AUDALIA RESOURCES LIMITED — Share Issue/Capital Change 2015

Dec 28, 2015

ANNOUNCEMENT

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SECONDARY TRADING NOTICE

24 DECEMBER 2015

Audalia Resources Limited ( Audalia or the Company ) (ASX: ACP) advises that it has today issued 2,000,000 fully paid ordinary shares ( Shares ) to Mr Brent Butler, CEO and Executive Director. The Shares have been issued to Mr Butler under the terms of his consultant agreement dated 14 April 2015 and following the successful grant of mining lease application M63/656 over the Company’s flagship Medcalf Project.

Approval for the issue of Shares was received from shareholders at the Company’s annual general meeting on 27 November 2015.

An Appendix 3B seeking quotation of the Shares follows this announcement.

Secondary Trading Notice Pursuant to Paragraph 708A(5)(e) of the Corporations Act 2001 ("Act")

The Act restricts the on-sale of securities issued without disclosure, unless the sale is exempt under section 708 or 708A of the Act. By giving this notice, a sale of the Shares noted above will fall within the exemption in section 708A(5) of the Act.

The Company hereby notifies ASX under paragraph 708A(5)(e) of the Act that:

• (a) the Company issued the Shares without disclosure to investors under Part 6D.2 of the Act;

• (b) as at the date of this Notice, the Company has complied with the provisions of Chapter 2M of the Act as they apply to the Company, and section 674 of the Act; and

• (c) as at the date of this Notice, there is no information:

• (i) that has been excluded from a continuous disclosure notice in accordance with the ASX Listing Rules; and

• (ii) that investors and their professional advisers would reasonably require for the purpose of making an informed assessment of:

  • a. the assets and liabilities, financial position and performance, profits and losses and prospects of the Company; or

  • b. the rights and liabilities attaching to the relevant Shares.

Authorised by:

Karen Logan Company Secretary

ASX: ACP l Find out more at www.audalia.com.au

1

Appendix 3B New issue announcement

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX’s property and may be made public.

Introduced 01/07/96 Origin: Appendix 5 Amended 01/07/98, 01/09/99, 01/07/00, 30/09/01, 11/03/02, 01/01/03, 24/10/05, 01/08/12

Name of entity

AUDALIA RESOURCES LIMITED

ABN

49 146 035 690

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

1 +Class of+securities issued or to be issued 2 Number of+securities issued or to be issued (if known) or maximum number which may be issued 3 Principal terms of the +securities (eg, if options, exercise price and expiry date; if partly paid +securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)	Shares.
	2,000,000 Shares.
	Fully paid ordinary shares.

• See chapter 19 for defined terms.

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4 Do the+securities rank equally in all respects from the date of allotment with an existing+class of quoted+securities? If the additional securities do not rank equally, please state: • the date from which they do • the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment • the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration 6 Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets) 6a Is the entity an+eligible entity that has obtained security holder approval under rule 7.1A? If Yes, complete sections 6b – 6h in relation to the+securities the subject of this Appendix 3B, and comply with section 6i 6b The date the security holder resolution under rule 7.1A was passed 6c Number of+securities issued without security holder approval under rule 7.1	Yes.
	Nil.
	The Shares have been issued pursuant to an agreement between the Company and the CEO and Executive Director dated 14 April 2015. Approval for the issue of shares was received from shareholders at the AGM held on 27 November 2015.
	No.
	Not applicable.
	Nil.

• See chapter 19 for defined terms.

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6d Number of+securities issued with security holder approval under rule 7.1A 6e Number of+securities issued with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting) 6f Number of securities issued under an exception in rule 7.2 6g If securities issued under rule 7.1A, was issue price at least 75% of 15 day VWAP as calculated under rule 7.1A.3? Include the issue date and both values. Include the source of the VWAP calculation. 6h If securities were issued under rule 7.1A for non-cash consideration, state date on which valuation of consideration was released to ASX Market Announcements 6i Calculate the entity’s remaining issue capacity under rule 7.1 and rule 7.1A – complete Annexure 1 and release to ASX Market Announcements 7 Dates of entering +securities into uncertificated holdings or despatch of certificates 8 Number and +class of all +securities quoted on ASX (including the securities in section 2 if applicable)	Nil.	Nil.
	24 December 2015.
	2,000,000 Shares.
	Not applicable.
	Not applicable.
	Rule 7.1: 30,624,000 Rule 7.1A: Not Applicable
	24 December 2015.
	Number	+Class
	238,660,001	Fully paid ordinary shares.

• See chapter 19 for defined terms.

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Number +Class 9 Number and +class of all Not applicable +securities not quoted on ASX ( including the securities in section 2 if applicable) 10 Dividend policy (in the case of a Not applicable trust, distribution policy) on the increased capital (interests)

Part 2 - Bonus issue or pro rata issue

Questions 11 to 33 – Not Applicable

Part 3 - Quotation of securities

You need only complete this section if you are applying for quotation of securities

34 Type of securities ( tick one ) (a) � Securities described in Part 1

• (b) All other securities

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Questions 35 to 37 – Not Applicable

Entities that have ticked box 34(b)

Questions 38 to 42 – Not Applicable

• See chapter 19 for defined terms.

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Quotation agreement

• 1 +Quotation of our additional +securities is in ASX’s absolute discretion. ASX may quote the[+] securities on any conditions it decides.

• 2 We warrant the following to ASX.

• The issue of the[+] securities to be quoted complies with the law and is not for an illegal purpose.

• There is no reason why those[+] securities should not be granted +quotation.

• An offer of the[+] securities for sale within 12 months after their issue will not require disclosure under section 707(3) or section 1012C(6) of the Corporations Act.

Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any[+] securities to be quoted and that no-one has any right to return any[+] securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the[+] securities be quoted.

• If we are a trust, we warrant that no person has the right to return the +securities to be quoted under section 1019B of the Corporations Act at the time that we request that the[+] securities be quoted.

• 3 We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.

• 4 We give ASX the information and documents required by this form. If any information or document not available now, will give it to ASX before +quotation of the +securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

Sign here: ............................................................Date: 24 December 2015

Company Secretary

Print name: Karen Logan

== == == == ==

• See chapter 19 for defined terms.

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Appendix 3B – Annexure 1

Calculation of placement capacity under rule 7.1 and rule 7.1A for +eligible entities

Introduced 01/08/12

Part 1

Rule 7.1 – Issues exceeding 15% of capital

Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

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Insert number of fully paid ordinary 232,160,001
securities on issue 12 months before date
of issue or agreement to issue
Add the following: 2,000,000
• Number of fully paid ordinary securities • 2,000,000 fully paid ordinary shares
issued in that 12 month period under an issued on 24 December 2015,
exception in rule 7.2 exception 14 .
• Number of fully paid ordinary securities Nil
issued in that 12 month period with
shareholder approval
• Number of partly paid ordinary securities Nil
that became fully paid in that 12 month
period
Note:
• Include only ordinary securities here –
other classes of equity securities cannot
be added
• Include here (if applicable) the securities
the subject of