewed the two CRAE diamond drill holes as part of
sampling and	alternative company personnel.		their site visit in January 2011. The weathered zones were reportedly clearly
assaying	 The use of twinned holes.		defined.
	 Documentation of primary data, data entry procedures, data		No twinned holes have been drilled.
	verification, data storage (physical and electronic) protocols.		A small number of samples had not been assayed for the full suite of REO.
	 Discuss any adjustment to assay data.		H&SC used the correlations between the elements to calculate the missing

Criteria	JORC Code explanation	Commentary	Commentary
			values using regressions. Missing Gd, Tb, Dy, Ho, Er, Tm, Yb, Lu, were
			calculated using a regression with assayed Eu values and missing Pr, Nd and
			Sm concentrations were calculated usinga regression with Ce.
Location of	 Accuracy and quality of surveys used to locate drill holes (collar and		The Navigator drill hole collar positions were picked up using a Differential
data points	down-hole surveys), trenches, mine workings and other locations		Global Positioning System (DGPS) unit with an accuracy of +/- 1m. No record
	used in Mineral Resource estimation.		of the type of DGPS unit used could be found.
	 Specification of the grid system used.		The collar positions of the KRE holes were recorded by Whelans, a specialist
	 Quality and adequacy of topographic control.		surveying company. The method of surveying the collar positions could not
			be found but it is assumed that a DGPS unit with an accuracy of +/-10cm was
			used.
			Location methods used to determine accuracy of drill hole collars is
			considered appropriate
			The Navigator drill holes were downhole surveyed using a single shot
			Eastman device to record the hole orientation near the end of the drill hole.
			Some drill holes were also surveyed every 30m.
			The KRE drill holes were not subjected to downhole surveying.
			The collar position of the KRAE and Navigator drill holes were recorded in
			the Australian Map Grid 1984 (AMG84) coordinate system, Zone 52. The KRE
			collar positions were recorded in Map Grid of Australia 1994 (MGA94)
			coordinate system in Zone 52. The locations of the KRAE and Navigator
			collars were transformed to MGA94 coordinates by KRE. H&SC has not
			checked this transformation.
			The topographic surface used in the Mineral Resource estimate was created
			using the drill hole collar positions. The topography of the Cummins Range
			deposit is relatively flat. The topographic surface used is considered to be
			adequate for the reported Inferred Resource.
Data spacing	 Data spacing for reporting of Exploration Results.		Drill holes are on a generally regular grid with a nominal spacing of 50m E-
and	 Whether the data spacing and distribution is sufficient to establish the		W and 40m N-S.
distribution	degree of geological and grade continuity appropriate for the Mineral		The Navigator drill hole samples were collected both as 4m composites for
	Resource and Ore Reserve estimation procedure(s) and		initial assaying and as 1m samples for follow up assaying of anomalous
	classifications applied.		mineralised zones.
	 Whether sample compositing has been applied.		The KRE downhole sampling interval is one metre, samples were not
			physically composited.
			Drill hole spacing of 40 x 50m is appropriate for assessment of geological and
			grade continuity for this type of deposit at the level of an Inferred Resource.
			Maximum drill depth isgenerallyto 300mRL(90m below surface).

Criteria	JORC Code explanation	Commentary	Commentary
Orientation of	 Whether the orientation of sampling achieves unbiased sampling of		The majority of drill holes dip around 60 ° to the south although a few are
data in	possible structures and the extent to which this is known, considering		vertical. The mineralisation is sub-horizontal.
relation to geological	the deposit type.  If the relationship between the drilling orientation and the orientation		Drilling orientations are appropriate.
structure	of key mineralised structures is considered to have introduced a
	sampling bias, this should be assessed and reported if material.
Sample	 The measures taken to ensure sample security.		No documentation was supplied; industry standards are assumed
security
Audits or	 The results of any audits or reviews of sampling techniques and data.		SRK (2011) reviewed the sampling techniques with no adverse findings.
reviews

Section 2 Reporting of Exploration Results

(Criteria listed in the preceding section also apply to this section.)

Criteria	JORC Code explanation	Commentary	Commentary
Mineral	 Type, reference name/number, location and ownership including		The Cummins Range project is located 130km southwest of Halls Creek in
tenement and	agreements or material issues with third parties such as joint		the East Kimberley, Western Australia. Based on information provided by
land tenure	ventures, partnerships, overriding royalties, native title interests,		Navigator Resources Ltd, one Exploration Licence covers the deposit,
status	historical sites, wilderness or national park and environmental		E80/2232, and consists of 15 blocks totalling 48km2on the northern margin
	settings.		of the Great Sandy Desert.
	 The security of the tenure held at the time of reporting along with any known impediments to obtaining a licence to operate in the area.	 	The Exploration Licence is 100% owned by Navigator Resources. The Exploration licence overlies two indigenous‐owned pastoral leases:
			Carranya (PL 3114/1155, 76.5%) and Lamboo (PL 3114/1109, 23.5%).
			The Project area is subject to a Native Title claim (WC99/020) by the
			Lamboo People. A work clearance survey covering the full area of
			E80/2232 was completed in April 2007. No sites of significance were
			identified.
Exploration	 Acknowledgment and appraisal of exploration by other parties.		In 1977 an aeromagnetic survey was flown over the area
done by other			CRAE followed up with ground inspection of a large, discrete magnetic
parties			anomaly and discovered the Cummins Range carbonatite. CRAE held the
			mineral claims, exploration licenses and mining leases from 1979 to 1990.
			Between 1978 and 1984 CRAE conducted a detailed ground magnetic
			survey, several drilling campaigns including auger, Rotary Air Blast and air-
			core drilling. The drilling delineated a zone within the centre of the
			carbonatite, which has a high REE content.
			In 1984, CRAE completed two diamond drill-holes (402.1m and 402.0m) and
			one percussion water bore (54 m) into the central portion of the carbonatite
			complex.
			Navigator was granted the exploration licenses in May 2001.
			In 2002 Navigator flew a detailed aeromagnetic survey over the area.
			In 2007 Navigator conducted an air-core and a RC drilling campaign. Much
			of the air-core drilling targeted satellite anomalies around the Cummins
			Range Carbonatite. The RC campaign targeted an area approximately 400 x
			500m (E x N) in the central zone of the Cummins Range Carbonatite.
			In 2010, CSIRO conducted petrographic, electron microscopic and X-ray
			diffraction studies on a suite of ten samples from Cummins Range and
			commented that existing mineralogical studies carried out by CRAE
			concentrated on mineralogyof unweathered carbonatite.

Criteria	JORC Code explanation	Commentary	Commentary
			In 2011 KRE drilled a total of 77 RC drill holes into the Cummins Range
			Deposit,infillingand extendingthe drillingcarried out byNavigator.
Geology	 Deposit type, geological setting and style of mineralisation.		The Cummins Range REE mineralisation is interpreted to have resulted from
			supergene processes over a primary carbonatite deposit similar to Mt Weld.
			The Cummins Range Carbonatite intrudes a sequence of slate, phyllite and
			meta-greywacke, correlated with those of the Archean Olympio Formation
			of the Halls Creek Group.
			The Cummins Range Carbonatite itself is interpreted to be a composite, sub-
			vertical pipe complex measuring 1.8 km x 1.7 km in plan view. The complex
			is comprised of three generally concentric zones of (1) an outer zone of
			unaltered pyroxenite that constitutes 60% of the complex; (2) an inner zone
			of carbonated mica-rich pyroxenite altered to amphibolite that contains
			numerous steeply dipping carbonatite veins, up to 60 cm thick, and (3) a
			central zone of carbonatite, weathered to silicified ironstone breccia at the
			surface (Andrew 1990).
			Weathering processes including leaching, dissolution, and silicification of the
			carbonatite have led to residual enrichment in the oxide zone by up to ten
			times the original concentration of all the resistate minerals such as
			monazite, apatite, zircon, pyrochlore and magnetite (Andrew, 1990),
			concentrating LREE, niobium, and phosphorus, which forms the mineral
			deposit (Hassan, 2000; Sanders, 1999; Andrew, 1990). Secondary monazite
			accounts for most of the enrichment in LREE (Andrew, 1990).
			Drilling indicates that the mineralisation is up to 50m thick and generally
			forms sub-horizontal zones in the weathered carbonatite complex. A
			northwest-southeast trend to highergrade mineralisation is apparent.
Drill hole	 A summary of all information material to the understanding of the		Exploration results are not being reported
Information	exploration results including a tabulation of the following information
	for all Material drill holes:
	`o` easting and northing of the drill hole collar
	`o` elevation or RL (Reduced Level – elevation above sea level in
	metres) of the drill hole collar
	`o` dip and azimuth of the hole
	`o` down hole length and interception depth
	`o` hole length.
	 If the exclusion of this information is justified on the basis that the
	information is not Material and this exclusion does not detract from
	the understanding of the report, the Competent Person should clearly

Criteria	JORC Code explanation	Commentary	Commentary
	explain why this is the case.
Data	 In reporting Exploration Results, weighting averaging techniques,		Exploration results are not being reported
aggregation	maximum and/or minimum grade truncations (e.g. cutting of high
methods	grades) and cut-off grades are usually Material and should be stated.
	 Where aggregate intercepts incorporate short lengths of high grade
	results and longer lengths of low grade results, the procedure used
	for such aggregation should be stated and some typical examples of
	such aggregations should be shown in detail.
	 The assumptions used for any reporting of metal equivalent values
	should be clearly stated.
Relationship	 These relationships are particularly important in the reporting of		Exploration results are not being reported
between	Exploration Results.		Drilling has generally been vertical or at an angle of around 60° and appears
mineralisation	 If the geometry of the mineralisation with respect to the drill hole		to cut across the sub-horizontal boundaries of mineralisation.
widths and	angle is known, its nature should be reported.
intercept	 If it is not known and only the down hole lengths are reported, there
lengths	should be a clear statement to this effect (e.g. ‘down hole length, true
	_width not known’). _
Diagrams	 Appropriate maps and sections (with scales) and tabulations of		Exploration results are not being reported
	intercepts should be included for any significant discovery being
	reported These should include, but not be limited to a plan view of
	drill hole collar locations and appropriate sectional views.
Balanced	 Where comprehensive reporting of all Exploration Results is not		Exploration results are not being reported
reporting	practicable, representative reporting of both low and high grades
	and/or widths should be practiced to avoid misleading reporting of
	Exploration Results.
Other	 Other exploration data, if meaningful and material, should be reported		Exploration results are not being reported
substantive	including (but not limited to): geological observations; geophysical
exploration	survey results; geochemical survey results; bulk samples – size and
data	method of treatment; metallurgical test results; bulk density,
	groundwater, geotechnical and rock characteristics; potential
	deleterious or contaminating substances.
Further work	 The nature and scale of planned further work (e.g. tests for lateral		Exploration results are not being reported
	extensions or depth extensions or large-scale step-out drilling).
	 Diagrams clearly highlighting the areas of possible extensions,
	including the main geological interpretations and future drilling areas,
	provided this information is not commercially sensitive.

Section 3 Estimation and Reporting of Mineral Resources

(Criteria listed in section 1, and where relevant in section 2, also apply to this section.)

Criteria	JORC Code explanation	Commentary	Commentary
Database	 Measures taken to ensure that data has not been corrupted by, for		Data was provided to H&SC as an Access database by KRE.
integrity	example, transcription or keying errors, between its initial collection		H&SC is not aware of the measures taken by Navigator or KRE to ensure that
	and its use for Mineral Resource estimation purposes.		data has not been corrupted.
	 Data validation procedures used.		Limited validation was conducted by H&SC to ensure that the drill hole
			database is internally consistent. Validation included checking that no
			assays, density measurements or geological logs occur beyond the end of
			hole and that all drilled intervals have been geologically logged. The
			minimum and maximum values of assays and density measurements were
			checked to ensure values are within expected ranges.
			Assessment of the data confirms that it is suitable for resource estimation.
Site visits	 Comment on any site visits undertaken by the Competent Person and		The Competent Person did not visit the deposit due to the preliminary
	the outcome of those visits.		nature of the project.
	 If no site visits have been undertaken indicate why this is the case.		SRK Consulting undertook a site visit on 11 January 2011 (SRK, 2011).
Geological	 Confidence in (or conversely, the uncertainty of) the geological		Outcrop within the project area is limited to a few shallow mounds of
interpretation	interpretation of the mineral deposit.		silicified, ferruginous collapse breccia overlying the core of the Cummins
	 Nature of the data used and of any assumptions made.		Range Carbonatite
	 The effect, if any, of alternative interpretations on Mineral Resource		Drill core indicate that the transition from weathered to fresh rock is sharp.
	estimation.		This boundary was modelled using drill core logs and forms the base of the
	 The use of geology in guiding and controlling Mineral Resource		estimated and reported resources. This is consistent with the geological
	estimation.		model of lateritic enrichment of TREOYs. Alternative interpretations of this
	 The factors affecting continuity both of grade and geology.		surface are possible but are unlikely to significantly change the resource
			estimate.
			Surfaces representing the base of complete oxidation and the base of
			alluvial material were also created from downhole logs. These boundaries
			were only used for reporting the estimates and did not play a role in the
			estimation.
			A 3D solid wireframe encompassing zones over 0.3% TREOY was created
			based on assay data. These zones mostly form coherent sub-horizontal
			layered and bifurcating domains. Alternative interpretations of this volume
			are possible but are unlikely to significantly change the resource estimate
			due to the relatively large difference between the cut-off grade at which the
			resources are reported and the TREOY grade used to delineate the
			mineralised zones.

Criteria	JORC Code explanation	Commentary	Commentary
			It is assumed that the drill hole database, including collar locations,
			downhole surveys, geological logs and assay data is correct.
			The continuity is controlled by both weathering history and the host
			carbonatite.
			The interpreted mineralisation shapes that form the basis of the resource
			volume are considered to be over-domained resulting in some unrealistically
			narrow and unlikely continuous zones. These are likely to explain the small
			increase in tonnage arising from the 2012 estimates compared to earlier
			estimates byP L Hellman. This is,however,unlikelyto be material.
Dimensions	 The extent and variability of the Mineral Resource expressed as		The majority of estimated resources at a cut-off of 2.5% TREOY form a
	length (along strike or otherwise), plan width, and depth below		reasonably coherent zone with a strike length of around 480m in a NE
	surface to the upper and lower limits of the Mineral Resource.		direction that is up to 200 m wide. Two, much smaller, additional volumes
			of resources are located around 180m to the NW. The upper limit of the
			mineralisation occurs at surface and the reported resources reach a
			maximum depth of 76m below surface.
Estimation	 The nature and appropriateness of the estimation technique(s)		The TREO+Y2O3, TLREO, THREO, U3O8, ThO2 and P2O5 concentrations were
and modelling	applied and key assumptions, including treatment of extreme grade		estimated using Ordinary Kriging using the geostatistical package GS3. Post-
techniques	values, domaining, interpolation parameters and maximum distance		processing, model validation and resource reporting was carried out using
	of extrapolation from data points. If a computer assisted estimation		the Mining Software package Micromine. H&SC considers Ordinary Kriging
	method was chosen include a description of computer software and parameters used.  The availability of check estimates, previous estimates and/or mine production records and whether the Mineral Resource estimate takes appropriate account of such data.  The assumptions made regarding recovery of by-products.  Estimation of deleterious elements or other non-grade variables of economic significance (e.g. sulphur for acid mine drainage characterisation).  In the case of block model interpolation, the block size in relation to the average sample spacing and the search employed.	  	to be an appropriate estimation technique for this type of mineralisation. The mineralised domains, defined by the 3D solid wireframe encompassing zones over approximately 0.3% TREOY, were used to restrict the estimation. Only blocks inside the mineralised wireframes were estimated using only samples from within the mineralised wireframes. A surface representing the top of fresh rock of partial weathering was used to restrict the base of the estimation as weathering is interpreted to have enriched the TREOY concentrations. The relatively low CV and absence of extreme values precluded the need for top-cutting of any of the estimated concentrations.
	 Any assumptions behind modelling of selective mining units.		Variography was performed on all TREO+Y2O3, TLREO, THREO, U3O8, ThO2
	 Any assumptions about correlation between variables.		and P2O5 composite data.
	 Description of how the geological interpretation was used to control		Drill holes are on a broadly regular grid with a nominal spacing of 50m E-W
	the resource estimates.		and 40m N-S. Block dimensions are 10x12.5x2.5m (E, N, RL respectively). The
	 Discussion of basis for using or not using grade cutting or capping.		plan dimensions were chosen as they are nominally a quarter of the drill hole
	 The process of validation, the checking process used, the comparison		spacing. The vertical dimension was shortened to reflect downhole data
	of model data to drill hole data, and use of reconciliation data if		spacing and flat-lying nature of the mineralisation. Discretisation was set to
			5x5x2(E,N,RL respectively).

Criteria	JORC Code explanation	Commentary	Commentary
	available.		Three search passes were employed with progressively larger radii or
			decreasing search criteria. The first pass used radii of 45x55x8m whereas the
			second and third used 90x110x16m (azimuths 024, 254, and vertical
			respectively). All three passes used an eight octant search and a maximum
			of 32 composites. Passes one and two required a minimum of 16 composites
			with data required from at least four of the eight octants. Pass three
			required a minimum of eight composites from at least two of the eight
			search octants.
			The maximum extrapolation of estimates is 110m.
			No check estimates have been conducted though a previous Inferred
			Estimate by Dr Phillip Hellman in September, 2009 (Hellman, 2009) was
			reported to be 4.17Mt at 1.72% TREOY at a cut-off of 1% TREOY. This agrees
			well with the current estimates of 4.90Mt at 1.74% TREOY at the same lower
			cut-off. The methodology used in the two estimates is similar and
			differences are due to additional KRE drilling and slightly modified
			interpretation of the mineralised wireframes.
			No production has taken place so no reconciliation data is available.
			No assumptions were made regarding the recovery of by-products.
			Estimated uranium and phosphate concentrations are elevated and may
			have the potential to be recovered as by-products of REO processing.
			The concentration of thorium was estimated as this can be considered to be
			a deleterious element in rare earth deposits. The estimated concentrations
			are low at grades above cut-offs of interest.
			TREOY, ThO2, U3O8and P2O5were estimated independently.
			The final H&SC block model was reviewed visually by H&SC and it was
			concluded that the block model fairly represents the grades observed in the
			drill holes. H&SC also validated the block model statistically using a variety
			ofplots and summarystatistics.
Moisture	 Whether the tonnages are estimated on a dry basis or with natural		Tonnages are estimated on a dry weight basis; moisture has not been
	moisture, and the method of determination of the moisture content.		determined.
Cut-off	 The basis of the adopted cut-off grade(s) or quality parameters		2.5% TREOY cut-off grade used for reporting resources is the same as the
parameters	applied.		comparable light rare monazite-hosted earth deposit at Mt Weld.
			A lower cut-off grade of 1.0% has been used previously (KRE, 2011) based
			on KRE’s internal research. This cut-off grade is now considered too low
			given the 4% cut-offs used for Ore Reserve reporting by Lynas and the 5%
			used by Molycorp for the Mountain Pass operation.

Criteria	JORC Code explanation	Commentary	Commentary
Mining factors	 Assumptions made regarding possible mining methods, minimum		The flat-lying, shallow nature of the mineralisation makes it amenable to
or	mining dimensions and internal (or, if applicable, external) mining		open-pitting.
assumptions	dilution. It is always necessary as part of the process of determining		The model parent block size is 10x12.5x2m (E x N x RL). The model has been
	reasonable prospects for eventual economic extraction to consider potential mining methods, but the assumptions made regarding mining methods and parameters when estimating Mineral Resources may not always be rigorous. Where this is the case, this should be reported with an explanation of the basis of the mining assumptions made.		sub-blocked along the edges of the mineralised wireframes. Any internal dilution has been factored in with the modelling and as such is appropriate to the block size. The block size is larger than that achievable in a selective mining operation though it is not considered that this will significantly affect grades achieved in a mining operation.
			Additional work is needed to test the possibility of generating additional
			revenue from producing uranium and phosphorous as by-products of
			TREOY processing.
Metallurgical	 The basis for assumptions or predictions regarding metallurgical		Monazite and apatite are the main rare earth minerals as determined by
factors or	amenability. It is always necessary as part of the process of		CSIRO in 10 samples from the higher grade zone (Navigator, 2010)
assumptions	determining reasonable prospects for eventual economic extraction to		A high grade metallurgical composite with 3.43% REO was collected from
	consider potential metallurgical methods, but the assumptions regarding metallurgical treatment processes and parameters made when reporting Mineral Resources may not always be rigorous. Where this is the case, this should be reported with an explanation of the basis of the metallurgical assumptions made.	 	core drilled in 2011 (KRE, 2012) A 600 kg portion was subjected to concentration and mineralogical studies at a Chinese research institute (KRE, 2012) with a second 50kg sample sent for testing to the Ian Wark Research Institute in Adelaide (KRE, 2012) Preliminary results, not optimised, based on flotation and Wet High
			Intensity Magnetic Separation (“WHIMS”) achieved a 4.8 times upgrade
			from 3.55% TREO to a concentrate with 17% TREO, representing a recovery
			of 50% of the feed TREO.
			The sample, however, represents a resource grade above a 2.5% TREO cut-
			off which is not representative of the resource grade above a 1.0% cut-off
			grade quoted by KRE. The head grade used for metallurgical testing
			represents a resource grade above an approximate 2.5% TREO grade.
			Approximately 14% of the total resource based on a cut-off grade of 1.0% is
			above a 2.5% TREO cut-off.
			No other metallurgical testing results have been supplied to H&SC and it is
			not known whether any were reported after April 2012.
Environmenta	 Assumptions made regarding possible waste and process residue		It is not known whether any special treatment will be required for the
l factors or	disposal options. It is always necessary as part of the process of		storage of waste and process residue material.
assumptions	determining reasonable prospects for eventual economic extraction to		Thorium concentrations are low and Th/%TREOY ratios range from 14 to 24
	consider the potential environmental impacts of the mining and processing operation. While at this stage the determination of potential environmental impacts, particularly for a greenfields project,		above cut-off grades from 1.0 to 5.0%. Additional work is required to investigate the possible recovery of uranium as a by-product orprocessingTREOY ore. Uranium concentrations in the

Criteria	JORC Code explanation	Commentary	Commentary
	may not always be well advanced, the status of early consideration of		deposit may produce environmental hazards and storage problems if not
	these potential environmental impacts should be reported. Where		adequately tested and understood.
	these aspects have not been considered this should be reported with		The environmental issues associated with this resource are basically
	an explanation of the environmental assumptions made.		unknown.
Bulk density	 Whether assumed or determined. If assumed, the basis for the		The density data provided to H&SC consisted of ten downhole gamma
	assumptions. If determined, the method used, whether wet or dry, the		geophysical logs. The drill hole database shows that the downhole probe
	frequency of the measurements, the nature, size and		was operated by Surtron, a specialist wireline service provider. H&SC are
	representativeness of the samples.		not aware of the details regarding how this test work was operated or
	 The bulk density for bulk material must have been measured by		which type of downhole probe was used.
	methods that adequately account for void spaces (vughs, porosity, etc.), moisture and differences between rock and alteration zones within the deposit.  Discuss assumptions for bulk density estimates used in the evaluation process of the different materials.	  	The gamma readings appear to have been taken every ten centimetres. H&SC consider that the range of density values provided is a reasonable representation of the in-situ dry bulk density. The ten drill holes from which the density data are sourced are all located in the north-eastern quadrant of the drill data.
			H&SC produced average density values for the alluvial (1.52t/m3),
			weathered (2.15t/m3) and transitional (2.32t/m3) zones using data located
			within the appropriate domain.
			These average densities were assigned to blocks in the corresponding
			domain.
			More density test work is required in order to raise the confidence of the
			resource estimate.
Classification	 The basis for the classification of the Mineral Resources into varying		The entire Mineral Resource is classified as Inferred.
	confidence categories.		This classification takes into account all relevant factors including relative
	 Whether appropriate account has been taken of all relevant factors		confidence in tonnage/grade estimations, reliability of input data,
	(i.e. relative confidence in tonnage/grade estimations, reliability of		confidence in continuity of geology and metal values, quality, quantity and
	input data, confidence in continuity of geology and metal values,		distribution of the data
	quality, quantity and distribution of the data).  Whether the result appropriately reflects the Competent Person’s view of the deposit.	 	The classification appropriately reflects the Competent Person’s view of the deposit. Cummins Range ranks 20thout 58 rare earth deposits in a H&SC database
			consisting of worldwide rare earth deposits in terms of grade based on a 1%
			cut-off and 55thon the basis of contained metal using a more realistic cut-
			off of 2.5%.
Audits or	 The results of any audits or reviews of Mineral Resource estimates.		The Mineral Resources of the Cummins Range deposit were estimated in
reviews			2009 by P L Hellman (Hellman, 2009). SRK Consulting conducted an
			Independent Technical Assessment Report for KRE in March 2011. SRK

Criteria	JORC Code explanation	Commentary
		(2011) states that “the Mineral Resource estimate is suitable for the nature
		and style of the mineralisation and the available data”. These resources are
		consistent with the updated 2012 Mineral Resource estimates later
		reported by KRE (2012).
Discussion of	 Where appropriate a statement of the relative accuracy and	 The relative accuracy and confidence level in the Inferred Mineral Resource
relative	confidence level in the Mineral Resource estimate using an approach	estimates presented here are considered to be in line with the generally
accuracy/	or procedure deemed appropriate by the Competent Person. For	accepted accuracy and confidence of Inferred Mineral Resources of similar
confidence	example, the application of statistical or geostatistical procedures to	types of deposits and data quality. This has been determined on a
	quantify the relative accuracy of the resource within stated confidence limits, or, if such an approach is not deemed appropriate, a qualitative discussion of the factors that could affect the relative accuracy and confidence of the estimate.  The statement should specify whether it relates to global or local estimates, and, if local, state the relevant tonnages, which should be relevant to technical and economic evaluation. Documentation should	qualitative, rather than quantitative, basis, and is based on the Competent Person’s experience with similar data and mineralisation.  Previous work by H&SC was confined to resource estimation with KRE taking responsibility for drilling, sampling, data quality, QAQC, geological/structural interpretation and choice of cut-off grade.  The geological nature of the deposit, composite/block grade comparison
	include assumptions made and the procedures used.  These statements of relative accuracy and confidence of the estimate	and the low coefficients of variation lend themselves to reasonable level of confidence in the resource estimates.
	should be compared with production data, where available.	 The amount, clustering and reliability of the density test work requires
		attention.
		 Certified reference materials (“CRM’s”) have been submitted for the KRE
		phase of drilling. The results demonstrate acceptable accuracy. No external
		check assays appear to have been completed for any of the phases of
		drilling. Twinning of RC and air-core holes by approximately 3-5 diamond
		holes is required to demonstrate confidence in the RC drilling.
		 The Mineral Resource estimates are considered to be accurate globally, but
		there is some uncertainty in the local estimates due to the current drill-hole
		spacing and a lack of geological definition.
		 The estimates are local, in the sense that they are localised to model blocks
		of a size considered appropriate for local grade estimation.
		 No mining of the deposit has taken place so no production data is available
		for comparison.

References

Andrew, RL, 1990: Cummins Range carbonatite, in Geology of the Mineral Deposits of Australia and Papua New Guinea , (Ed. FE Hughes), pp.711-713 (The Australian Institute of Mining and Metallurgy: Melbourne).

Hassan, LY, 2000: Mineral Occurrences and exploration potential of the east Kimberley: Western Australia Geological Survey, Report 74, 83p.

Hellman, PL, 2009: Cummins Range Resource Estimation, Hellman & Schofield Pty Ltd

Kimberley Rare Earths Ltd, 2012: Cummins Range Update. ASX Announcement, 13 February, 2012.

Kimberley Rare Earths Ltd, 2012: Cummins Range: Concentrator flow sheet established. ASX Announcement, 23 April, 2012.

Navigator Resources Limited, 2010: Valuation report for Cummins Range. ASX Release, 25 October4, 2010

Sanders, TS, 1999: Mineralization of the Halls Creek Orogen, east Kimberley region, Western Australia: Western Australia Geological Survey, Report 66, 44p.

SRK, 2011: NAV001 Independent Technical Assessment Report for Kimberley rare Earths Limited. March 2011.

Weir, DJ, 1989: Review of the Cummins Range Carbonatite, ML80/266, Mt Bannerman, SE52-13, CRA Exploration Pty. Limited, Unpublished. WAMEX A#29963.

Consent

The information in this report that relates to Exploration Targets, Exploration Results or Mineral Resources is based on information compiled by Dr Phillip L Hellman, a Competent Person who is a Fellow of the Australian Institute of Geoscientists. Dr Hellman is a consultant with H&S Consultants Pty Ltd and he has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’.

Dr P L Hellman consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

26 November 2015

Use)of)Funds)

If! the! full! amount! of! $2,000,250 is! raised! from! the! Capital! Raising! (assuming! the! Second! Placement!is!fully!subscribed),!the!Company!intends!to!apply!the!funds!raised!as!follows:!

Table)3)–)Proposed)use)of)funds)

Proposeduseoffunds	Year1	Year2	Total
Reviewanddevelopmentofexistingbusiness	$200,000	$250,000	$450,000
Reviewofnewprojects	$150,000	$175,000	$325,000
Totalgeneralworkingcapitalbudget	$350,000	$425,000	$775,000
PaymenttotheCreditorsTrust(a)	$615,000	Nil	$615,000
Workingcapital(b)	$335,000	$275,250	$610,250
Total	$1,300,000	$700,250	$2,000,250

Notes:)

(a)!The!Company!will!use!proceeds!from!the!capital!raising!to!pay!the!Cash!Consideration!of!$615,000!to!satisfy! obligations!under!the!DOCA!

(b)! This!includes!expenses!associated!with!the!recapitalisation!proposal!to!be!repaid!to!the!Syndicate

5.) Reinstatement)to)Official)quotation)of)the)ASX)

As!already!mentioned,!subject!to!all!the!Resolutions!(apart!from!Resolutions!13U15!(inclusive))! being! passed! at! this! Extraordinary! General! Meeting,! the! Company! intends! to! seek! reinstatement!to!Official!Quotation!on!ASX.!The!Company!will!therefore!need!to!satisfy!ASX’s! requirements!prior!to!reinstatement.!ASX!has!confirmed,!however,!that!the!Company!will!not! be!required!to!reUcomply!with!Chapters!1!and!2!of!the!ASX!Listing!Rules!in!their!entirety.!

Under!ASX!Listing!Rule!17.7,!the!ASX!has!the!discretion!to!reinstate!the!Securities!of!the! Company! to! trading.! ASX! can! exercise! its! discretion! if! it! is! satisfied! that! the! Company! is! capable!of!meeting!the!ongoing!requirements!for!listing,!including!that:!

(a)! there! is! sufficient! level! of! operations! to! warrant! the! continued! quotation! of! its! securities]!
(b)! there!is!sufficient!level!of!shareholder!spread]!
(c)! its! financial! condition! is! adequate! to! warrant! the! continued! quotation! of! its! securities]!
(d)! the!New!Board!(in!the!event!that!the!proposed!Directors!of!the!New!Board!are! elected!under!this!Notice!of!Meeting)!completes!all!outstanding!reports!required! by!the!ASX!Listing!Rules!(including!without!limitation,!its!audited!financial!report! for!the!last!year!end)]!and!
(e)! it!pays!all!outstanding!fees!to!the!ASX.!

Full!details!of!the!business!to!be!considered!at!the!Extraordinary!General!Meeting!are!set!out! below.

RESOLUTION)1–)ISSUE)OF)SECURITIES)PURSUANT)TO)THE)FIRST)PLACEMENT))

General

Resolution!1!seeks!Shareholder!approval!for!the!issue!and!allotment!of!the!following:!

(a)! up!to!200,000,000!fully!paid!ordinary!shares!to!Auxano!(or!its!nominees)!as!part!of!the! Proposal!( First)Placement)A)Shares )!at!an!issue!price!of!$0.0025!per!First!Placement! A!Share!to!raise!up!to!$500,000]and!
(b)! up!to!25,000,000!fully!paid!ordinary!shares!to!Otsana!(or!its!nominees)!as!part!of!the! Proposal! ( First) Placement) B) Shares )! at! an! issue! price! of! $0.00001! per! First! Placement!B!Share!to!raise!up!to!$250.!
(c)! Up!to!150,000,000!Options!to!each!subscribe!for!one!(1)!Share!in!the!Company!to! Auxano!(or!its!nominees)!and!other!investors!that!are!invited!by!the!Company!as!part! of! the! Proposal! ( First) Placement) Options )! for! nil! consideration,! with! each! First! Placement!Option!exercisable!at!$0.01!expiring!3!years!after!the!date!of!issue.!!
(d)! up! to! 25,000,000! Options! to! each! subscribe! for! one! (1)! Share! in! the! Company! to! Otsana!(or!its!nominees)!and!other!investors!that!are!invited!by!the!Company!as!part! of! the! Proposal! ( First) Placement) Options )! for! nil! consideration,! with! each! First! Placement!Option!exercisable!at!$0.01!expiring!3!years!after!the!date!of!issue.!!

ASX!Listing!Rule!7.1!provides!that!a!company!must!not,!subject!to!specified!exceptions,!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!securities!in!the!same!class!on!issue!at!the!commencement!of!that!12! month!period.!

The!effect!of!Resolution!1!will!be!to!allow!the!Company!to!issue!the!Securities!pursuant!to!the! First!Placement!during!the!period!of!3!months!after!the!Extraordinary!General!Meeting!(or!a! longer! period,! if! allowed! by! ASX),! without! using! the! Company’s! 15%! annual! placement! capacity.!

Information)required)by)ASX)Listing)Rule)7.1

Pursuant!to!and!in!accordance!with!ASX!Listing!Rule!7.3,!the!following!information!is!provided! in!relation!to!the!First!Placement:!

(a)! Maximum!of!225,000,000!First!Placement!Shares!and!175,000,000!First!Placement! Options!are!to!be!issued.!
(b)! Apart! from! those! First! Placement! Securities! issued! to! Related! Parties! (or! their! nominees),!the!First!Placement!Securities!will!be!issued!no!later!than!3!months!after! the! date! of! the! Extraordinary! General! Meeting! (or! such! later! date! to! the! extent! permitted! by! any! ASX! waiver! or! modification! of! the! ASX! Listing! Rules)! and! it! is! intended!that!allotment!will!occur!on!the!same!date.!
(c)! Where! the! First! Placement! Securities! are! being! issued! to! related! parties! or! their! nominees,!these!securities!will!be!issued!within!one!month!of!the!date!of!the!meeting! (or!such!later!date!to!the!extent!permitted!by!any!ASX!waiver!or!modification!of!the! ASX!Listing!Rules)!and!it!is!intended!that!allotment!will!occur!on!the!same!date.!!

(d)! The!issue!price!of!the!First!Placement!A!Shares!will!be!$0.0025!per!First!Placement!A! Share.!
(e)! The!issue!price!of!the!First!Placement!B!Shares!will!be!$0.00001!per!First!Placement! B!Share.!
(f)! The!First!Placement!Options!will!be!issued!for!nil!consideration.!!
(g)! The!allottees!of!First!Placement!Securities!are!members!of!the!Syndicate!(that!includes! Related!Parties)!(or!their!nominees).!!
(h)! The!First!Placement!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!terms!and!conditions!of!the!First!Placement!Options!are!set!out!in! Annexure!C.!
(i)! The!Company!intends!to!use!the!funds!raised!from!the!First!Placement!in!accordance! with!the!plan!outlined!in!Table!3.!Should!the!First!Placement!Options!be!exercised!the! Company!intends!to!use!the!funds!raised!as!general!working!capital.!

RESOLUTION)2)–)ISSUE)OF)SECOND)PLACEMENT)SHARES))

General)

Resolution!2!seeks!Shareholder!approval!for!the!issue!and!allotment!of!up!to!150,000,000! fully!paid!ordinary!shares!to!general!investors!(that!may!include!members!of!the!Syndicate!(or! its!nominees))!( Second)Placement)Shares )!at!an!issue!price!of!$0.01!per!Share!to!raise!up! to!$1,500,000.!

Other!than!the!Related!Parties,!whose!participation!in!the!Second!Share!Placement!(either! directly!or!indirectly!through!their!nominees)!must!be!approved!pursuant!to!Resolutions!4!to!8! inclusive,!none!of!the!remaining!subscribers!pursuant!to!this!issue!will!be!related!parties!of! the!Company.!

The!effect!of!Resolution!2!will!be!to!allow!the!Company!to!issue!the!Shares!pursuant!to!the! Second!Placement!during!the!period!of!3!months!after!the!Extraordinary!General!Meeting!(or! a! longer! period,! if! allowed! by! ASX),! without! using! the! Company’s! 15%! annual! placement! capacity.

Information)required)by)ASX)Listing)Rule)7.1

Pursuant!to!and!in!accordance!with!ASX!Listing!Rule!7.3,!the!following!information!is!provided! in!relation!to!the!Second!Placement:!

(a)! Maximum!of!150,000,000!Second!Placement!Shares!are!to!be!issued.!
(b)! Apart! from! those! Second! Placement! Shares! issued! to! Related! Parties! (or! their! nominees),!the!Second!Placement!Shares!will!be!issued!no!later!than!3!months!after! the! date! of! the! Extraordinary! General! Meeting! (or! such! later! date! to! the! extent! permitted! by! any! ASX! waiver! or! modification! of! the! ASX! Listing! Rules)! and! it! is! intended!that!allotment!will!occur!on!the!same!date.!
(c)! Where! the! First! Placement! Securities! are! being! issued! to! related! parties! or! their! nominees,!these!securities!will!be!issued!within!one!month!of!the!date!of!the!meeting! (or!such!later!date!to!the!extent!permitted!by!any!ASX!waiver!or!modification!of!the! ASX!Listing!Rules)!and!it!is!intended!that!allotment!will!occur!on!the!same!date.!!
(d)! The!issue!price!will!be!$0.01!per!Second!Placement!Share.!
(e)! The!allottees!are!investors,!some!of!which!are!members!of!the!Syndicate!(that!includes! Related! Parties)! (or! their! nominees)! of! the! Company! and! invited! to! invest! by! the! Company.!
(f)! The!Second!Placement!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.!

The! Company! intends! to! use! the! funds! raised! from! the! Second! Share! Placement! in! accordance!with!the!plan!as!outlined!in!Table!3.!

RESOLUTION) 3) –) APPROVAL) OF) FUTURE) ISSUE) OF) 50,000,000) MANAGEMENT) OPTIONS))

Under!this!Resolution,!the!Company!seeks!approval!for!the!issue!of!50,000,000!Management! Options!to!the!proposed!Directors!of!the!Company,!key!management!and!advisers!of!the! Company!for!nil!consideration!at!an!exercise!price!of!$0.02!per!Management!Option,!expiring! 4!years!from!the!date!of!issue.!

The!number!of!Management!Options!that!will!be!issued!to!each!Management!Optionholder! (or!their!nominee)!is!depicted!in!the!table!below.!

Table)4)–)Complete)List)of)Management)Options)Recipients)

IntendedRecipients	ProposedRole	Related Party?	Management Options
GlenDobbie	ManagingDirector	Yes	13,942,856
MalcolmKeefe	NonUExecutiveDirector	Yes	5,714,286
GregRuddock	NonUExecutiveChairman	Yes	3,333,333
JoshuaMcKean	NonUExecutiveDirector	Yes	3,333,333
RemainingmembersoftheSyndicate	N/A	No	23,676,192
Total			50,000,000

As! outlined! in! Table! 4,! some! of! the! intended! recipients! of! the! Management! Options! are! Related! Parties! of! the! Company.! For! these! Related! Parties,! further! related! party! specific! Shareholder! approval! are! being! sought! for! Messrs! Dobbie,! Keefe,! Ruddock! and! McKean! under!Resolutions!5!–!8!inclusive!respectively!in!this!Notice!of!Meeting.!Summaries!of!the! backgrounds!for!these!Related!Parties!are!outlined!in!Resolutions!9!–!12!inclusive!in!this! Notice!of!Meeting.!ASX!Listing!Rule!7.1!provides!that!a!company!must!not,!subject!to!specified! exceptions,!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! securities! in! the! same! class! on! issue! at! the! commencement!of!that!12!month!period.!

The!effect!of!Resolution!3!will!be!to!allow!the!Company!to!issue!the!Shares!pursuant!to!the! Second!Placement!during!the!period!of!3!months!after!the!Extraordinary!General!Meeting!(or! a! longer! period,! if! allowed! by! ASX),! without! using! the! Company’s! 15%! annual! placement! capacity.

Information)Required)by)ASX)Listing)Rule)7.3))

The!following!information!in!relation!to!the!Management!Options!is!provided!to!Shareholders! for!the!purposes!of!ASX!Listing!Rule!7.3:!

(a)! In! total,! the! maximum! number! of! Management! Options! to! be! issued! under! this! Resolution!is!50,000,000,!exercisable!at!a!price!of!$0.02!expiring!4!years!from!the!date! of!issue.!!
(b)! Management!Options!to!be!issued!to!nonUrelated!parties!will!be!issued!within!three! months!from!the!date!of!the!Meeting.!Management!Options!to!be!issued!to!the!Related! Parties!will!be!issued!within!one!month!from!the!date!of!the!Meeting.!

(c)! The! allottees! are! proposed! Directors! of! the! Company! (or! their! nominees).! Further! related! party! specific! Shareholder! approval! are! being! sought! for! Messrs! Dobbie,! Keefe,!Ruddock!and!McKean!under!Resolutions!5!–!8!inclusive!respectively!in!this! Notice!of!Meeting.!
(d)! No! consideration! is! payable! for! the! Management! Options! being! issued! under! this! Resolution.!
(e)! The!full!terms!of!the!Management!Options!are!set!out!in!Annexure!D.!

RESOLUTION)4)–)ACQUISITION)OF)A)RELEVANT)INTEREST)

Syndicate

As!set!out!in!the!Letter!to!Shareholders,!the!Creditors!of!the!Company!together!with!the!Deed! Administrator!have!agreed!to!the!Proposal!to!progress!the!restructure!and!recapitalisation!of! the!Company!presented!by!the!Syndicate.!!

The!Syndicate,!consists!of!the!proposed!Directors!and!others!who!are!unrelated!parties!of!the! Company.!Further!details!of!members!of!the!Syndicate!who!will!form!part!of!the!New!Board! are!set!out!in!Table!4.!!

The!relevant!interest!in!the!Company!to!be!acquired!by!the!Syndicate!(or!their!nominees)!in! the!First!Placement!Securities,!Second!Placement!Shares!and!Management!Options!are!the! subject!of!this!Resolution.!!

The!individual!interests!to!be!acquired!by!each!of!the!proposed!Directors,!being!the!Related! Parties!are!the!subject!of!Resolutions!5!–!8!inclusive!in!this!Notice!of!Meeting.!

Information)Required)pursuant)to)Chapter)6)of)the)Corporations)Act)

Section!606(1)!of!the!Corporations!Act!states!that!a!person!must!not!acquire!a!relevant!interest! in!the!issued!voting!shares!in!a!listed!company!if!the!person!acquiring!the!interest!does!so! through!a!transaction!in!relation!to!securities!entered!into!by!or!on!behalf!of!the!person!and! because!of!the!transaction,!that!person’s!or!someone!else’s!voting!power!in!the!Company! increases:!

(a)! from!20%!or!below!to!more!than!20%]!or!
(b)! from!a!starting!point!that!is!above!20%!and!below!90%!

The!voting!power!of!a!person!in!a!body!corporate!is!determined!in!accordance!with!section! 610!of!the!Corporations!Act.!The!calculation!of!a!person’s!voting!power!in!a!Company!involves! determining!the!voting!shares!in!the!Company!in!which!the!person!and!the!person’s!associates! have!a!relevant!interest.!

A!person!( Second)Person )!will!be!an!‘associate’!of!the!other!person!( First)Person )!if!one!or! more!of!the!following!paragraph!applies:!

(a)! the!First!Person!is!a!body!corporate!and!the!Second!Person!is:!
(i)! a!body!corporate!the!First!Person!controls]!
(ii)! a!body!corporate!that!controls!the!First!Person]!or!
(iii)! a!body!corporate!that!is!controlled!by!an!entity!that!controls!the!First!Person]!
(b)! the!Second!Person!has!entered!or!proposes!to!enter!into!a!relevant!agreement!with! the!First!Person!for!the!purpose!of!controlling!or!influencing!the!composition!of!the! Company’s!board!or!the!conduct!of!the!Company’s!affairs]!
(c)! the!Second!Person!is!a!person!with!whom!the!First!Person!is!acting!or!proposed!to! act,!in!concert!in!relation!to!the!Company’s!affairs.!

A!person!has!a!relevant!interest!in!securities!if!they:!

(a)! are!the!holder!of!the!securities]!
(b)! have!the!power!to!exercise,!or!control!the!exercise!of,!a!right!to!vote!attached!to!the! securities]!or!
(c)! have! power! to! dispose! of,! or! control! the! exercise! of! a! power! to! dispose! of,! the! securities.!

It!does!not!matter!how!remote!the!relevant!interest!is!or!how!it!arises.!If!two!or!more!people! can!jointly!exercise!one!of!these!powers,!each!of!them!is!taken!to!have!that!power.!

Item!7!of!section!611!of!the!Corporations!Act!provides!an!exception!to!the!prohibition,!whereby! a!person!may!make!an!otherwise!prohibited!acquisition!of!a!relevant!interest!in!a!company’s! voting!shares!with!Shareholder!approval.!

The! following! information! is! required! to! be! provided! to! shareholders! pursuant! to! the! Corporations!Act!and!ASIC!Regulatory!Guide!74!in!respect!of!obtaining!Shareholder!approval! under! the! exception! for! the! passing! of! this! Resolution.! Shareholders! are! also! referred! to! Independent!Expert’s!Report!( IER )!contained!in!Annexure!A!of!this!Notice!of!Meeting.!

Why!is!approval!under!the!exception!in!item!7!of!section!611!of!the!Corporations!Act!needed?

Shareholder!approval!under!item!7!of!section!611!of!the!Corporations!Act!is!required!because! the! Syndicate! (or! their! nominees)! are! arguably! acting! in! concert! in! relation! to! the! First! Placement!and!the!Second!Placement.!

Following!completion!of!the!First!Placement!and!the!Second!Placement,!the!Syndicate!(or! their!nominees)!will!no!longer!be!acting!in!concert.!However,!for!present!purposes,!given!that! the! nature! of! the! Proposal,! it! is! arguable! that! the! interests! of! the! Syndicate! should! be! aggregated,! thus! triggering! Chapter! 6! of! the! Corporations! Act.! Accordingly,! the! relevant! interest! of! the! Syndicate! in! the! Company! after! implementation! of! all! Resolutions! (when! aggregated)!will!exceed!20%!of!the!issued!capital!of!the!Company.!!

Relevant!interests,!voting!power!and!proposed!capital!structure!of!the!Company!

Annexure!B!outlines!the!dilutive!effect!and!the!maximum!Securities!that!the!Syndicate!(or!their! nominees)!will!be!entitled!to,!and!the!following!Table!5!outlines!the!voting!power!of!members! of!the!Syndicate!(or!their!nominees)!after!implementation!of!all!Resolutions!under!this!Notice! of!Meeting.!

Table)5)–)Proposed)Voting)Power)of)the)Syndicate)

Syndicate	Existing Holding	Max.First Placement Shares	Max.First Placement Options	Max. Second Placement Shares	Management Options	Max.Total Holding (Fully diluted)	Max. Voting Power (a)
GlenDobbie	Nil	45,000,000	36,600,000	11,250,000	13,942,856	106,792,856	17.27%
MalcolmKeefe	Nil	20,000,000	15,000,000	5,000,000	5,714,286	45,714,286	7.39%
GregRuddock	Nil	20,000,000	15,000,000	5,000,000	3,333,333	43,333,333	7.01%
JoshuaMcKean	Nil	20,000,000	15,000,000	5,000,000	3,333,333	43,333,333	7.01%
Remaining membersofthe Syndicate (unrelatedparties)	Nil	120,000,000	93,400,000	23,750,000	23,676,192	260,826,192	42.19%
TOTAL		225,000,000	175,000,000	50,000,000	50,000,000	500,000,000	80.88%

Notes:)

(a) The!maximum!voting!power!is!calculated!by!dividing!the!total!maximum!shareholdings!by!the!total!Shares!issued! (fully!diluted),!consisting!of!18,223,695!(Existing!Shares)!+!225,000,000!(First!Placement!Shares)!+!175,000,000! (First!Placement!Options)!+!150,000,000!(Second!Placement!Shares!–!assumes!that!the!Second!Placement!is! fully!subscribed)!+!50,000,000!(Management!Options)!=!618,223,695.!

The!maximum!relevant!interest!the!Syndicate!will!hold!after!implementation!of!all!Resolutions! except!the!exercise!of!the!First!Placement!Options!and!Management!Options!which!may!or! may!not!be!exercised!in!the!future,!is!69.94%.!

The!maximum!voting!power!of!the!Syndicate!will!hold!after!implementation!of!all!Resolutions! (assuming! that! all! First! Placement! Options! and! Management! Options! are! vested! and! exercised)!on!a!fully!diluted!basis!is!80.88%.!

The!maximum!voting!power!that!the!proposed!Directors!will!hold!after!implementation!of!all! Resolutions!(assuming!that!all!First!Placement!Options!and!Management!Options!are!vested! and!exercised),!on!a!fully!diluted!basis!is!38.69%.!This!represents!an!increase!from!0%!to! 38.69%.!

Summary! of! the! background! of! the! proposed! Directors! are! set! out! in! the! Explanatory! Statement!of!Resolutions!9!–!12!inclusive!under!this!Notice!of!Meeting.!

Intentions!of!the!Syndicate!(or!their!nominees)!

The! Company! understands! that,! in! the! event! that! all! the! Resolutions! under! this! Notice! of! Meeting!are!passed!by!Shareholders,!it!is!the!Syndicate’s!intention!to:!

(a)! Continue!exploration!of!the!existing!Cummins!Range!Project!with!a!view!to!achieving! a!conversion!from!Inferred!to!an!Indicated!classification.!
(b)! Not!either!transfer!any!property!between!the!Company!and!any!person!associated!with! it,!or!change!the!Company’s!existing!policies!in!relation!to!financial!matters.!

Whilst!the!Company’s!current!operations!are!developed,!it!will!continue!to!seek!greater!scale! as!a!Company!through!business!acquisition!opportunities!both!within!and!outside!of!the!mining! sector.!

The!Syndicate’s!review!and!development!plans!are!the!best!estimates!for!the!Company!at!this! time,!and!may!change!in!line!with!emerging!results,!circumstances!and!opportunities.!

Advantages,!disadvantages!and!risks!of!the!Proposal

The!New!Board!consider!that!the!Proposal!has!the!following!advantages!and!disadvantages:!

Advantage'–'improved'financial'condition :!The!Proposal!will!inject!the!Company!with!an! approximate!net!cash!amount!of!$1,385,250!and!the!Company!will!have!minimal!or!no! liabilities.!Currently,!the!Company!has!negative!net!assets.!
Advantage'–'greater'return'to'Creditors:' The!DOCA!provides!for!a!better,!more!certain!and! timely!outcome!for!all!creditors!than!would!result!from!the!liquidation!of!the!Company!(being! the!most!likely!other!option!if!the!Proposal!is!not!approved).!!
Disadvantage' –' concentration' of' ownership' within' members' of' the' Syndicate :! The! Securities! to! be! placed! to! the! Syndicate! pursuant! to! the! Proposal! will! constitute! up! to! approximately!80.88%!of!the!Company’s!fully!diluted!capital!(as!set!out!in!Table!5).!There! will!therefore!be!a!concentration!of!ownership!of!the!Company!among!the!members!of!the! Syndicate! (and! their! nominees).! This! may! allow! members! of! the! Syndicate! to! exert! significant!influence!over!matters!relating!to!the!Company,!including!the!election!of!future! Directors!or!the!approval!of!future!transactions!involving!the!Company.!Also,!given!the!size! of! the! holdings,! there! may! be! an! impact! on! the! liquidity! of! the! Company’s! securities.! However,!it!should!be!noted!that!(as!noted!previously)!following!completion!of!the!First! Placement!and!the!Second!Placement,!the!Syndicate!(or!their!nominees)!will!no!longer!be! acting! in! concert.! Therefore,! this! risk! should! not! be! taken! as! a! representation! that! the! members!of!the!Syndicate!(and!their!nominees)!will!act!in!concert!with!one!another]!would! be!likely!to!exercise!their!voting!rights!as!Shareholders!in!the!same!manner]!or!that!the! Syndicate! members! (and! their! nominees)! as! a! whole! are! associated! parties,! postU completion!of!the!Proposal.!
Disadvantage'–'control'by'incoming'Board:' As!outlined!in!Table!5,!the!proposed!maximum! voting!power!of!the!proposed!Directors!of!the!Company!is!36.38%.!Therefore,!there!will!be! a!concentration!of!ownership!of!the!Company!with!the!Board.!This!may!allow!the!Board!to! exert!significant!influence!over!matters!relating!to!the!Company.!
Risk'–'inability'to'meet'objectives'and'future'capital'requirements:' Despite!the!incoming! New!Board’s!intentions,!the!Company!may!be!unable!to!meet!the!objectives!set!out!in!this! Notice!of!Meeting.!The!Company’s!ongoing!activities!will!require!substantial!expenditure.! There!can!be!no!guarantee!that!the!funds!raised!under!the!Proposal!will!be!sufficient!to! successfully!achieve!all!the!objectives!of!the!Company’s!overall!business!strategy.!If!the! Company!is!unable!to!continue!to!use!debt!or!equity!to!fund!expansion!after!the!substantial! exhaustion! of! the! net! proceeds! of! the! Proposal,! there! can! be! no! assurances! that! the! Company!will!have!sufficient!capital!resources!for!that!purpose,!or!other!purposes,!or!that! it!will!be!able!to!obtain!additional!fundraising!on!terms!acceptable!to!the!Company!or!at!all.! Any!additional!equity!financing!may!be!dilutive!to!Security!holders!and!any!debt!financing! if!available!may!involve!restrictive!covenants,!which!may!limit!the!Company’s!operations! and!business!strategy.!!

The! Company’s! failure! to! raise! capital! if! and! when! needed! could! delay! or! suspend! the! Company’s!business!strategy!and!could!have!a!material!adverse!effect!on!the!Company’s! activities.!

Independent)Expert’s)Report

The!Corporations!Act!provides!that!an!IER!on!the!Proposal!(which!includes!the!acquisition!of! the!relevant!interest!in!the!Company!by!the!Syndicate!(or!their!nominees)!must!be!provided! to!shareholders.!The!IER!provides!an!opinion!as!to!whether!the!acquisition!of!the!voting!power! and!interest!referred!to!in!this!Explanatory!Statement!for!Resolution!4!by!the!Syndicate!(or! their!nominees)!is!fair!and!reasonable!to!the!nonUassociated!Shareholders!of!the!Company.!

Accordingly,! the! Syndicate! has! appointed! Stantons! International! Securities! ( Independent) Expert ),!a!professional!services!firm!based!in!Perth!as!an!independent!expert!to!produce!the! IER.!The!IER!is!contained!in!Annexure!A!of!this!Notice!of!Meeting.!

The!Independent!Expert!has!concluded!that!the!acquisition!of!the!voting!and!interest!by!the! Syndicate! (or! their! nominees)! may! on! balance! collectively! be! considered! to! be! fair! and! reasonable!to!the!nonUassociated!Shareholders!of!the!Company,!as!of!the!date!of!the!IER.!

The!advantages!and!disadvantages!of!the!acquisition!of!the!voting!power!and!interest!by! Syndicate!are!outlined!in!the!IER!and!are!provided!to!enable!nonUassociated!Shareholders!of! the!Company!to!determine!whether!they!are!better!off!if!the!acquisition!of!the!voting!power! and!interest!proceeds!as!opposed!to!if!it!did!not!proceed.!

Shareholders) are) urged) to) carefully) read) the) IER) before) deciding) how) to) vote) on Resolution)4.)

New)Board’s)Recommendation

The!New!Board!recommends!that!Shareholders!vote!in!favour!of!this!Resolution.!

Professional)Advice

If!you!have!any!doubt!or!do!not!understand!this!Resolution,!it!is!strongly!recommended!that! you!seek!advice!from!an!accountant,!solicitor!or!other!professional!advisor.!

RESOLUTIONS)5,)6,)7)and)8)–)RELATED)PARTY)APPROVALS)

For!a!public!company,!or!an!entity!that!the!public!company!controls,!to!give!a!financial!benefit! to!a!related!party!of!the!public!company,!the!public!company!or!entity!must:!!

(a)! obtain!the!approval!of!the!public!company’s!members!in!the!manner!set!out!in!sections! 217!to!227!of!the!Corporations!Act]!and!
(b)! give!the!benefit!within!15!months!following!such!approval,!unless!the!giving!of!the! financial! benefit! falls! within! an! exception! set! out! in! sections! 210! to! 216! of! the! Corporations!Act.!

ASX!Listing!Rule!10.11!provides!that!a!listed!company!must!not!issue!equity!securities!to!a! related!party!without!Shareholder!approval.!

A!“related!party”!for!the!purposes!of!the!ASX!Listing!Rules!is!widely!defined!and!includes!a! proposed!director!of!a!public!company!or!a!spouse!of!a!proposed!director!of!a!public!company.! The!definition!of!“related!party”!also!includes!a!person!whom!there!is!reasonable!grounds!to! believe!will!become!a!“related!party”!of!a!public!company.!

Messrs! Greg! Ruddock! ( Mr) Ruddock ),! Joshua! McKean! ( Mr) McKean ),! Glen! Dobbie! ( Mr) Dobbie )!and!Malcolm!Keefe!( Mr)Keefe )!are!all!proposed!Directors!of!the!Company.!

Therefore,!for!the!purposes!of!Chapter!2E,!Messrs!Ruddock,!McKean,!Dobbie!and!Keefe!are! related! parties! and! the! issue! of! Securities! constitute! the! giving! of! a! financial! benefit! (collectively!known!as!the! Related)Parties ).!Accordingly,!the!grant!of!Securities!to!the!Related! Parties!requires!the!Company!to!obtain!specific!Shareholder!approval!for!each!Director.!

The!New!Board!considers!that!the!issue!of!Second!Placement!Shares!to!the!Related!Parties! could!fall!within!the!“armsUlength!terms”!exception!set!out!in!section!210!of!the!Corporations! Act.!The!New!Board!have!based!their!belief!on!the!fact!that!the!Second!Placement!will!be!a! public! offer! available! to! general! investors,! some! of! whom! are! not! related! parties! to! the! Company.!However,!notwithstanding!this,!the!New!Board!have!considered!it!prudent!to!seek! related! party! approval! for! the! issue! of! all! Securities! to! the! Related! Parties,! including! the! Second!Placement!Shares.!

Therefore,!Resolutions!5,!6,!7!and!8!seek!Shareholder!approval!to!issue!Securities!to!the! Related!Parties!as!follows:!

Table)6)–)Issue)of)Securities)to)Related)Parties)

Resolution underthis Noticeof Meeting	Proposed Director	Max.First Placement Shares	Max.First Placement Options	Max.Second Placement Shares	Management Options	Max.Total Holding(Fully diluted)
5	MrRuddock	20,000,000	15,000,000	5,000,000	3,333,333	43,333,333
6	MrMcKean	20,000,000	15,000,000	5,000,000	3,333,333	43,333,333
7	MrDobbie	45,000,000	36,600,000	11,250,000	13,942,856	106,792,856
8	MrKeefe	20,000,000	15,000,000	5,000,000	5,714,286	45,714,286
Total		105,000,000	81,600,000	26,250,000	26,323,808	239,173,808

The!specific!number!of!Securities!proposed!to!be!issued!to!each!of!the!Related!Parties!was! agreed!based!on!commercial!negotiations!between!the!Syndicate!and!took!into!account!their! capacity!and!appetite!to!contribute!to!the!fundraising!and!recapitalisation!of!the!Company.!

Assuming!that!all!Resolutions!under!this!Notice!of!Meeting!are!approved!by!Shareholders,! Table!6!shows!that!the!maximum!total!Shares!to!be!issued!to!Related!Parties!(on!a!fully!diluted! basis)!is!239,173,808.!

Information)Required)by)ASX)Listing)Rule)10.13)

The! following! information! in! relation! to! the! securities! is! provided! to! shareholders! for! the! purposes!of!ASX!Listing!Rule!10.13:!

(a)! The!maximum!number!of!First!Placement!Shares,!First!Placement!Options,!Second! Placement!Shares!and!Management!Options!to!be!issued!to!the!Related!Parties!under! the!First!Placement!is!outlined!in!Table!6.!
(b)! The!issue!price!of!each!First!Placement!A!Share!being!issued!to!the!Related!Parties! is!$0.0025.!The!First!Placement!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.!Each!First!Placement!Option!being!issued!to!the!Related!Parties!is! being!issued!for!nil!consideration.!The!full!terms!of!the!First!Placement!Options!are!set! out!in!Annexure!C.!
(c)! The!issue!price!of!each!Second!Placement!Share!being!issued!to!the!Related!Parties! is!$0.01.!The!Second!Placement!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.!
(d)! No!consideration!is!payable!for!the!Management!Options!being!issued!to!the!Related! Parties.!The!full!terms!of!the!Management!Options!are!set!out!in!Annexures!D.!
(e)! The!issue!of!the!Company’s!Shares!and!Options!(including!Management!Options)!to! the! Related! Parties! will! occur! no! later! than! one! month! from! the! date! of! this! Extraordinary!General!Meeting!(or!such!later!date!to!the!extent!permitted!by!any!ASX! waiver!or!modification!of!the!ASX!Listing!Rules).!
(f)! The!Company!intends!to!use!the!funds!raised!from!the!Related!Parties!in!accordance! with!Table!3.!

Information)Required)by)Chapter)2E)of)the)Corporations)Act)

The!related!party!to!whom!the!proposed!Resolutions!would!permit!the!financial!benefit!to!be

given!

(a)! As!outlined!earlier!in!this!Explanatory!Statement,!each!of!the!Related!Parties!are!a! related!party!of!the!Company!to!whom!Resolutions!5,!6,!7!and!8!would!permit!the! financial!benefit!to!be!given.!

The!nature!of!the!financial!benefit!and!other!remuneration!of!the!relevant!directors

(b)! The!nature!of!the!financial!benefit!to!be!given!to!the!Related!Parties!are!the!issue!of! Securities!as!outlined!in!Table!6.!
(c)! As!of!the!date!of!this!Notice!of!Meeting,!none!of!the!Related!Parties!have!any!existing! and!current!holdings!in!the!Securities!of!the!Company.!
(d)! As!of!the!date!of!this!Notice!of!Meeting,!the!Related!Parties!have!not!received!any! remuneration! from! the! Company! for! both! the! current! and! previous! financial! years.!

However,!subject!to!successful!reinstatement!of!the!Company!to!Official!Quotation!on! the!ASX,!the!Related!Parties!will!be!paid!for!their!services!from!the!time!of!appointment! as!follows:!

Table)7)–)Proposed)Remuneration)for)Directors)

RelatedParties	ProposedRole	ProposedRemuneration (a)
GlenDobbie	ManagingDirector	Upto$100,000
MalcolmKeefe	NonUExecutiveDirector	Upto$100,000
GregRuddock	NonUExecutiveChairman	Upto$100,000
JoshuaMcKean	NonUExecutiveDirector	Upto$100,000

(a)!!Each!of!the!proposed!Directors!have!agreed!to!waive!their!remuneration!until!the!first!acquisition!that!is!material! to!the!Company!and!represents!an!acquisition!of!greater!than!50%!of!the!fully!diluted!market!capitalisation!of!the! Company!at!the!time!of!the!acquisition,!is!made!by!the!Company!( First)Acquisition ).!This!means!that!up!until!the! First!Acquisition!is!made,!the!no!remuneration!will!be!paid!to!the!directors.!!

Following!completion!of!the!First!Acquisition,!the!Board!will!approve!and!direct!a!payment!to!each!Director!to! ensure!that!the!Directors!receive!100%!of!their!base!salary!from!the!date!of!their!appointment!until!the!date!of!the! First!Acquisition.!Following!completion!of!the!First!Acquisition,!100%!of!the!base!salary!will!be!payable!monthly!to! the!Directors.!!!

(e)! The!First!Placement!A!Shares!and!Second!Placement!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.!
(f)! The!full!terms!of!the!First!Placement!Options!are!set!out!in!Annexure!C.!
(g)! The!full!terms!of!the!Management!Options!are!set!out!in!Annexures!D.!
(h)! Table!6!sets!out!the!possible!Shareholdings!of!each!of!the!Related!Parties!on!a!fully! diluted!basis.!This!assumes!that!all!First!Placement!Options!and!Management!Options! Placement!have!been!exercised!and!all!the!Management!Options!have!been!exercised! in!accordance!with!their!terms.!

New!Board’s!recommendation!and!basis!of!financial!benefit

(i)! The! Management! Options! under! Resolution! 3! will! be! issued! to! each! of! Messrs! Ruddock,!McKean,!Dobbie!and!Keefe!to!align!each!of!their!long!term!goals!with!that! of!Shareholders!and!to!incentivise!each!of!them!to!provide!ongoing!dedicated!services! to! the! Company.! These! Management! Options! are! intended! to! operate! so! that! the! financial!benefit!would!only!be!realised!once!the!share!price!doubles!when!compared! to!the!issue!price!under!the!Second!Placement.!!
(j)! Under! the! Company’s! current! circumstances,! the! New! Board! considers! that! the! incentives!noted!above!in!paragraph!(i)!are!a!cost!effective!and!efficient!reward!and! incentive!to!be!provided!to!the!proposed!Directors!of!the!Company,!as!opposed!to! alternative!forms!of!incentive,!such!as!the!payment!of!cash!consideration.!
(k)! The!New!Board!recommends!that!Shareholders!vote!in!favour!of!Resolutions!5,!6,!7! and!8!based!upon!the!opinion!expressed!in!the!IER.!
(l)! As! consideration! for! the! issue! of! Securities! to! the! Related! Parties! under! the! First! Placement!and!Second!Placement,!the!Company!will!raise!up!to!$500,000!in!funds.! The!breakdown!of!these!funds!and!the!financial!benefit!that!will!be!given!to!Related! Parties!is!depicted!in!the!table!below:!

Table)8)–)Funds)Raised)from)Related)Parties

RelatedParties	Max.First PlacementShares	Max.Second PlacementShares	Funds Invested
GregRuddock	20,000,000	5,000,000	100,000
JoshuaMcKean	20,000,000	5,000,000	100,000
GlenDobbie	45,000,000	11,250,000	225,000
MalcolmKeefe	20,000,000	5,000,000	100,000
Total	105,000,000	26,250,000	525,000

(m)! The!Company!intends!to!use!the!funds!raised!from!the!Related!Parties!in!accordance! with!Table!3.!

Capital!Structure!if!Shareholder!approval!is!obtained!for!all!Resolutions

(n)! The!proposed!capital!structure!of!the!Company!at!the!time!of!reinstatement!is!outlined! in!Table!1.!
(o)! The!dilutionary!effect!of!the!issue!of!Securities!to!each!of!the!Related!Parties!are!set! out!in!Table!6!and!Annexure!B.!On!a!fully!diluted!basis!(assuming!that!the!Second! Placement! is! fully! subscribed! and! all! First! Placement! Options! and! Management! Options!proposed!to!be!issued!under!this!Notice!of!Meeting!are!exercised):!
(i)! Mr!Ruddock!will!hold!a!shareholding!of!7.01%]!
(ii)! Mr!McKean!will!hold!a!shareholding!of!7.01%]!
(iii)! Mr!Dobbie!will!hold!a!shareholding!of!17.27%]!and!
(iv)! Mr!Keefe!will!hold!a!shareholding!of!7.39%.!

Existing!and!potential!relevant!interests

(p)! As!of!the!date!of!this!Notice!of!Meeting,!each!of!the!Related!Parties!currently!do!not,! either!directly!or!indirectly,!hold!any!Shares!or!Options!in!the!Company.!
(q)! The!potential!relevant!security!interest!in!the!Company!to!be!held!by!each!of!Related! Parties!is!outlined!in!Table!6.!
(r)! The!potential!voting!power!to!be!held!by!each!of!the!Related!Parties!is!outlined!in!Table! 6.!The!fully!diluted!percentages!have!been!calculated!on!the!assumption!that!certain! Options!in!the!Company!are!exercised,!and!therefore,!should!be!treated!with!caution! as:!
(i)! there!is!no!certainty!that!any!of!the!First!Placement!Options!or!Management! Options!will!be!exercised]!
(ii)! the!Options!to!be!issued!to!the!Related!Parties!will!be!part!of!a!larger!pool!of! Options!that!will!exist!if!all!the!Resolutions!under!this!Notice!of!Meeting!are! approved!by!Shareholders,!which,!if!exercised,!will!affect!the!relevant!interests! of!the!proposed!Directors!by!decreasing!them]!

Trading!history

(s)! The!Company’s!Shares!were!suspended!from!trading!on!the!ASX!on!20!February! 2013,! following! a! trading! halt! announced! on! 19! February! 2013.! Therefore,! on! 15! February!2013,!which!was!its!final!day!of!trading!prior!to!suspension,!the!Company’s! share!price!closed!at!$0.001!!
(t)! The!First!Placement!Options!will!not!be!quoted!on!ASX.!The!Company!has!valued!the! First! Placement! Options! to! be! granted! to! the! Related! Parties! using! the! Black! and! Scholes!Option!Pricing!model.!A!summary!of!the!valuation!inputs!are!outlined!in!clause! 8.9!of!the!IER.!Based!on!the!value!ascribed!in!the!IER,!the!First!Placement!Options!to! be!granted!to!the!Related!Parties!under!Resolutions!5,!6,!7!and!8!have!been!valued! as!follows:!

Table)9)–)First)Placement)Options)Valuation

Description	ExpiryDate	Exercise Price	Volatility	Valueforone First Placement Optionbefore discounting	Discount rate	Valueforone First Placement Optionafter discounting
FirstPlacement Options	3yearsfrom issuedate	0.01	75%	$0.0044	25%	0.0033

(u)! Based!on!Table!10,!the!value!of!the!First!Placement!Options!to!be!issued!to!each!of! the!Related!Parties!are!as!follows:!

Table)10)–)First)Placement)Option)Holdings)Value)

ProposedDirector	Max.FirstPlacementOptions	ValueofFirstPlacementOptions
GregRuddock	15,000,000	$49,869
JoshuaMcKean	15,000,000	$49,869
GlenDobbie	36,600,000	$121,680
MalcolmKeefe	15,000,000	$49,869

Valuation!of!the!Management!Options

(v)! The!Management!Options!will!not!be!quoted!on!ASX.!The!Company!has!valued!the! Management!Options!to!be!granted!to!the!Related!Parties!using!the!Black!and!Scholes! Option!Pricing!model.!The!Management!Options!to!be!granted!to!the!Related!Parties! under!Resolutions!5,!6,!7!and!8!have!been!valued!as!follows:!

Table)11)–)Management)Options)Valuation

Description	ExpiryDate	Exercise Price	Volatility	Valueforone First Placement Optionbefore discounting	Discount rate	Valueforone First Placement Optionafter discounting
Options	4yearsfrom issuedate	0.02	75%	0.0125	25%	0.0094

Notes:)

(w)! Based!on!Table!12,!the!value!of!the!Management!Options!to!be!issued!to!each!of!the! Related!Parties!are!as!follows:!

Table)12)–)Management)Option)Holdings)Value)

ProposedDirector	Max.Options	ValueofOptions
GregRuddock	3,333,333	31,402
JoshuaMcKean	3,333,333	31,402
GlenDobbie	13,942,856	131,348
MalcolmKeefe	5,714,286	53,831

RESOLUTIONS)9,)10,)11)and)12)–)ELECTION)OF)DIRECTORS))

Resolutions! 9,! 10,! 11! and! 12! seek! Shareholder! approval! for! the! election! of! Messrs! Greg! Ruddock,!Joshua!McKean,!Glen!Dobbie!and!Malcolm!Keefe!as!Directors!of!the!Company! pursuant!to!clause!7.2!of!the!Company’s!Constitution!and!section!201E!of!the!Corporations! Act.!!

Set!out!below!is!a!summary!of!the!background!for!each!of!the!proposed!Directors!and!their! respective!titles.!

Mr!Greg!Ruddock,!NonUExecutive!Chairman!–!Resolution!9

Greg!is!the!Joint!Chief!Executive!Officer!of!Ironbridge!and!coUleads!Investment!and!Portfolio! Management!activities!with!Neil!Broekhuizen.!Greg!has!13!years!of!private!equity!experience! with!GPEL!and!Ironbridge.!

Prior! to! joining! GPEL! in! 1999,! Greg! had! twelve! years! operational! experience! at! leading! Australian!industrial!group!Wesfarmers!and!with!diversified!listed!company!Avatar,!where!he! was!Managing!Director!of!one!of!its!major!subsidiaries.!

Within! the! GPEL! portfolio! Greg! led! the! successful! development! of! Electronic! Banking! Solutions/Cashcard!("EBS/Cashcard").!In!2003!Greg!became!one!of!the!Founding!Partners! of! Ironbridge! and! has! led! its! successful! financial! and! outsourced! services! investment! programme!across!both!Ironbridge!Funds.!

Greg!has!sat!on!the!Ironbridge!Investment!Committee!since!inception!and!has!represented! the! Ironbridge! Funds! on! the! Boards! of! Stardex,! Super! AUmart,! EnviroWaste,! Easternwell,! FleetPartners,!ISGM!and!AOS.!

Greg! qualified! as! an! accountant! and! holds! a! Bachelor! of! Commerce! degree! from! the! University!of!Western!Australia.!

Mr!Joshua!McKean,!NonUExecutive!Director!–!Resolution!10!

Josh!joined!the!private!equity!industry!in!the!early!2000’s!at!JPMorgan!where!helped!establish! their!Small!Caps!M&A!and!Financial!Sponsors!practice!in!Sydney.!!Having!advised!on!the! merger!of!Gresham!Private!Equity’s!EBS!with!Cashcard,!Josh!joined!Cashcard!as!Business! Development!Manager.!!From!there!Josh!joined!the!leading!global!private!equity!manager!in! Sydney,!CVC!Capital!Partners.!

Whilst! at! Cashcard! Josh! led! due! diligence! on! a! number! of! acquisitions,! including! the! successful! acquisition! of! Direct! Cash,! a! Melbourne! based! ATM! deployer! and! assisted! Gresham!Private!Equity!in!preparing!the!business!for!exit!via!a!dualUtrack!process.!

Josh!joined!CVC!Capital!Partners!in!2003!and!worked!on!a!number!of!successful!transactions! including!the!A$1.2!billion!IPO!of!Pacific!Brands,!the!sale!of!Tech!Pacific!to!Ingram!Micro!for! A$700!million,!and!the!acquisition!and!subsequent!divestment!of!Affinity!Health!to!Ramsay! Healthcare!for!A$1.4!billion.!

Josh!joined!Ironbridge!in!October!2005!and!has!played!a!lead!role!in!the!Ironbridge!Fund’s! investment!in!Super!AUMart,!the!turnaround!of!Barbeques!Galore!Australia!which!has!tripled! EBITDA!as!well!as!the!subsequent!merger!of!Super!AUMart!and!Barbeques!Galore!Australia! to!form!BBQSAM.!

Within! the! Ironbridge! Fund! II! portfolio! Josh! has! led! the! successful! investments! into! Easternwell,!a!buy!and!build!of!a!specialist!mining!services!business!that!successfully!exited! to!Transfield!and!its!investment!in!Infrastructure!Services!Group!(ISGM),!a!leading!provider!of! advisory!and!outsourcing!services!in!the!Australian!market!that!has!quadrupled!EBITDA!in!the! last!4!years!and!ranked!9th!in!the!2014!BRW!Fast!100.!

Josh!holds!a!Bachelor!of!Commerce!degree!with!Honours!(First!Class)!from!the!University!of! Melbourne.!

Mr!Glen!Dobbie,!Managing!Director!–!Resolution!11

Glen!is!the!Managing!Partner!of!Auxano!LLP,!a!group!of!proven!investors!and!operators!that! invest!in!businesses!and!actively!provide!them!with!whatever!they!need!to!grow.!Glen!was! formerly!the!Group!Commercial!Director!at!Arowana!&!Co,!where!he!was!primarily!responsible! for! the! operations! of! the! ASX! listed,! Arowana! International! Limited.! During! his! 8! years! at! Arowana!&!Co,!the!firm!recorded!returns!of!over!40%!per!annum!and!Arowana!International! Limited’s!share!price!rose!to!$1.00!from!a!listing!price!of!$0.35.!!

Most! recently,! Glen! was! instrumental! in! creating! the! Intueri! Education! Group! (including! performing! the! role! of! interim! CEO! and! nonUexecutive! director)! which! led! to! a! successful! $220m!IPO!in!2014.!This!investment!returned!Arowana!International!Limited!shareholders! over!$100m!profit!and!foundation!shareholders!over!7.5!times!their!initial!investment.!

Glen!has!particular!experience!in!“hands!on”!operational!management!across!a!variety!of! industries!including!education,!events!and!training,!traffic!management!and!control,!electrical! maintenance!and!thermal!imaging!businesses.!

Glen!has!been!involved!in!various!capital!raising!activities!and!held!directorships!across!a! range!of!sectors!for!listed!and!unlisted!companies!as!well!as!private!equity!funds.!!

Glen! has! earned! a! Graduate! Diploma! of! Chartered! Accounting! from! ICAA,! a! Bachelor! of! Commerce!(Honours)!from!UNSW!and!is!a!certified!Gazelles!International!business!growth! coach.!

Mr!Malcolm!Keefe,!NonUExecutive!Director!–!Resolution!12

Malcolm!has!over!30!years!of!general!management!experience!in!a!variety!of!businesses! including!education,!information!technology,!print,!and!office!products.!

Malcolm!is!a!partner!of!Auxano!LLP.!Prior!to!this!role,!Malcolm!served!as!the!NonUExecutive! Independent!Chairman!and!Director!of!Arowana!International!Limited!from!November!2011!to! March!2015.!

Malcolm!has!served!as!Executive!Director!and!Chief!Operating!Officer!at!Corporate!Express! Australia!Ltd!(also!known!as!Staples!Australia!Pty!Limited)!until!February!2010!and!during!his! tenure!the!Company!was!one!of!the!best!performing!on!the!ASX!with!controlled!and!sustained! growth.!!

Malcolm!also!served!as!Chief!Executive!Officer!of!Kalamazoo!(Aust)!Pty!Limited.!He!held! senior!management!positions!with!the!Swire!Group!in!Hong!Kong!and!with!Kalamazoo!PLC! in!the!United!Kingdom.!!

Malcolm!has!a!B.Sc.!(Hons)!from!University!of!London.!

Proposed!Directors’!interests

As!at!the!date!of!this!Notice!of!Meeting,!none!of!the!proposed!Directors!mentioned!above!have! an!interest!(direct!or!indirect)!in!the!current!issued!capital!of!the!Company.!

Company!Secretary

Mr!Andrew!Whitten!will!assist!the!Board!in!their!duties!as!the!proposed!Company!Secretary! of!the!Company.!!

New)Board’s)Recommendation

The!New!Board!considers!that!it!is!in!the!best!interests!of!the!Company!that!it!adopts!the!New! Constitution.!Accordingly,!the!New!Board!recommends!that!Shareholders!vote!in!favour!of! Resolutions!9!to!12.!

RESOLUTION)13)–)REPEAL)AND)ADOPTION)OF)A)CONSTITUTION))

The!Company’s!current!constitution!was!adopted!by!the!Company!on!22!November!2004.!!

The! Company! intends! to! change! its! constitution! ( New) Constitution )! so! that! it! is! more! appropriate!for!an!ASX!listed!company!as!the!constitution!has!not!been!updated!for!more!than! 10!years!to!reflect!changes!in!the!Corporations!Act!and!ASX!Listing!Rules.!

A!complete!signed!copy!of!the!New!Constitution!will!be!tabled!at!the!Extraordinary!General! Meeting.!

This!Resolution!is!a!special!resolution,!and!as!such,!it!can!only!be!passed!if!at!least!75%!of! the!total!votes!cast!by!Shareholders!entitled!to!vote!on!this!Resolution!are!voted!in!its!favour.!!

New)Board’s)Recommendation

Professional)Advice

If!you!have!any!doubt!or!do!not!understand!this!Resolution,!it!is!strongly!recommended!that! you!seek!advice!from!a!solicitor!or!other!professional!advisor.!

RESOLUTIONS)14)and)15)–)REMOVAL)AND)APPOINTMENT)OF)AUDITORS))

Under!section!329!of!the!Corporations!Act,!an!auditor!of!a!company!may!be!removed!from! office!by!resolution!of!a!general!meeting!of!which!2!months’!notice!of!intention!to!move!the! resolution!has!been!given.!

It!should!be!noted!that!under!this!section,!if!a!company!calls!a!meeting!after!the!notice!of! intention!has!been!given,!the!meeting!may!pass!the!resolution!even!though!the!meeting!is! held!less!than!2!months!after!the!notice!of!intention!is!given.!

Resolution!14!is!an!ordinary!resolution!seeking!the!removal!of!HLB!Mann!Judd!as!the!auditor! of!the!Company.!An!auditor!may!be!removed!in!a!general!meeting!provided!that!the!notice!of! intention!to!remove!the!auditor!has!been!received!by!the!Company.!

In!accordance!with!section!329(2)!of!the!Corporations!Act,!the!Company!has!sent!a!copy!of! the!notice!to!PKF!Hacketts!Audit!and!ASIC.!

Under!section!327D!of!the!Corporations!Act,!the!Company!in!a!general!meeting!may!appoint! an!auditor!to!replace!an!auditor!removed!under!section!329!of!the!Corporations!Act.!

Resolution!15!is!a!special!resolution!seeking!the!appointment!of!PKF!Hacketts!Audit!as!the! new! auditor! of! the! Company.! As! required! by! the! Corporations! Act,! a! nomination! for! PKF! Hacketts! Audit! to! be! appointed! as! the! auditor! of! the! Company! has! been! received! from! a! Shareholder!of!the!Company.!A!copy!of!the!nomination!of!PKF!Hacketts!Audit!as!auditor!is! set!out!at!Annexure!E.!

PKF! Hacketts! Audit! has! given! its! written! consent! to! act! as! the! Company’s! auditor! in! accordance!with!section!328A(1)!of!the!Corporations!Act,!subject!to!Shareholder!approval!of! this!Resolution.!

If!all!Resolutions!(other!than!Resolutions!13!and!14)!under!this!Notice!of!Meeting!are!passed,! the!appointment!of!PKF!Hacketts!Audit!as!the!Company’s!auditor!will!take!effect!immediately,! at!the!close!of!this!Extraordinary!General!Meeting.!!

Resolutions! 14! and! 15! are! subject! to! the! passing! of! all! the! other! Resolutions! (other! than! Resolutions!13!and!16)!under!this!Notice!of!Meeting.!

RESOLUTION)16)–)INCREASE)NONdEXECUTIVE)DIRECTORS’)FEE)POOL)

In!accordance!with!Listing!Rule!10.17!and!clause!7.5!of!the!Company’s!current!constitution,! Shareholder!approval!is!sought!to!increase!the!maximum!aggregate!amount!available!for!nonU executive!directors’!remuneration!in!any!financial!year!( NED)Fee)Pool )!by!$300,000,!from! $200,000!to!$500,000.!The!current!NED!Fee!Pool!was!fixed!at!an!Annual!General!Meeting!of! the!Company!on!23!November!2006.!

The!Directors!seek!Shareholder!approval!to!increase!to!NED!Fee!Pool!as:!

it!is!important!to!ensure!that!the!Company!maintains!the!ability!to!pay!competitive!fees! and!attract!and!retain!high!calibre!nonUexecutive!directors]!and!
the!size!of!the!proposed!increase!would!be!consistent!with!other!ASX!listed!entities!of! similar!market!capitalisation.!!

It!is!not!intended!that!should!this!resolution!be!passed,!the!maximum!aggregate!of!the!NED! Feel!Pool!would!be!utilised!immediately.!The!proportion!remaining!unused!will!provide!the! Company!with!the!ability!to!attract!and!retain!high!quality!directors,!to!make!any!appropriate! increases! to! the! size! of! the! Board! and! to! increase! fees! in! the! future! in! line! with! market! conditions.!

It!is!proposed!that!the!increase!in!the!NED!Fee!Pool!will!take!effect!immediately!after!the! Meeting.!

As!required!by!ASX!Listing!Rule!10.17,!the!Company!confirms!that!no!securities!have!been! issued!to!nonUexecutive!directors!in!the!preceding!three!years!under!Listing!Rules!10.11!or! 10.14.!

Given!the!nature!of!this!Resolution,!the!Board!does!not!consider!that!it!is!appropriate!to!make! a!recommendation!on!how!Shareholders!should!vote!on!this!Resolution.!As!noted!in!the!Proxy! Form,!the!Chairman!of!the!Meeting!intends!to!cast!all!undirected!proxies!in!favour!of!this! Resolution.!

ENQUIRIES)

Shareholders!are!asked!to!contact!Philip!Girling!on!(08)!9322!2022!if!they!have!any!queries! in!respect!of!the!matters!set!out!in!these!documents.!

GLOSSARY)

AWST !means!Australian!Western!Standard!Time,!as!observed!in!Perth,!Western!Australia.!

ASIC) means!Australian!Securities!and!Investment!Commission.!

ASX !means!ASX!Limited!(ACN!008!624!691)!or!the!financial!market!operated!by!it,!as!the! context!requires,!of!20!Bridge!Street,!Sydney,!NSW!2000.!

ASX)Listing)Rules) means!the!official!listing!rules!of!the!ASX!and!any!other!rules!of!the!ASX! which!are!applicable!while!the!Company!is!admitted!to!the!official!list!of!the!ASX,!as!amended! or!replaced!from!time!to!time,!except!to!the!extent!of!any!express!written!waiver!by!the!ASX.!

Auxano) means!Auxano!LLP!of!Level!12,!95!Pitt!Street!Sydney!NSW!2000.!

Board) means!the!current!board!of!Directors!of!the!Company.!

Business)Day) means!Monday!to!Friday!inclusive,!except!New!Year’s!Day,!Good!Friday,!Easter! Monday,!Christmas!Day,!Boxing!Day,!and!any!other!day!that!ASX!declares!is!not!a!business!day.!

Company !or! NAV) means!Navigator!Resources!Limited!(ACN!063!366!487)!(Subject!to!Deed! of!Company!Arrangement)!care!of!Pitcher!Partners,!Level!1,!914!Hay!Street,!Perth!Western! Australia.!

Constitution) means!the!Company’s!constitution.!

Corporations)Act !means!the! Corporations'Act !2001!(Cth)!as!amended!or!replaced!from!time! to!time.!

Creditors)Trust !means!the!trust!established!pursuant!to!the!Creditors’!Trust!Deed!for!the! purposes!of!satisfying!approved!creditor!claims.!

Creditors)Trust)Deed !means!the!Creditors!Trust!Deed!entered!into!by!the!Company!on!9! September!2015.!

Deed)Administrator) and! Administrator) means!Bryan!Hughes!of!Pitcher!Partners,!Level!1,! 914!Hay!Street,!Perth,!Western!Australia.!!

Director !means!a!current!or!proposed!director!of!the!Company,!as!the!context!requires.!

DOCA !means!the!revised!Deed!of!Company!Arrangement!entered!into!by!the!Company!with! the!Syndicate!on!9!September!2015.!

Dollar) or!“ $ ” means!Australian!dollars.!

Explanatory) Statement ! means! the! explanatory! statement! accompanying! this! Notice! of! Meeting.!

Extraordinary)General)Meeting !or! Meeting) means!the!meeting!of!the!Company’s!members! convened!by!this!Notice!of!Meeting.

First) Placement Securities) means! the! placement! of! First! Placement! A! Shares,! First! Placement!B!Shares,!and!First!Placement!Options!collectively.!

First)Placement)A)Shares) means!200,000!Shares!issued!pursuant!to!the!First!Placement!at! a!price!of!$0.0025!per!share.!!

First)Placement)B)Shares) means!25,000,000!Shares!issued!pursuant!to!the!First!Placement! at!an!issue!price!of!$0.00001!per!share.!!

First)Placement)Options !means!an!Option!to!subscribe!for!one!(1)!Share!in!the!Company! for!nil!consideration!per!Option!that!is!being!issued!as!part!of!the!First!Placement.!

First) Placement) Shares means! the! First! Class! A! Shares! and! First! Class! B! Shares! collectively.!

NAV !means!Navigator!Resources!Limited!(ACN!063!366!487).!

Independent)Expert) means!Stantons!International!Securities!Pty!Ltd!(ABN!42!128!908!289)!of! Level!2,!1!Walker!Avenue,!West!Perth,!WA!6005.!

Independent)Expert’s)Report !means!the!report!by!the!Independent!Expert!dated!30!November! 2015!annexed!to!this!Notice!of!Extraordinary!General!Meeting!as!Annexure!A.!

Management) Options means! Options! which! are! issued! to! proposed! Directors,! key! management!and!advisers!of!the!Company!as!a!means!to!provide!remuneration,!incentives!or! any!other!reasons!as!the!Board!at!the!time!deems!appropriate.!!

Management)Optionholder !means!a!person!holding!a!Management!Option.!

New)Board !means!the!proposed!Board!of!Directors!of!the!Company!constituting!of!Messrs! Glen!Dobbie,!Malcolm!Keefe,!Greg!Ruddock!and!Joshua!McKean.!

New)Constitution !means!the!constitution!that!will!be!tabled!at!this!Notice!of!Meeting!and! proposed!to!be!adopted!by!the!Company!as!its!constitution.!A!copy!of!the!New!Constitution! can!be!viewed!before!the!Extraordinary!General!Meeting!by!sending!a!written!request!to!the! Company.!

Notice) of) Meeting ! or! Notice) of) Extraordinary) General) Meeting) means! this! Notice! of! Extraordinary!General!Meeting!dated!21!January!2016!including!the!Explanatory!Statement.!

Official)List !means!the!official!list!of!ASX.!

Official)Quotation !means!official!quotation!of!the!Company’s!Shares!on!ASX.!

Option !means!an!option!to!acquire!a!Share.!

Optionholder !means!a!holder!of!an!Option.!

Otsana) means!Otsana!Capital!of!108!Outram!Street,!West!Perth,!Western!Australia!6005!

Proposal means! the! proposal! presented! by! the! Syndicate! for! the! restructure! and! recapitalisation!of!the!Company!that!was!accepted!by!the!Creditors!of!the!Company,!together! with!the!Deed!Administrator!on!25!March!2015.!

Proxy)Form) means!the!proxy!form!attached!to!this!Notice!of!Meeting.!

Related)Party) or! Related)Parties !means!each!of!Messrs!Glen!Dobbie,!Malcolm!Keefe,!Greg! Ruddock!and!Joshua!McKean.!!

Resolutions) means!the!resolutions!set!out!in!this!Notice!of!Meeting,!or!any!one!of!them,!as! the!context!requires.!

Second)Placement)Shares !means!the!placement!subject!of!Resolution!2,!being!the!issue!of! up!to!150,000,000!Second!Placement!Shares!to!general!investors!that!may!include!members! of!the!Syndicate!(or!their!nominees).!

Second)Placement)Shares !means!a!Share!in!the!Company!at!an!issue!price!of!$0.01!per! Share!that!is!being!issued!as!part!of!the!Second!Placement!

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

Shareholder !means!a!holder!of!a!Share.!

Syndicate !means!the!syndicate!headed!by!Otsana!and!Auxano!that!made!the!Proposal!to! the!Company.!

VWAP !means!Volume!Weighted!Average!Price.

ANNEXURE)A)–)INDEPENDENT)EXPERT’S)REPORT)

PO Box 1908 West Perth WA 6872 Australia

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Level 2, 1 Walker Avenue West Perth WA 6005 Australia

30 November 2015

The Deed Administrators Navigator Resources Limited C- Whittens, Lawyers Unit 5, 139 Bathurst Street SYDNEY NSW 2000

Tel: +61 8 9481 3188 Fax: +61 8 9321 1204 ABN: 84 144 581 519 AFS Licence No: 448697 www.stantons.com.au

Summary of Opinion

For the purposes of Section 611 (item 7) of TCA, in relation to the approval to issue up to 225,000,000 First Placement Shares, 175,000,000 First Placement Options, and 50,000,000 Second Placement Shares and 50,000,000 Management Options, in our opinion taking into account the factors noted elsewhere in this report including the factors (positive, negative and other factors) noted in section 7 of this report, the proposal as outlined in paragraph 1.1 and Resolution 4 may on balance collectively be considered to be fair and reasonable at the date of this report.

Dear Sirs

RE: NAVIGATOR RESOURCES LIMITED (“NAV” OR “THE COMPANY”) (ACN 063 366 487) ON THE PROPOSAL THAT SHAREHOLDERS APPROVE THE ISSUE OF UP TO 200,000,000 SHARES AT 0.25 CENTS EACH, UP TO 25,000,000 SHARES AT 0.001 CENTS EACH, UP TO 175,000,000 OPTIONS AT AN EXERCISE PRICE OF 1 CENT EACH, UP TO 50,000,000 SHARES AT 1 CENT EACH AND UP TO 50,000,000 OPTIONS AT AN EXERCISE PRICE OF 2 CENTS EACH AS NOTED BELOW AND IN RESOLUTIONS 4, 5, 6, 7 AND 8 TO CUMULATIVELY RAISE $1,000,250 (FROM A TOTAL CAPITAL RAISING OF UP TO $2,000,250). MEETING PURSUANT TO SECTION 611 (ITEM 7) OF THE CORPORATIONS ACT 2001 (“TCA”).

1. Introduction

1.1 We have been requested by the Syndicate (refer to paragraph 1.4) to prepare an Independent Expert’s Report to determine the fairness and reasonableness relating to the proposals as set out in Resolution 4 of the Notice of Meeting (“the Notice”) and more fully described in the Explanatory Statement (“ES”) attached to the Notice to be disseminated to shareholders of NAV in or around December 2015.

Resolution 4 relates to issue a total of up to 225,000,000 ordinary shares (“First Placement Shares”) in NAV of which 200,000,000 will be issued at an issue price of 0.25 cents each to raise up to a gross $500,000 (“First Placement A Shares”) and 25,000,000 will be issued at 0.001 cents each to raise a gross up to $250 (“First Placement B Shares”), the proposal to issue up to 175,000,000 options in NAV (“First Placement Options”) for nil consideration to be exercisable at 1 cent per First Placement Option with an expiry date on or before three (3) years from date of issue, the proposal to issue up to 50,000,000 ordinary shares (out of 150,000,000 shares) (“Second Placement Shares”) in NAV at an issue price of 1 cent per share to raise up to a gross $500,000 (out of a maximum up to $1,500,000) and the proposal to issue up to 50,000,000 options in NAV (“Management Options”) to be exercisable at 2 cents per option on or before four (4) years from date of issue.

1.2 Overall, it is planned as part of the recapitalisation of NAV, to issue 225,000,000 First Placement Shares to raise up to $500,250 (up to 200,000,000 Placement A Shares at 0.25 cents each and 25,000,000 First Placement B Shares at 0.001 cents each) (both part of Resolution 1 and 4); up to 150,000,000 Second Placement Shares at 1 cent each to raise up to $1,500,000 (part of Resolution 1 and of which 50,000,000 First Placement Shares are being issued under Resolution 4); the issue of up to 175,000,000 First Placement Options (part of Resolutions 1 and 4) at nil consideration and the issue of up to 50,000,000 Management Options (part of Resolutions 3 and 4) issued for nil consideration.

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Liability limited by a scheme approved under Professional Standards Legislation

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Resolutions 5 to 8 also refer to the issue of some of the First Placement Shares, Second Placement Shares, First Placement Options and Management Options to be issued to the proposed new Directors of NAV. The proposed election of the new Directors to the Board of NAV are outlined in Resolutions 9 to 12. The proposed new Directors (Greg Ruddock, Joshua McKean, Glen Dobbie and Malcolm Keefe) are also referred to in this report and the ES attached to the Notice as the Related Parties. Glen Dobbie is also the sole shareholder and director of Auxano LLP (as noted below).

1.3 The issue of the First Placement Shares includes the issues of up to 225,000,000 ordinary NAV shares to a syndicate of investors formed by Otsana Capital and Auxano LLP (’the Syndicate”). The Syndicate is also to be issued up to a further 175,000,000 First Placement Options, up to a further 50,000,000 Second Placement Shares (of up to 150,000,000 Second Placement Shares) and up to 50,000,000 Management Options. The Syndicate includes the proposed new Directors (Related Parties) of the Company. As noted above the issue of shares and options to the Syndicate require specific approval as outlined in Resolution 4 and the issue of shares and options to the Related Parties require specific approvals under Resolutions 5 to 8.
1.4 The proposed issue of up to 225,000,000 First Placement Shares, up to 175,000,000 First Placement Options, up to 50,000,000 Second Placement Shares and up to 50,000,000 Management Options to the Syndicate, is referred to in this report as the “Syndicate Subscription” as part of a maximum total $2,000,250 capital raising as noted below (before the potential exercise of First Placement Options and Management Options).

In addition to the Syndicate Subscription, the additional proposed issue of up to a further 100,000,000 Second Placement Shares to raise a further up to $1,000,000 is referred to as the “Placement Subscription”. The issue of First Placement Shares and Second Placement Shares to the Syndicate is referred to as “Syndicate Subscription Shares”, whilst the issue of First Placement Options and Management Options to the Syndicate is referred to as “Syndicate Subscription Options”. The Syndicate Subscription, which is included as part of the proposal as set out in Resolution 4, is also individually voted upon by non-associated shareholders of NAV (that is shareholders not associated with the Syndicate or its nominees).

1.5 The Resolutions pertaining to the maximum issue of First Placement Shares, First Placement Options, Second Placement Shares and Management Options amongst the Syndicate and others is as follows:

Resolution	Parties to be	Maximum First	Issue and	Maximum	Issue and	Total	Maximum
	issued Securities	Placement	Exercise of	Second	Exercise of	Potential	Voting
		Shares to be	First	Placement	Management	Share Issue	Power
		issued	Placement	Shares to be	Options
			Options	issued

5	Greg Ruddock	20,000,000	15,000,000	5,000,000	3,333,333	43,333,333	7.01%


6	Joshua McKean	20,000,000	15,000,000	5,000,000	3,333,333	43,333,333	7.01%


7	Glen Dobbie	45,000,000	36,600,000	11,250,000	13,942,856	106,792,856	17.28%


8	Malcolm Keefe	20,000,000	15,000,000	5,000,000	5,714,286	45,714,286	7.39%


	Total Related
	Parties	105,000,000	81,600,000	26,250,000	26,323,808	239,173,808	38.69%
	Subscription


	Other Associates
Part of 4		120,000,000	93,400,000	23,750,000	23,676,192	260,826,192	42.19%
	(non- related parties)


	Total Syndicate
4		225,000,000	175,000,000	50,000,000	50,000,000	500,000,000	80.88%
	Subscription

	Other Non
2		-	-	100,000,000	-	100,000,000	16.17%
	Associated Parties


1 to 8	Total	225,000,000	175,000,000	150,000,000	50,000,000	600,000,000	97.05%

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1.6 Currently, there are 18,223,695 shares on issue and if all First Placement Shares and Second Placement Shares are issued, there would be 393,223,695 shares on issue and if all First Placement Options were exercised, there would be 568,223,695 shares on issue and if the Management Options were also exercised, the number of shares on issue would be 618,223,695.

Prior to the exercise of the First Placement Options and the Management Options, the collective shareholding of the Syndicate members in the ordinary share capital of NAV would approximate 69.93%. Further details on shareholding interests of the Syndicate and Related Parties are noted in the ES.

1.7 On 28 March 2013 NAV (subject to Deed of Company Arrangement) was placed into voluntary administration, with Mr Bryan Hughes of Pitchers Partners appointed as Administrator (“Administrators” and “Deed Administrators ” ) of the Company and assumed control of the Company and its business, property and affairs.

A deed of company arrangement was entered into on 31 May 2013.

On 11 August 2015, creditors of the Company (“Creditors”) voted in favour of a revision of the deed of company arrangement (“DOCA”) submitted by a syndicate of investors formed by Otsana Capital and Auxano LLP (together forms part of the “Syndicate”), which dealt with the Company’s Cummins Range rare earths exploration project and also contemplated the subsequent restructure and recapitalisation of the Company including the settlement of the claims of the Creditors (Proposal).

On 9 September 2015, the Deed Administrators entered into a variation of the previous arrangements and the DOCA with the Syndicate to effect the terms of the Proposal was executed (“DOCA ” ).

1.8 The above Restructure is subject to the Company obtaining necessary shareholder approvals and any ASX regulatory re-quotation approvals, as well as NAV being released from all liabilities and long term commitments through the contemporaneous effectuation of the DOCA and payment of cash consideration. Inter alia, the Company’s secured creditors (if any) must also vote to release security over assets, and all creditors will be required to be satisfied from the Creditors Trust. Furthermore, all subsidiaries of NAV shall be excised from NAV (unless required by the Syndicate).
1.9 Under Section 606 of TCA, a person must not acquire a relevant interest in issued voting shares in a company if because of the transaction, that persons or someone else's voting power in the company increases:
(a) from 20% or below to more than 20%; or
(b) from a starting point that is above 20% and below 90%.

Under Section 611 (Item 7) of TCA, section 606 does not apply in relation to any acquisition of shares in a company approved by resolution passed at a general meeting at which no votes were cast in favour of the resolution by the acquirer or the disposer or their respective associates. An independent expert is required to report on the fairness and reasonableness of the transaction pursuant to a Section 611 (Item 7) meeting.

1.10 Following completion of the Restructure and the other proposals noted in paragraph 1.2 above and in the Notice, the Syndicate who currently holds nil shares in NAV would own a total of 275,000,000 shares in NAV (not including the potential issue and exercise of First Placement Options and Management Options) representing approximately 69.93% of the then shares on issue (assuming no other shares are issued or options converted). There would be 393,223,695 NAV shares on issue.

Accordingly, should the First Placement Options and Management Options be issued and exercised, the Syndicate could own approximately 500,000,000 shares in the expanded capital of NAV, and this would represent approximately 80.88% of the then expanded

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shares on issue in NAV (total shares on issue would increase to 618,223,695). As it is envisaged that the Syndicate would collectively hold approximately 69.93% of the issued capital of NAV (post issuance of the First Placement Shares and Second Placement Shares, but before the issue and exercise of the First Placement Options and Management Options), and hold approximately 80.88% of the expanded share capital of NAV (post issuance and exercise of First Placement Options and Management Options), the Syndicate will be deemed to have control of NAV and will have effective Board control post the effectuation of the Restructure. The new Board (the Related Parties who are part of the Syndicate) will collectively control approximately 33.38% of the expanded issued capital of NAV before the exercise of any First Placement Options and any Management Options. If all First Placement Options and any Management Options were also exercised, the new Board would control approximately 38.68% of the shares on issue in NAV (assuming no further share issues).

1.11 Individually, the Related Parties, namely Messer’s Ruddock, McKean, Dobbie and Keefe, would own 6.36%, 6.36%, 14.30% and 6.36% respectively of the issued capital of NAV (before the issue and potential exercise of First Placement Options and Management Options). Should the First Placement Options and Management Options be issued and fully exercised, Messer’s Ruddock, McKean, Dobbie and Keefe would individually own 7.01%, 7.01%, 17.27% and 7.39% of the Company respectively.
1.12 A notice prepared in relation to a meeting of shareholders convened for the purposes of Section 611 (Item 7) of TCA should be accompanied by an independent expert's report stating whether it is fair and reasonable to approve the issue of up to 225,000,000 First Placement Shares, up to 175,000,000 First Placement Options, up to 50,000,000 Second Placement Shares and up to 50,000,000 Management Options to raise a gross $1,000,250.

To assist shareholders in making a decision on the proposal outlined in Resolution 4 of the Notice, (and Resolutions 5, 6, 7 and 8 relating to individual Related Parties which also form part of Resolution 4 of the Notice), the proposed directors have requested that Stantons International Securities Pty Ltd prepare an Independent Expert's Report, which must state whether, in the opinion of the Independent Expert, the proposals under Resolution 4 are fair and reasonable to the non-associated shareholders of NAV.

1.13 We are not reporting on the fairness and reasonableness of the other resolutions referred to in the Notice and Explanatory Statement, other than Resolution 4 as outlined above. However, in order to opine on the proposals under Resolution 4, we have had to consider the proposals as noted in Resolutions 1 and 2 (and 5 to 8).
1.14 Apart from this introduction, this report considers the following:
Summary of opinion
Implications of the proposals with the Consortium
Corporate history and nature of business
Future direction of NAV
Basis of valuation of NAV shares
Premium for control
Consideration as to fairness and reasonableness
Conclusion as to fairness and reasonableness
Shareholder Decisions
Sources of information
Appendix A and Financial Services Guide
1.15 In determining the fairness and reasonableness of the transactions pursuant to Resolution 4, we have had regard to the definitions set out by the Australian Securities and Investments Commission (“ASIC”) in its Regulatory Guide 111, “Content of Expert Reports”. The Regulatory Guide 111 states that an opinion as to whether an offer is fair and/or reasonable shall entail a comparison between the offer price and the value that may be attributed to the securities under offer (fairness) and an examination to determine whether there is justification for the offer price on objective grounds after reference to that value (reasonableness). The concept of “fairness” is taken to be the value of the offer price, or the

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consideration, being equal to or greater than the value of the securities in the above mentioned offer. Furthermore, this comparison should be made assuming 100% ownership of the “target” and irrespective of whether the consideration is scrip or cash. An offer is “reasonable” if it is fair.

An offer may also be reasonable, if despite not being ”fair”, there are sufficient grounds for security holders to accept the offer in the absence of any higher bid before the close of the offer. It also states that, where an acquisition of shares by way of an allotment is to be approved by shareholders pursuant to Section 611 (Item 7) of TCA, it is desirable to commission a report by an independent expert stating whether or not the proposal is fair and reasonable, having regards to the proposed allottees and whether a premium for potential control is being paid by the allottees. Regulatory Guide 111 also provides that such an allotment should involve a comparison of the advantages and disadvantages likely to accrue to non-associated shareholders if the transactions proceed compared with if they do not.

1.16 Accordingly, our report in relation to Resolution 4 comprising the approval to issue up to 225,000,000 First Placement Shares, up to 175,000,000 First Placement Options, up to 50,000,000 Second Placement Shares and up to 50,000,000 Management Options to the Syndicate or their nominees is concerned with the fairness and reasonableness of the proposal with respect to the existing non-associated shareholders of NAV and whether the Syndicate is paying a premium for control.

Summary of Opinions

1.17 For the purposes of Section 611 (item 7) of TCA, the proposals in relation to the approval to issue up to 225,000,000 First Placement Shares, up to 50,000,000 Second Placement Shares, up to 175,000,000 First Placement Options and up to 50,000,000 Management Options together the Syndicate as set out in Resolution 4 are in our opinion taking into account the factors noted elsewhere in this report including the factors (positive, negative and other factors) noted in section 7 of this report, may on balance collectively be considered to be fair and reasonable to the non-associated shareholders at the date of this report.
1.18 Each shareholder needs to examine the share price of NAV, market conditions and announcements made by NAV up to the date of the shareholders meeting at the time of exercise of vote to ascertain the impact, if any, on Resolution 4 (and all other Resolutions). The opinions expressed above must be read in conjunction with the more detailed analysis and comments made in this report.

2. Implications of the Proposals

2.1 As at 30 November 2015, there are 18,223,695 ordinary fully paid shares on issue in NAV, Post the implementation of all of the recapitalisation proposals, the maximum number of shares may be:

Number of shares on issue Issue of Shares Issue of First Placement Shares Issue of Second Placement Shares Shares on issue prior to exercise of share options Exercise of the First Placement Options Potential shares on issue prior to the exercise of the Management Options Exercise of the Management Options Potential shares on issue	18,223,695 225,000,000 150,000,000 393,223,695 175,000,000 568,223,695 50,000,000 618,223,695

Further details on the shares that could be on issue and the shareholding interests of the Syndicate and other parties are noted in the ES attached to the Notice.

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2.2 Following completion of the Subscription Agreements and the other proposals noted in paragraphs 1.1 and 1.2 above and in the Notice, the Syndicate who currently holds nil shares in NAV would own a total of up to 500,000,000 shares in NAV representing approximately 80.88% of the then shares on issue (assuming all other share are issued as envisaged and all options issued have been made and the full exercise of options completed by the option holders as described in the Notice and ES). There would be 618,223,695 NAV shares on issue.

The Company will raise $2,000,250 from the issue of First Placement Shares, Second Placement Shares and First Placement Options, (but before the exercise of First Placement Options and Management Options) of which $1,000,250 will come from the Syndicate or their nominees. Should the Syndicate receive its full allotment of First Placement Options and Management Options, and exercise all the aforementioned options, a further $2,750,000 would be raised upon exercise of these options at a future point in time from the Syndicate.

The Company seeks approval for the issue and allotment of up to 225,000,000 First Placement Shares, up to 50,000,000 Second Placement Shares and potential issue and exercise of up to 175,000,000 First Placement Options and up to 50,000,000 Management Options in the capital of the Company to the Syndicate (or via nominee entities) under the Syndicate Placement. As noted above, should the Syndicate exercise its allotment of First Placement Options and Management Options, the amount raised from the Syndicate would increase by $2,750,000 to a total amount raised of $3,750,250 (the proceeds on exercising the First Placement Options ($816,000) and the Management Options ($526,476) from the Related Parties would be $1,342,476).

2.3 We understand that the Subscription monies raised will be used for working capital, development of the existing NAV business (relating to exploration and evaluation of the Cummins Range mineral prospect more fully described in the ES attached to the Notice), payment to the Deed Administrator under the DOCA and identifying new opportunities for NAV shareholders.
2.4 The Board of NAV, should all Resolutions as part of the Notice be consummated and the DOCA be effectuated (that is post potential shareholder approval), would consist of Messer’s Greg Ruddock, Joshua McKean, Glen Dobbie and Malcolm Keefe. Further new directors may be appointed in the future as the needs arise.
2.5 As at 30 November 2015, it is believed that the number of ordinary shares on issue in NAV prior to consolidation of capital is 18,223,695. If all the Resolutions are consummated, the Syndicate will collectively own up to approximately 69.93% of the expanded (post consolidated) share capital of the Company. The actual holding of the capital of the Company, post consummation of all Resolutions put to the shareholders in the Notice by existing shareholders will be 4.63% (2.95% if all First Placement Options and Management Options are exercised). Messrs Ruddock, McKean, Dobbie and Keefe will each own approximately 7.01%, 7.01%, 17.27% and 7.39% respectively of the expanded post consolidated capital of the Company (assuming the issue and exercise of all the options).
2.6 The estimated costs of the Notice for the meeting of shareholders and other costs including corporate and advisory fees, ASX listing fees and other costs will be around $285,000. Under the Recapitalisation Proposal the Company will also pay a further $615,000 to the Creditors Trust.
2.7 Set out below is a statement of financial position of the Company based on the Administrators records as at July 2015 together with the pro-forma balance sheet (statement of financial position) if all resolutions are passed and consummated (and adjusted to exclude approximately $564,000 of creditors and amounts owing to the Deed Administrators and Administrators (net of $97,000 cash and receivables) which would have been transferred to the Creditors Trust when the Company comes out of the DOCA).

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Estimated Statement of Financial Position $ Current Assets Cash Assets (see below) - - Non Current Assets Cummins Range Asset (see paragraph 3.3 below) Not available Total Assets Not available Liabilities* Trade Creditors and Accruals 564,000 Total Current Liabilities 564,000 Net (Deficiency)/Surplus (564,000) Note 1 The movement in the cash assets is reconciled as follows: Cash Assets: Opening Balance Issue of First Placement A Shares at 0.25 cents each Issue of First Placement B Shares at 0.001 cents each Issue of Second Placement of Shares at 1 cent each Payment to the Creditors Trust Payment of recapitalisation costs Net cash on hand	Estimated Statement of Financial Position $* -	Statement of Financial Position after Resolutions passed $ 1,100,250
	-	1,100,250
	Not available	Not available
	Not available	1,100,250
	564,000	-
	564,000	-
	(564,000)	1,100,250
		- 500,000 250 1,500,000 (615,000) (285,000)
		1,100,250

Thus estimated net cash after the capital raisings and payment for costs of the Notice and other costs and the payment to the Creditors Trust will be $1,100,250 and no other material liabilities.

3. Corporate History and Nature of Business

3.1 NAV is currently suspended from its listing on the ASX and after entering into several DOCA’s in 2013 and 2014 it has sold all mineral projects except for the Cummins Project near Halls Creek in Western Australia and materially reduced its pre-administration secured creditors. The Company post recapitalisation and post DOCA will evaluate the economic viability of continuing with the Cummins Project and may seek new mineral business projects.

3.2 A summarised unaudited consolidated balance sheet (statement of financial position) of NAV post ratification of all Resolutions is outlined in paragraph 2.8 of this report.
3.3 The retention of the Company’s existing asset (unencumbered) includes the Cummins Project more fully described in the ES attached to the Notice. It is noted that the Deed Administrators have indicated in the July 2015 report to Creditors that if the recapitalisation proposal as noted above does not occur, the Company will probably be placed into liquidation and Creditors would not receive a dividend on wind up. This implies that there may be minimal current value to the Cummins Project (insufficient funds would be raised from sale of the Cummins Project to pay all Creditors) and that shareholders value pre recapitalisation is $nil. In the event that NAV fails in its recapitalisation, there is a high

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probability that it would lose its rights under the exploration licence relating to the Cummins Project as it would not be able to meet its minimum exploration expenditures as required under licensing conditions or the tenement would be plainted.

4. Future Directions of NAV

4.1 We have been advised by the proposed directors of NAV that:

The immediate short-term plan is to reapply for trading on the ASX so that the shares are freely tradable on the ASX;
To complete all the Resolutions in the Notice to raise up to $2,000,250 (not including the effect of any further funds from the exercise of First Placement Options and the exercise of Management Options) and such funds will be used for working capital, development of the existing NAV business (evaluate the Cummins Project), payment to the Deed Administrators and Creditors under the DOCA and identifying new opportunities for NAV shareholders;
Composition of the Board of directors of NAV may change in the near future as outlined in paragraph 2.4;
No dividend policy has been set and it is not proposed to be set until such time as the Company is profitable and has a positive cash flow; and
The Company may seek to raise further capital if required but no further capital raisings are expected in the first half 2016 (other than the up to $2,000,250 monies raised in the last quarter of calendar 2015 as noted in this report).

5. Basis of Valuation of NAV

5.1 Shares

5.1.1 In considering the proposals as outlined in Resolution 4, we have sought to determine whether the issue price of the Syndicate Subscription Shares to the Syndicate (or their nominees) is in excess of the current fair value of the shares in NAV on issue and then conclude whether the proposal is fair and reasonable to the existing non associated shareholders of NAV.
5.1.2 The valuation methodologies we have considered in determining a theoretical value of a NAV share are:
capitalised maintainable earnings/discounted cash flow;
takeover bid - the price at which an alternative acquirer might be willing to offer;
adjusted net asset backing and windup value; and
the recent market prices of NAV shares.

5.2 Capitalised maintainable earnings and discounted cash flows

5.2.1 NAV currently does not have a reliable cash flow or profit history from a business undertaking and therefore this methodology is not considered to be appropriate, particularly given the fact that the Company entered into voluntary administration in May 2013.

5.3 Takeover Bid

5.3.1 It is possible that a potential bidder for NAV could purchase all or part of the existing shares, however no certainty can be attached to this occurrence. Currently the Company is in voluntary administration, and the Company has undertaken a variation to the Deed of Company Arrangement with the Syndicate led by Otsana Capital and Auxano LLP for the Company to emerge from administration. To our knowledge, there was no rival bid to recapitalise the Company. However, if all of the First Placement Shares and Second Placement Shares are issued and the First Placement Options and Management Options

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are issued and exercised, the Syndicate (either individually or via nominees) would control approximately 80.88% of the expanded ordinary issued capital of NAV, but before any other further share issues as referred to in this report and the Notice and ES.

5.4 Adjusted Net Asset Backing

5.4.1 Net asset backing and windup value
5.4.1 As noted above prior to the recapitalisation process, NAV has no cash, or other assets (apart from an interest in the Cummins Project) with no ascribed value. The Deed Administrators consider that on a windup basis, the return to shareholders would be nil (refer paragraph 3.3 of this report).
5.4.2 Purely based on the net cash value of a recapitalised NAV, the net assets would be disclosed at approximately $1,100,250 (assuming the Company raises $2,000,250 as noted above) which would be equivalent to approximately 0.28 per share, assuming 393,223,695 shares would be on issue after the recapitalisation process (but before the exercise of First Placement Options and the exercise of Management Options). This compares with the estimated current net value of an NAV share of nil cents. Should the existing First Placement Options be exercised to raise a further $1,750,000 as well as the Management Options be exercised, a further $1,000,000 be raised and the total number of shares on issue would increase to 618,223,695 shares on issue or approximately 0.62 cents per share (assuming no further shares are issued and ignoring any post recapitalisation losses).

5.5 Market price of NAV shares

5.5.1 As the Company is suspended from the ASX, we do not believe it is appropriate to value the NAV share based on prior quoted prices of NAV shares on the ASX.

Summary conclusion on value of a share in NAV

5.6 After taking into account the matters referred to in the preceding paragraphs, we are of the view that the current theoretical value of an NAV share (prior to the recapitalisation process) is nil cents. As disclosed above the Company has no material assets with minimal business activities, however it still retains the Cummins Project (that will need to incur certain exploration costs in order to retain such project). If the minimum expenditure is not spent (as required under the exploration licence conditions), the Cummins Project may be subject to forfeiture.
5.7 If the recapitalisation process is finalised, the net value of an NAV share immediately post recapitalisation would approximate 0.28 cents per share (assuming the $2,000,250 is raised as noted in the Resolutions in the Notice, but before the exercise of First Placement Options and the exercise of Management Options).

6. Premium for Control

6.1 Premium for control for the purposes of this report has been defined as the difference between the price per share that a buyer would be prepared to pay to obtain a controlling interest in the Company and the price per share at which the same person would be required to pay per share which does not carry with it control of the Company.
6.2 Under TCA, control may be deemed to occur when a shareholder or group of associated shareholders’ control more than 20% of the issued capital. In this case, the Syndicate could hold approximately 69.93% of the expanded issued capital of NAV (the Related Parties, Messer’s Ruddock, McKean, Dobbie and Keefe would individually own 6.36%, 6.36%, 14.30% and 6.36% of the Company respectively). In take-over offers, it is often the case that a premium for control falls in the normal range of 15% to 40% and it is often accepted that a 20% premium for control should be payable. The actual premium may be more or less. In this case, we assume a reasonable premium for control should be 20%.

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6.3 The NAV shares that are proposed to be issued to the Syndicate (the subject of Resolution 4), are deemed to be theoretically worth nil cents. Before certain transaction costs (assuming to amount to $285,000), a net cash balance of approximately $1,100,250 will remain in the Company (assuming the raising of the $2,000,250 referred to above).

In our opinion, it is possible that the Syndicate are paying a premium for control, however, the non associated shareholders of NAV are benefiting in that the theoretical value of an NAV share rises from nil cents to a company with theoretical cash backed value of approximately 0.28 cents per share.

If the recapitalisation proposal is completed the Company may be in a position to seek new funds and new businesses in the future and depending on whether it is required to comply with Chapters 1 and 2 of the ASX Listing Rules may seek re-quotation of the Company’s shares on the ASX. No major fund raising or new business acquisitions have yet been identified.

6.4 Our preferred methodology is to value NAV and an NAV share on a technical net asset basis which assumes a 100% interest in the Company. Therefore no adjustment is considered necessary to the technical asset value determined under paragraph 5.4.2 as this already represents the fair value of the Company or a share in the Company on a pre Proposed Transaction control basis.
6.5 We set out below the comparison of the value of an NAV share compared to the issue price for the Subscription Shares.

Para. Estimated fair value of an NAV Share 5.6 Issue price of the First and Second Placement Shares (average rate) Excess between Subscription Price and fair value	Book Value (cents) 0.00 0.50
	0.50

The 0.50 cents is a blended rate of the issue of 200,000,000 First Placement A Shares at 0.25 cents each, 25,000,000 First Placement B Shares at 0.001 cents each and 150,000,000 Second Placement Shares at 1.0 cents each.

6.6 On a pre Proposed Transaction control basis, the value of an NAV share is nil cents per share. The recapitalisation is expected to raise $2,000,250 post consummation of all Resolutions. Based on the preferred value of nil cents per share, a premium for control is being paid by the Syndicate.
6.7 We note that the Syndicate does not have Board control of NAV, and has a nil interest in NAV at the date of this report.

7. Fairness of the Proposals

7.1 The concept of “fairness” is to be taken to be the value of the offer price, or the consideration being equal to or greater than the value of the securities in the above mentioned offer. As noted above the NAV shares that are proposed to be issued to the Syndicate, (the subject of Resolution 4) are deemed to be theoretically worth nil cents. Assuming a 20% premium for control, the deemed theoretical value is still nil.
7.2 If the recapitalisation proposal is completed, the theoretical value of an NAV share increases to approximately 0.28 cents before the potential exercise of any options. The theoretical value of a NAV share post recapitalisation from a non associated shareholder’s perspective, based on the estimated net assets of $1,100,250 is 0.28 cents (prior to the

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potential exercise of any options) which is in excess of the theoretical value pre recapitalisation of nil cents per share. Based on a fully diluted basis (after the exercise of the 175,000,000 First Placement Options at 1 cent each and the 50,000,000 Management Options to the Syndicate at 2 cents each), the potential cash on hand increases by $2,750,000, the net assets increase to $3,850,250 (ignored post recapitalisation losses and ascribing no value to the Cummins project, if still retained), and the theoretical value of a NAV share increases from nil to 0.62 cents based on the potential shares on issue of 618,223,695 shares. The theoretical value of a NAV share post recapitalisation from a non associated shareholder’s perspective on a fully diluted basis, based on the estimated net assets of $1,100,250 is 0.28 cents which is in excess of the theoretical value pre recapitalisation of nil cents per share.

7.3 In arriving at our conclusion on fairness, we considered whether the transaction is “fair” by comparing:
(a) the fair market value of an NAV share pre-transaction on a control basis; versus (b) the fair market value of an NAV share post-transaction on a minority basis, taking into account the additional cash raised and the associated dilution resulting from the issue of new shares under the transaction.
7.4 The value of an NAV share pre the Proposed Transactions on a control basis is:

	Para.	Book Value
		(cents)
Estimated fair value of
an NAV Share	5.6	nil

7.5 The preferred fair market value of a NAV share has been estimated at nil cents on a pre Proposed Transaction control basis. The Syndicate Subscription yields to an adjusted value of 0.233 cents per NAV share (refer below). As the preferred fair market value of an NAV share is greater on a post transaction basis, the proposed Syndicate Subscription is considered to be fair to the non associated shareholders.
7.6 We set out below the range of estimated technical net asset values of NAV based on the Pro-forma Balance Sheet as detailed in paragraph 2.8 (after adjusting for the following transactions):

Issue of First Placement A Shares at 0.25 cents each
Issue of First Tranche B Placement Shares at 0.001
cents each
Issue of Second Placement of Shares at 1 cent each
Payment to Creditors Trust
Payment of recapitalisation costs
NAV Business Asset (see paragraph 3.3
above)
Cash (after paying $615,000 to Creditors Trust
and recapitalisation costs
Total net assets
Number of shares on issue
Net
asset
value
per
share
(cents)
Minority interest discount
Minority value per share (cents)
Issue Price (Blended Rate) (see
paragraph 6.5 above) (cents)

$500,000
250
$1,500,000
$(615,000)
$(285,000)
No
Ascribed
value
1,100,250
1,100,250
393,223,695
0.28
16.67%
0.233
0.50

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7.7 In order to reflect the minority interest value we have applied a minority interest discount to the technical net asset value. The minority interest discount has been calculated as the inverse of the premium for control of 20% as discussed in paragraph 6.2.
7.8 As noted above the fair market value of an NAV share Post-Transaction on a minority basis, taking into account the additional cash raised and the associated dilution resulting from the issue of new shares under the transaction has a preferred fair value of approximately 0.233 cents.
7.9 We set out below a comparison of:
(a) the fair market value of an NAV share pre-transaction on a control basis; versus (b) the fair market value of an NAV share post-transaction on a minority basis, taking into account the additional cash raised and the associated dilution resulting from the issue of new shares under the transaction.

Para. Estimated fair value of a NAV Share Pre Transaction on a control basis 5.6 Estimated fair value of a NAV Share Post Transaction on a minority basis 7.6 Excess/(shortfall) between Pre transaction Price and Post transaction Price	Value (cents) nil 0.233
	0.233

Using the preferred net asset fair values, the estimated fair value of a NAV share Pre Transaction on a control basis is less than the estimated fair value of a NAV share Post Transaction on a minority basis and on this basis the Syndicate Subscription is considered fair to the non associated shareholders of NAV.

We have ignored the dilution effect of the exercise of the planned First Placement Options and the Management Options. Both classes of share options are unlikely to be exercised until the shares in NAV consistently trade on ASX at above 1 cent each for the First Placement Options and 2 cents for the Management Options. In any event, if exercised and ignoring all other transactions, the minority value per share on a fully diluted basis would increase.

7.10 Conclusion as to fairness

After taking into account the matters referred to in 7 above and elsewhere in this report, we are of the opinion that the proposals as outlined in Resolution 4 are on balance fair to the non-associated shareholders of NAV as at the date of this report.

8. Reasonableness of the Proposals

Advantages

8.1 The passing and consummation of Resolution 4 (and collectively Resolutions 1 to 9) in conjunction with the completion of the recapitalisation process would result in a net cash injection of approximately $1,100,250 (assuming the capital raising of the $2,000,250 referred to above and payment of $285,000 in expenses and $615,000 to the Creditor’s Trust) into the Company and having a company with minimal or no liabilities, compared with the current position whereby the Company has net assets of approximately $nil.
8.2 If the proposals per Resolution 4 (and collectively Resolutions 1 to 9) are consummated along with the completion of the recapitalisation process, the net cash asset backing of an

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NAV share rises from nil cents to approximately 0.28 cents (assumes $2,000,250 worth of shares are issued).

8.3 If Resolution 4 (and collectively Resolutions 1 to 9) are passed together with the completion of the recapitalisation process (and other Resolutions not reported upon in this Report), the Company’s chances to seek re-quotation of its shares on the ASX are enhanced in that without the recapitalisation, it is likely that the Company would be dissolved and struck off. By obtaining re-quotation of the Company’s shares, the existing shareholders are offered liquidity to sell their shares on the ASX.

If the Company went into liquidation (the Deed Administrators consider this likely in the absence of the Restructure as envisaged or some other favourable recapitalisation proposal), the Company would lose the Cummins Project that in the long term may lead to a successful mineral project. The Deed Administrators consider that in the absence of the Restructure, the Creditors would receive nil return and thus implying that shareholders value pre Restructure is nil.

8.4 The proposed directors bring expertise to the Company in that Messer’s Ruddock, McKean, Dobbie and Keefe have either financial, accounting, marketing and corporate experience and/or experience as directors or managers of public listed companies or other trading entities. The ES discloses the background of the proposed directors.

Disadvantages

8.5 A significant shareholding in the Company is being given to the Syndicate, and in particular the Related Parties and the other members of the Syndicate in general combined would own approximately 80.88% of the expanded issued capital of the Company. However, we note that NAV will be partly recapitalised with approximately $1,100,250 in net cash (assuming the $2,000,250 capital raising and payment of $285,000 in recapitalisation costs and $615,000 to the Creditor’s Trust), will have no debt and will have the opportunity to evaluate the Cummins Range Project and consider the acquisition of other assets or businesses. The existing shareholders are diluted to approximately 4.63%. It is assumed that all Syndicate investors will obtain a benefit particularly if the Company’s shares can be re-quoted on ASX.
8.6 NAV would only have approximately net cash of $1,100,250 (assuming the raising of $2,000,250 as noted above and payment of $285,000 of recapitalisation costs and $615,000 to the Creditors Trust) after the consummation of the recapitalisation process is complete. Further fundraisings may be required to be undertaken in the future. If further shares are issued, the percentage shareholding of the existing shareholders of NAV may be diluted down even further. However as noted above, the shares in NAV prior to the recapitalisation process is considered to be of nil value, with the possibility of the Company being placed into liquidation.
8.7 If the Company seeks new business opportunities, there is no guarantee that such businesses will be profitable. Refer to the Letter to Shareholders accompanying the Notice on the proposed expenditure post the recapitalisation process.

Other

8.8 The 175,000,000 First Placement Options, if exercised, would result in a further inflow of funds to NAV of $1,750,000. The exercise price of the 175,000,000 First Placement Options is 1 cent each. The trading price of a NAV share (after re-quotation of the Company’s shares on the ASX that is dependent upon completion of the recapitalisation process) at the date of exercise of the share options could be in excess of 1 cent before option holders exercised such share options.
8.9 The 175,000,000 First Placement Options to be issued for nil consideration have been valued using the Black Scholes option valuation methodology with the key assumptions of an exercise price of 1.0 cents, a share price of 1.0 cents, an interest rate of 1.94%, a term

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of 3 years and a volatility factor of 75%. The value ascribed is 0.44 cents per share option (before discount) for a total value of approximately $770,000 but against which a discount of 25% is applied for the unlisted status of the options to an adjusted value of $577,500. If all exercised, the Company would receive $1,750,000.

8.10 The 50,000,000 Management Options to be issued for a total of nil consideration have been valued using the Black Scholes option valuation methodology with the key assumptions of an exercise price of 2.0 cents, a share price of 1.0 cents, an interest rate of 1.94%, a term of 4 years and a volatility factor of 75%. The value ascribed is 1.25 cents per share option (before discount) for a total value of approximately $625,000 but against which a discount of 25% is applied for the unlisted status of the options to an adjusted value of $468,750. if all exercised, the Company would receive $1,000,000.

9. Conclusion as to Reasonableness

9.1 After taking into account the matters referred to in 8 above and elsewhere in this report, we are of the opinion that the proposals as outlined in Resolution 4 are on balance reasonable to the non-associated shareholders of NAV as at the date of this report.

10. Shareholder Decision

10.1 Stantons International Securities Pty Ltd has been engaged to prepare an independent expert’s report setting out whether in its opinion the proposals outline in Resolution 4 are fair and reasonable and state reasons for that opinion. Stantons International Securities Pty Ltd has not been engaged to provide a recommendation to shareholders in relation to the proposals under Resolution 4 (and all other Resolutions) but we have been requested to determine whether the proposals pursuant to Resolution 4 are fair and/or reasonable to those shareholders not associated with the Syndicate. The responsibility for such a voting recommendation lies with the proposed directors of NAV.
10.2 In any event, the decision whether to accept or reject Resolution 4 (and all other Resolutions) is a matter for individual shareholders based on each shareholder’s views as to value, their expectations about future market conditions and their particular circumstances, including risk profile, liquidity preference, investment strategy, portfolio structure and tax position.

If in any doubt as to the action they should take in relation to the proposals under Resolution 4 (and all other Resolutions), shareholders should consult their own professional adviser.

10.3 Similarly, it is a matter for individual shareholders as to whether to buy, hold or sell shares in NAV. This is an investment decision upon which Stantons International Securities Pty Ltd does not offer an opinion and is independent on whether to accept the proposals under Resolution 4 (and all other Resolutions). Shareholders should consult their own professional adviser in this regard.

11. Sources of Information

11.1 In making our assessment as to whether the proposals pursuant to Resolutions 4 are fair and reasonable, we have reviewed relevant published available information and other unpublished information of NAV which is relevant in the current circumstances. In addition, we have held discussions with a proposed director of NAV and a party associated with the Syndicate about the present state of affairs of NAV. Statements and opinions contained in this report are given in good faith, but in the preparation of this report, we have relied in part on information provided by the proposed director and the representative of the Syndicate and publicly filed information on the financial position of the Company lodged via the ASX website.

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11.2 Information we have received includes, but is not limited to:
drafts of the September 2015 to 26 November 2015 Notice of General Meeting of Shareholders of NAV (and drafts of the ES attached);
discussions with a proposed director and a representative of the Syndicate;
shareholding details of NAV;
announcements, if any, made by NAV to the ASX to 29 November 2015;
the reports to Creditors by the Administrators and/or Deed Administrators in 2013, 2014 and 2015; and
the DOCA of September 2015.
11.3 Our report includes Appendix A and Financial Services Guide, attached to this report.

Yours faithfully

STANTONS INTERNATIONAL SECURITIES PTY LTD (Trading as Stantons International Securities)

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John Van Dieren- FCA Director

APPENDIX A

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AUTHOR INDEPENDENCE

This annexure forms part of and should be read in conjunction with the report of Stantons International Securities Pty Ltd trading as Stantons International Securities Pty Ltd dated 30 November 2015, relating to Resolution 4 outlined in the Notice of Meeting of Shareholders and the accompanying ES to be distributed to shareholders of NAV in or around December 2015.

At the date of this report, Stantons International Securities Pty Ltd does not have any interest in the outcome of the proposals. There are no relationships with NAV other than acting as an independent expert for the purposes of this report. There are no existing relationships between Stantons International Securities Pty Ltd and the parties participating in the transactions detailed in this report which would affect our ability to provide an independent opinion. The fee to be received for the preparation of this report is based on the time spent at normal professional rates plus out of pocket expenses and is estimated not to exceed $10,000 (excluding GST). The fee is payable regardless of the outcome. With the exception of that fee, neither Stantons International Securities Pty Ltd nor John P Van Dieren or Martin Michalik have received nor will or may they receive any pecuniary or other benefits, whether directly or indirectly for or in connection with the making of this report. Stantons International Securities Pty Ltd and Stantons International Audit and Consulting Pty Ltd or any directors of Stantons International Securities Pty Ltd and Stantons International Audit and Consulting Pty Ltd do not hold any securities in NAV. There are no pecuniary or other interests of Stantons International Securities Pty Ltd that could be reasonably argued as affecting its ability to give an unbiased and independent opinion in relation to the proposal. Stantons International Securities Pty Ltd, John Van Dieren and Martin Michalik have consented to the inclusion of this report in the form and context in which it is included as an annexure to the Notice. Stantons International Securities has prepared other independent expert reports for parties associated with Otsana.

QUALIFICATIONS

We advise Stantons International Securities Pty Ltd is the holder of an Investment Advisers Licence (No 448697) under the Corporations Act relating to advice and reporting on mergers, takeovers and acquisitions involving securities. A number of the directors of Stantons International Audit and Consulting Pty Ltd are the directors and authorised representatives of Stantons International Securities Pty Ltd. Stantons International Securities Pty Ltd and Stantons International Audit and Consulting Pty Ltd (trading as Stantons International) have extensive experience in providing advice pertaining to mergers, acquisitions and strategic and financial planning for both listed and unlisted companies and businesses.

Mr John Van Dieren (FCA) and Mr Martin Michalik the persons responsible for the preparation of this report, has extensive experience in the preparation of valuations for companies and in advising corporations on takeovers generally and in particular on the valuations and financial aspects thereof, including the fairness and reasonableness of the consideration offered. The professionals employed in the research, analysis and evaluation leading to the formulation of opinions contained in this report, have qualifications and experience appropriate to the tasks they have performed.

DECLARATION

This report has been prepared at the request of the proposed Directors and the Syndicate in order to assist the shareholders of NAV to assess the merits of the proposals (Resolution 4) to which this report relates. This report has been prepared for the benefit of the NAV shareholders and those persons only who are entitled to receive a copy for the purposes of Section 611 (Item 7) of the Corporations Act 2001 and does not provide a general expression of Stantons International Securities Pty Ltd’s opinion as to the longer term value of NAV. Stantons International Securities Pty Ltd does not imply, and it should not be construed, that it has carried out any form of audit on the accounting or other records of NAV or any of its subsidiaries. Neither the whole, nor any part of this report, nor any reference thereto may be included in or with or attached to any document, circular, resolution, letter or statement, without the prior written consent of Stantons International Securities Pty Ltd to the form and context in which it appears.

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DUE CARE AND DILEGENCE

This report has been prepared by Stantons International Securities Pty Ltd with due care and diligence. The report is to assist shareholders in determining the fairness and reasonableness of the proposal set out in Resolutions 4 to the Notice and each individual shareholder may make up their own opinion as to whether to vote for or against Resolution 4 (and all other Resolutions).

DECLARATION AND INDEMNITY

Recognising that Stantons International Securities Pty Ltd may rely on information provided by the Syndicate (represented by Otsana and Auxano, their officers and other parties (save whether it would not be reasonable to rely on the information having regard to Stantons International Securities Pty Ltd experience and qualifications), the Syndicate has agreed:

(a) to make no claim by it or its officers against Stantons International Securities Pty Ltd (and Stantons International Audit and Consulting Pty Ltd) to recover any loss or damage which NAV may suffer as a result of reasonable reliance by Stantons International Securities on the information provided by the Syndicate and NAV’s Deed Administrators; and
(b) to indemnify Stantons International Securities Pty Ltd (and Stantons International Audit and Consulting Pty Ltd) against any claim arising (wholly or in part) from the Syndicate (as represented by Otsana and Auxano or any of its officers) and NAV providing Stantons International Securities Pty Ltd any false or misleading information or in the failure of the Syndicate, NAV and their officers (as represented by Otsana and Auxano) in providing material information, except where the claim has arisen as a result of wilful misconduct or negligence by Stantons International Securities Pty Ltd.

A draft of this report was presented to the proposed Directors and the Syndicate (as represented by Otsana and Auxano) for a review of factual information contained in the report. Comments received relating to factual matters were taken into account, however the valuation methodologies and conclusions did not alter.

PO Box 1908 West Perth WA 6872 Australia

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Level 2, 1 Walker Avenue West Perth WA 6005 Australia

Tel: +61 8 9481 3188 Fax: +61 8 9321 1204

FINANCIAL SERVICES GUIDE FOR STANTONS INTERNATIONAL SECURITIES PTY LTD (Trading as Stantons International Securities) Dated 30 November 2015

ABN: 42 128 908 289 AFS Licence No: 448697 www.stantons.com.au

Stantons International Securities Pty Ltd (ABN 42 128 908 289 and AFSL Licence No 448697) (“SIS” or “we” or “us” or “ours” as appropriate) has been engaged to issue general financial product advice in the form of a report to be provided to you.

2. Financial Services Guide

In the above circumstances we are required to issue to you, as a retail client a Financial Services Guide (“FSG”). This FSG is designed to help retail clients make a decision as to their use of the general financial product advice and to ensure that we comply with our obligations as financial services licensees.

This FSG includes information about:

who we are and how we can be contacted;
� the services we are authorised to provide under our Australian Financial Services Licence, Licence No: 448697;
remuneration that we and/or our staff and any associated entities receive in connection with the general financial product advice;
any relevant associations or relationships we have; and
our complaints handling procedures and how you may access them.

3. Financial services we are licensed to provide

We hold an Australian Financial Services Licence which authorises us to provide financial product advice in relation to:

Securities (such as shares, options and notes)

We provide financial product advice by virtue of an engagement to issue a report in connection with a financial product of another person. Our report will include a description of the circumstances of our engagement and identify the person who has engaged us. You will not have engaged us directly but will be provided with a copy of the report as a retail client because of your connection to the matters in respect of which we have been engaged to report.

Any report we provide is provided on our own behalf as a financial services licensee authorised to provide the financial product advice contained in the report.

General Financial Product Advice

In our report we provide general financial product advice, not personal financial product advice, because it has been prepared without taking into account your personal objectives, financial situation or needs. You should consider the appropriateness of this general advice having regard to your own objectives, financial situation and needs before you act on the advice. Where the advice relates to the acquisition or possible acquisition of a financial product, you should also obtain a product disclosure statement relating to the product and consider that statement before making any decision about whether to acquire the product.

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Liability limited by a scheme approved under Professional Standards Legislation

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Benefits that we may receive

We charge fees for providing reports. These fees will be agreed with, and paid by, the person who engages us to provide the report. Fees will be agreed on either a fixed fee or time cost basis.

Except for the fees referred to above, neither SIS, nor any of its directors, employees or related entities, receive any pecuniary benefit or other benefit, directly or indirectly, for or in connection with the provision of the report.

Remuneration or other benefits received by our employees

SIS has no employees and Stantons International Audit and Consulting Pty Ltd charges a fee to SIS. All Stantons International Audit and Consulting Pty Ltd employees receive a salary. Stantons International Audit and Consulting Pty Ltd employees are eligible for bonuses based on overall productivity but not directly in connection with any engagement for the provision of a report.

7. Referrals

We do not pay commissions or provide any other benefits to any person for referring customers to us in connection with the reports that we are licensed to provide.

8. Associations and relationships

SIS is ultimately a wholly owned subsidiary of Stantons International Audit and Consulting Pty Ltd a professional advisory and accounting practice. From time to time, SIS and Stantons International Audit and Consulting Pty Ltd (trading as Stantons International) and/or their related entities may provide professional services, including audit, accounting and financial advisory services, to financial product issuers in the ordinary course of its business.

9. Complaints resolution

9.1 Internal complaints resolution process

As the holder of an Australian Financial Services Licence, we are required to have a system for handling complaints from persons to whom we provide financial product advice. All complaints must be in writing, addressed to:

The Complaints Officer Stantons International Securities Pty Ltd Level 2 1 Walker Avenue WEST PERTH WA 6005

Telephone: 08 9481 3188 Facsimile: 09 9321 1204

When we receive a written complaint we will record the complaint, acknowledge receipt of the complaints within 15 days and investigate the issues raised. As soon as practical, and not more than 45 days after receiving the written complaint, we will advise the complainant in writing of our determination.

9.2 Referral to External Dispute Resolution Scheme

A complainant not satisfied with the outcome of the above process, or our determination, has the right to refer the matter to the Financial Ombudsman Service Limited (“FOSL”). FOSL is an independent company that has been established to provide free advice and assistance to consumers to help in resolving complaints relating to the financial services industry.

ANNEXURE'B'–'DILUTIONARY'EFFECT'OF'ISSUE'OF'RELATED'PARTY'SECURITIES'

Holder Issuedsharesas atthedateofthis NoticeofMeeting FirstPlacement sharestobe issued Second Placement Sharestobe issued TotalShares Issued Dilutionaryeffect uponissueof FirstandSecond Placement Shares (undiluted) 1 Firstplacement optionstobe issued Management Optionstobe issued IssuedShares uponissueof FirstandSecond Placement Securities(fully diluted) DilutionaryEffect uponissueof FirstandSecond Placement Securities 2	Holder Issuedsharesas atthedateofthis NoticeofMeeting FirstPlacement sharestobe issued Second Placement Sharestobe issued TotalShares Issued Dilutionaryeffect uponissueof FirstandSecond Placement Shares (undiluted) 1 Firstplacement optionstobe issued Management Optionstobe issued IssuedShares uponissueof FirstandSecond Placement Securities(fully diluted) DilutionaryEffect uponissueof FirstandSecond Placement Securities 2	Holder Issuedsharesas atthedateofthis NoticeofMeeting FirstPlacement sharestobe issued Second Placement Sharestobe issued TotalShares Issued Dilutionaryeffect uponissueof FirstandSecond Placement Shares (undiluted) 1 Firstplacement optionstobe issued Management Optionstobe issued IssuedShares uponissueof FirstandSecond Placement Securities(fully diluted) DilutionaryEffect uponissueof FirstandSecond Placement Securities 2	Holder Issuedsharesas atthedateofthis NoticeofMeeting FirstPlacement sharestobe issued Second Placement Sharestobe issued TotalShares Issued Dilutionaryeffect uponissueof FirstandSecond Placement Shares (undiluted) 1 Firstplacement optionstobe issued Management Optionstobe issued IssuedShares uponissueof FirstandSecond Placement Securities(fully diluted) DilutionaryEffect uponissueof FirstandSecond Placement Securities 2	Holder Issuedsharesas atthedateofthis NoticeofMeeting FirstPlacement sharestobe issued Second Placement Sharestobe issued TotalShares Issued Dilutionaryeffect uponissueof FirstandSecond Placement Shares (undiluted) 1 Firstplacement optionstobe issued Management Optionstobe issued IssuedShares uponissueof FirstandSecond Placement Securities(fully diluted) DilutionaryEffect uponissueof FirstandSecond Placement Securities 2	Holder Issuedsharesas atthedateofthis NoticeofMeeting FirstPlacement sharestobe issued Second Placement Sharestobe issued TotalShares Issued Dilutionaryeffect uponissueof FirstandSecond Placement Shares (undiluted) 1 Firstplacement optionstobe issued Management Optionstobe issued IssuedShares uponissueof FirstandSecond Placement Securities(fully diluted) DilutionaryEffect uponissueof FirstandSecond Placement Securities 2	Holder Issuedsharesas atthedateofthis NoticeofMeeting FirstPlacement sharestobe issued Second Placement Sharestobe issued TotalShares Issued Dilutionaryeffect uponissueof FirstandSecond Placement Shares (undiluted) 1 Firstplacement optionstobe issued Management Optionstobe issued IssuedShares uponissueof FirstandSecond Placement Securities(fully diluted) DilutionaryEffect uponissueof FirstandSecond Placement Securities 2	Holder Issuedsharesas atthedateofthis NoticeofMeeting FirstPlacement sharestobe issued Second Placement Sharestobe issued TotalShares Issued Dilutionaryeffect uponissueof FirstandSecond Placement Shares (undiluted) 1 Firstplacement optionstobe issued Management Optionstobe issued IssuedShares uponissueof FirstandSecond Placement Securities(fully diluted) DilutionaryEffect uponissueof FirstandSecond Placement Securities 2	Holder Issuedsharesas atthedateofthis NoticeofMeeting FirstPlacement sharestobe issued Second Placement Sharestobe issued TotalShares Issued Dilutionaryeffect uponissueof FirstandSecond Placement Shares (undiluted) 1 Firstplacement optionstobe issued Management Optionstobe issued IssuedShares uponissueof FirstandSecond Placement Securities(fully diluted) DilutionaryEffect uponissueof FirstandSecond Placement Securities 2	Holder Issuedsharesas atthedateofthis NoticeofMeeting FirstPlacement sharestobe issued Second Placement Sharestobe issued TotalShares Issued Dilutionaryeffect uponissueof FirstandSecond Placement Shares (undiluted) 1 Firstplacement optionstobe issued Management Optionstobe issued IssuedShares uponissueof FirstandSecond Placement Securities(fully diluted) DilutionaryEffect uponissueof FirstandSecond Placement Securities 2
Syndicate (RelatedParties)
MrDobbie ) 45,000,000 11,250,000 56,250,000 14.30% 36,600,000 13,942,856 106,792,856 17.27%
MrKeefe ) 20,000,000 5,000,000 25,000,000 6.36% 15,000,000 5,714,286 45,714,286 7.39%
MrRuddock ) 20,000,000 5,000,000 25,000,000 6.36% 15,000,000 3,333,333 43,333,333 7.01%
MrMcKean ) 20,000,000 5,000,000 25,000,000 6.36% 15,000,000 3,333,333 43,333,333 7.01%

RelatedParties Total 105,000,000 26,250,000 131,250,000 33.38% 81,600,000 26,323,808 239,173,808 38.69%

Syndicate(nonM relatedparties)
NonRelated Parties ) 120,000,000 23,750,000 143,750,000 36.56% 93,400,000 23,676,192 260,826,192 42.19%

SyndicateTotal 225,000,000 50,000,000 275,000,000 69.94% 250,825,000 74,123,808 500,000,000 80.88%

Publicofferunder secondplacement ) ) 100,000,000 100,000,000 25.43% ) ) 100,000,000 16.17%
Existing Shareholders 18,223,695 18,223,695 4.63% 18,223,695 2.95%
FINALTOTAL	18,223,695	225,000,000	175,000,000	393,223,695	100.00%	175,000,000	50,000,000	618,223,695	100.00%

Notes: 1! Assumes!that!all!First!and!Second!Placement!Shares!are!issued.!

2! Assumes!a!total!of!393,223,695!shares!are!on!issued!(including!First!and!Second!Placement!Shares,!all!170,000,000!First!Placement!Options!and!50,000,000!Management!Options!are!exercised,!resulting!in!a!total! issued!Share!Capital!of!618,223,695!Shares.!The!aggregate!dilutionary!effect!of!the!issue!of!the!Related!Party!Securities!is!38.69%!on!the!basis!that!each!proposed!Director!is!deemed!to!hold!a!relevant!interest!in! each!other!proposed!Director’s!Related!Party!Securities!!

ANNEXURE'C'–'TERMS'OF'FIRST'PLACEMENT'OPTIONS'

1.# Each#Option#gives#the#Optionholder#the#right#to#subscribe#for#1#Share#for#every#Option# they#own#in#the#Company.#To#obtain#the#right#given#by#each#Option,#the#Optionholder# must#exercise#the#Options#in#accordance#with#these#terms#and#conditions.##
2.# The#Options#will#expire#at#5:00pm#(AEST)#on#the#date#3#years#from#issue#( Expiry'Date ).# Any#Option#not#exercised#before#the#Expiry#Date#will#automatically#lapse#on#the#Expiry# Date.#
3.# The#amount#payable#upon#the#exercise#of#each#Option#will#be#1#cent#($0.01)#( Exercise' Price ).#
4.# The#Options#may#be#exercised#in#whole#or#in#part,#and#if#exercised#in#part,#multiples#of# 100,000#must#be#exercised#on#each#occasion.#
5.# Optionholders# may# exercise# their# Options# by# lodging# with# the# Company,# before# the# Expiry#Date:#
(a)# a#written#notice#of#exercise#of#Options#specifying#the#number#of#Options#being# exercisedK#and#
(b)# a# cheque# or# electronic# funds# transfer# for# the# Exercise# Price# for# the# number# of# Options#being#exercised.#

( Exercise'Notice )#

6.# An#Exercise#Notice#is#only#effective#when#the#Company#has#received#the#full#amount#of# the#Exercise#Price#in#cleared#funds.#
7.# Within#10#Business#Days#of#receipt#of#the#Exercise#Notice#accompanied#by#the#Exercise# Price,#the#Company#will#allot#the#number#of#Shares#required#under#these#terms#and# conditions#in#respect#of#the#number#of#Options#specified#in#the#Exercise#Notice.#
8.# The#Options#are#freely#transferrable.#
9.# All#Shares#allotted#upon#the#exercise#of#Options#will#upon#allotment#rank#pari#passu#in# all#respects#with#other#Shares.#
10.# The#Company#will#not#apply#for#quotation#of#the#Options#on#ASX.#However,#the#Company# will#apply#for#quotation#of#all#Shares#allotted#pursuant#to#the#exercise#of#the#Options#on# ASX#immediately#after#the#allotment#of#those#Shares.#
11.# If# at# any# time# the# issued# capital# of# the# Company# is# reconstructed,# all# rights# of# the# Optionholder#are#to#be#changed#in#a#manner#consistent#with#the#Corporations#Act#and# the#ASX#Listing#Rules#at#the#time#of#the#reconstruction.#
12.# There# are# no# participating# rights# or# entitlements# inherent# in# the# Options# and# the# Optionholder# will# not# be# entitled# to# participate# in# new# issues# of# capital# offered# to# Shareholders#during#the#currency#of#the#Options.#However,#the#Company#will#ensure# that#for#the#purposes#of#determining#entitlements#to#any#such#issue,#the#record#date#will# be#at#least#6#Business#Days#after#the#issue#is#announced.#This#will#give#the#Optionholder# the#opportunity#to#exercise#the#Options#prior#to#the#date#for#determining#entitlements#to# participate#in#any#such#issue.#

13.# In#the#event#the#Company#proceeds#with#a#pro#rata#issue#(except#a#bonus#issue)#of# securities#to#Shareholders#after#the#date#of#issue#of#the#Options,#the#exercise#price#of# the#Options#may#be#reduced#in#accordance#with#the#formula#set#out#in#ASX#Listing#Rule# 6.22.2.#
14.# In#the#event#the#Company#proceeds#with#a#bonus#issue#of#securities#to#Shareholders# after#the#date#of#issue#of#the#Options,#the#number#of#securities#over#which#an#Option#is# exercisable#may#be#increased#by#the#number#of#securities#which#the#Optionholder#would# have#received#if#the#Option#had#been#exercised#before#the#record#date#for#the#bonus# issue.#
15.# In#the#event#the#Options#are#exercised#by#the#Optionholders,#the#Company#intends#to# use#the#funds#raised#in#accordance#with#Table#4.

ANNEXURE'D'–'TERMS'OF'MANAGEMENT'OPTIONS'

1.# Each#Option#gives#the#Optionholder#the#right#to#subscribe#for#1#Share#for#every#Option# they#own#in#the#Company.#To#obtain#the#right#given#by#each#Option,#the#Optionholder# must#exercise#the#Options#in#accordance#with#these#terms#and#conditions.##
2.# The#Options#will#expire#at#5:00pm#(AEST)#on#the#date#4#years#from#issue#( Expiry'Date ).# Any#Option#not#exercised#before#the#Expiry#Date#will#automatically#lapse#on#the#Expiry# Date.#
3.# The#amount#payable#upon#the#exercise#of#each#Option#will#be#1#cent#($0.02)#( Exercise' Price ).#
4.# The#Options#may#be#exercised#in#whole#or#in#part,#and#if#exercised#in#part,#multiples#of# 100,000#must#be#exercised#on#each#occasion.#
5.# Optionholders# may# exercise# their# Options# by# lodging# with# the# Company,# before# the# Expiry#Date:#
(a)# a#written#notice#of#exercise#of#Options#specifying#the#number#of#Options#being# exercisedK#and#
(b)# a# cheque# or# electronic# funds# transfer# for# the# Exercise# Price# for# the# number# of# Options#being#exercised.#

( Exercise'Notice )#

6.# An#Exercise#Notice#is#only#effective#when#the#Company#has#received#the#full#amount#of# the#Exercise#Price#in#cleared#funds.#
7.# Within#10#Business#Days#of#receipt#of#the#Exercise#Notice#accompanied#by#the#Exercise# Price,#the#Company#will#allot#the#number#of#Shares#required#under#these#terms#and# conditions#in#respect#of#the#number#of#Options#specified#in#the#Exercise#Notice.#
8.# The#Options#are#freely#transferrable.#
9.# All#Shares#allotted#upon#the#exercise#of#Options#will#upon#allotment#rank#pari#passu#in# all#respects#with#other#Shares.#
10.# The#Company#will#not#apply#for#quotation#of#the#Options#on#ASX.#However,#the#Company# will#apply#for#quotation#of#all#Shares#allotted#pursuant#to#the#exercise#of#the#Options#on# ASX#immediately#after#the#allotment#of#those#Shares.#
11.# If# at# any# time# the# issued# capital# of# the# Company# is# reconstructed,# all# rights# of# the# Optionholder#are#to#be#changed#in#a#manner#consistent#with#the#Corporations#Act#and# the#ASX#Listing#Rules#at#the#time#of#the#reconstruction.#
12.# There# are# no# participating# rights# or# entitlements# inherent# in# the# Options# and# the# Optionholder# will# not# be# entitled# to# participate# in# new# issues# of# capital# offered# to# Shareholders#during#the#currency#of#the#Options.#However,#the#Company#will#ensure# that#for#the#purposes#of#determining#entitlements#to#any#such#issue,#the#record#date#will# be#at#least#6#Business#Days#after#the#issue#is#announced.#This#will#give#the#Optionholder# the#opportunity#to#exercise#the#Options#prior#to#the#date#for#determining#entitlements#to# participate#in#any#such#issue.#

13.# In#the#event#the#Company#proceeds#with#a#pro#rata#issue#(except#a#bonus#issue)#of# securities#to#Shareholders#after#the#date#of#issue#of#the#Options,#the#exercise#price#of# the#Options#may#be#reduced#in#accordance#with#the#formula#set#out#in#ASX#Listing#Rule# 6.22.2.#
14.# In#the#event#the#Company#proceeds#with#a#bonus#issue#of#securities#to#Shareholders# after#the#date#of#issue#of#the#Options,#the#number#of#securities#over#which#an#Option#is# exercisable#may#be#increased#by#the#number#of#securities#which#the#Optionholder#would# have#received#if#the#Option#had#been#exercised#before#the#record#date#for#the#bonus# issue.#
15.# In#the#event#the#Options#are#exercised#by#the#Optionholders,#the#Company#intends#to# use#the#funds#raised#in#accordance#with#Table#4.

ANNEXURE'E'–'NOMINATION'OF'AUDITOR'

All registry communications to: Automic Registry Services PO Box 223 West Perth WA 6872

Navigator Resources Limited (Subject to Deed of Company Arrangement)

ACN 063 366 487

Holder Number

Security Holder Appointment of Proxy – Extraordinary General Meeting

I/We being a Shareholder entitled to attend and vote at the Meeting, hereby appoint

OR The Chair as my/our proxy

(Name of Proxy)

or failing the person so named or, if no person is named, the Chair, or the Chair’s nominee, to vote in accordance with the following directions, or, if no directions have been given, and subject to the relevant laws as the proxy sees fit, at the Extraordinary General Meeting to be held at 10.30am (AWST) on 21 January 2016 at the offices of Otsana Capital, 108 Outram Street, West Perth, WA and at any adjournment thereof.

AUTHORITY FOR CHAIR TO VOTE UNDIRECTED PROXIES ON REMUNERATION RELATED RESOLUTIONS

Where I/we have appointed the Chair as my/our proxy (or where the Chair becomes my/our proxy by default), I/we expressly authorise the Chair to exercise my/our proxy on Resolutions 1, 2, 3 and 16 (except where I/we have indicated a different voting intention below) even though Resolutions 1, 2, 3 and 16 are connected directly or indirectly with the remuneration of a member of the Key Management Personnel, which includes the Chair.

The Chair intends to vote undirected proxies in favour of all Resolutions in which the Chair is entitled to vote.

Unless indicated otherwise by ticking the “for”,” against” or “abstain” box you will be authorising the Chair to vote in accordance with the Chair’s voting intention.

VOTING ON BUSINESS OF THE MEETING

Resolutions For Against Abstain Resolutions For Against Abstain 1 ISSUE OF SECURITIES PURSUANT TO THE 9 ELECTION OF MR GREG RUDDOCK AS FIRST PLACEMENT A DIRECTOR 2 ISSUE OF SECOND PLACEMENT SHARES 10 ELECTION OF MR JOSHUA MCKEAN AS A DIRECTOR 3 APPROVAL OF FUTURE ISSUE OF 11 ELECTION OF MR GLEN DOBBIE AS 50,000,000 MANAGEMENT OPTIONS A DIRECTOR 4 ACQUISITION OF A RELEVANT INTEREST 12 ELECTION OF MR MALCOLM KEEFE AS A DIRECTOR 5 RELATED PARTY APPROVAL – 13 REPEAL AND ADOPTION OF A GREG RUDDOCK CONSTITUTION 6 RELATED PARTY APPROVAL – 14 REMOVAL OF AUDITOR JOSHUA MCKEAN 7 RELATED PARTY APPROVAL – 15 APPOINTMENT OF AUDITOR GLEN DOBBIE 8 RELATED PARTY APPROVAL – 16 INCREASE NON-EXECUTIVE DIRECTORS’ MALCOLM KEEFE FEE POOL

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

SIGNATURE OF SHAREHOLDER(S):

Individual or Shareholder 1 Shareholder 2

Sole Director or Director Sole Director / Company Secretary

Shareholder 3 Director / Company Secretary

INSTRUCTIONS FOR COMPLETING ‘APPOINTMENT OF PROXY’ FORM

APPOINTING A PROXY

A Shareholder entitled to attend and cast a vote at the Meeting is entitled to appoint a proxy to attend and vote on their behalf at the Meeting. The appointed proxy may be an individual or body corporate.

If a Body Corporate is appointed to act as your proxy then a representative of that Body Corporate must be appointed to act as its representative. When attending the meeting, the representative must bring a formal notice of appointment as per section 250D of the Corporations Act. Such notice must be signed as required by section 127 of the Corporations Act or the Body Corporate’s Constitution.

If a Shareholder is entitled to cast 2 or more votes at the Meeting, the Shareholder may appoint a second proxy to attend and vote on their behalf at the Meeting. However, where both proxies attend the Meeting, voting may only be exercised on a poll.

The appointment of a second proxy must be done on a separate copy of the Proxy Form. A Shareholder who appoints 2 proxies may specify the proportion or number of votes each proxy is appointed to exercise. If a Shareholder appoints 2 proxies and the appointments do not specify the proportion or number of the Shareholder’s votes each proxy is appointed to exercise, each proxy may exercise one-half of the votes. Any fractions of votes resulting from the application of these principles will be disregarded. A duly appointed proxy need not be a Shareholder.

Note: If you wish to appoint a second proxy, you may copy this form but you must return both forms together.

VOTING ON BUSINESS OF MEETING

A Shareholder may direct a proxy how to vote by marking one of the boxes opposite each item of business. The direction may specify the number of votes that the proxy may exercise by writing the number of Shares next to the box marked for the relevant item of business.

Where a box is not marked the proxy may vote as they choose subject to the relevant laws.

Where more than one box is marked on an item the vote will be invalid on that item.

SIGNING INSTRUCTIONS

Individual : Where the holding is in one name, the Shareholder must sign.
Joint holding : Where the holding is in more than one name, all of the Shareholders should sign.
Power of attorney : If you have not already lodged the power of attorney with the registry, please attach a certified photocopy of the power of attorney to this Proxy Form when you return it.
Companies : To be signed in accordance with your Constitution. Please sign in the appropriate box which indicates the office held by you.

ATTENDING THE MEETING

Completion of a Proxy Form will not prevent individual Shareholders from attending the Meeting in person if they wish. Where a Shareholder completes and lodges a valid Proxy Form and attends the Meeting in person, then the proxy’s authority to speak and vote for that Shareholder is suspended while the Shareholder is present at the Meeting.

LODGEMENT OF VOTES

To be effective, a validly appointed proxy must be received by the Company not less than 48 hours prior to commencement of the Meeting.

Proxy appointments can be lodged by:

a) Hand Delivery – to Pitcher Partners, Attention: Philip Girling, Level 1, 914 Hay Street, Perth WA, 6000; or
b) Post - to Pitcher Partners, Attention: Philip Girling, P.O Box 7191, Cloisters Square, WA, 6850; or
c) Facsimile - to to Pitcher Partners, Attention: Philip Girling on (08) 9322 1262.

Proxy Forms received later than this time will be invalid

AI assistant

AF LEGAL GROUP LTD — Proxy Solicitation & Information Statement 2015

64326_rns_2015-12-17_8830e742-ad63-4bcb-b00d-02c2e7c84260.pdf

NAVIGATOR)RESOURCES)LIMITED))) (Subject)to)Deed)of)Company)Arrangement)))

ACN)063)366)487)

NOTICE)OF)EXTRAORDINARY)GENERAL) MEETING)

EXPLANATORY)STATEMENT)

PROXY)FORM)

CONTENTS)PAGE)

VENUE)

YOUR)VOTE)IS)IMPORTANT)

VOTING)IN)PERSON)

VOTING)BY)PROXY))

LETTER)TO)SHAREHOLDERS))

NOTICE)OF)EXTRAORDINARY)GENERAL)MEETING

RESOLUTIONS

1.) RESOLUTION)1)–)ISSUE)OF)SECURITIES)PURSUANT)TO)THE)FIRST)PLACEMENT)

2.) RESOLUTION)2)–)ISSUE)OF)SECOND)PLACEMENT)SHARES)

3.) RESOLUTION)3)–)APPROVAL)OF)FUTURE)ISSUE)OF)50,000,000)MANAGEMENT) OPTIONS)

4.) RESOLUTION)4)–)ACQUISITION)OF)A)RELEVANT)INTEREST)

5.) RESOLUTION)5)–)RELATED)PARTY)APPROVAL)–)GREG)RUDDOCK)

6.) RESOLUTION)6)–)RELATED)PARTY)APPROVAL)–)JOSHUA)MCKEAN))

7.) RESOLUTION)7)–)RELATED)PARTY)APPROVAL)–)GLEN)DOBBIE)

8.) RESOLUTION)8)–)RELATED)PARTY)APPROVAL)–)MALCOLM)KEEFE)

9.) RESOLUTION)9)–)ELECTION)OF)MR)GREG)RUDDOCK)AS)A)DIRECTOR)

10.) RESOLUTION)10)–)ELECTION)OF)MR)JOSHUA)MCKEAN)AS)A)DIRECTOR)

11.) RESOLUTION)11)–)ELECTION)OF)MR)GLEN)DOBBIE)AS)A)DIRECTOR)

12.) RESOLUTION)12)–)ELECTION)OF)MR)MALCOLM)KEEFE)AS)A)DIRECTOR)

13.) RESOLUTION)13)–)REPEAL)AND)ADOPTION)OF)A)CONSTITUTION)

14.) RESOLUTION)14)–)REMOVAL)OF)AUDITOR)

15.) RESOLUTION)15)–)APPOINTMENT)OF)AUDITOR)

16.) RESOLUTION)16)–)INCREASE)NONdEXECUTIVE)DIRECTORS’)FEE)POOL)

EXPLANATORY)STATEMENT)

Background)to)the)Recapitalisation

1.) Summary)of)the)terms)of)the)Proposal)

2.) Summary)of)the)conditions)of)the)Proposal)

3.) Proposed)prodforma)capital)structure)of)the)Company)

Notes:)

4.) Proposed)business)strategy)and)use)of)funds)raised)by)the)Company)

Business)Strategy

Mineral'Resources''

Report)on)Cummins)Range)Rare)Earth)Deposit.))

Resource Estimates - Cummins Range Rare Earth Deposit

Appendix 1

JORC Code, 2012 Edition – Table 1 Cummins Range REE Deposit

Section 1 Sampling Techniques and Data

Section 2 Reporting of Exploration Results

Section 3 Estimation and Reporting of Mineral Resources

References

Consent

Use)of)Funds)

Notes:)

5.) Reinstatement)to)Official)quotation)of)the)ASX)

RESOLUTION)1–)ISSUE)OF)SECURITIES)PURSUANT)TO)THE)FIRST)PLACEMENT))

General

Information)required)by)ASX)Listing)Rule)7.1

RESOLUTION)2)–)ISSUE)OF)SECOND)PLACEMENT)SHARES))

General)

Information)required)by)ASX)Listing)Rule)7.1

RESOLUTION) 3) –) APPROVAL) OF) FUTURE) ISSUE) OF) 50,000,000) MANAGEMENT) OPTIONS))

Information)Required)by)ASX)Listing)Rule)7.3))

RESOLUTION)4)–)ACQUISITION)OF)A)RELEVANT)INTEREST)

Syndicate

Information)Required)pursuant)to)Chapter)6)of)the)Corporations)Act)

Why!is!approval!under!the!exception!in!item!7!of!section!611!of!the!Corporations!Act!needed?

Relevant!interests,!voting!power!and!proposed!capital!structure!of!the!Company!

Notes:)

Intentions!of!the!Syndicate!(or!their!nominees)!

Advantages,!disadvantages!and!risks!of!the!Proposal

Independent)Expert’s)Report

Shareholders) are) urged) to) carefully) read) the) IER) before) deciding) how) to) vote) on Resolution)4.)

New)Board’s)Recommendation

Professional)Advice

RESOLUTIONS)5,)6,)7)and)8)–)RELATED)PARTY)APPROVALS)

Information)Required)by)ASX)Listing)Rule)10.13)

Information)Required)by)Chapter)2E)of)the)Corporations)Act)

New!Board’s!recommendation!and!basis!of!financial!benefit

Capital!Structure!if!Shareholder!approval!is!obtained!for!all!Resolutions

Existing!and!potential!relevant!interests

Trading!history

AF LEGAL GROUP LTD Proxy Solicitation & Information Statement 2015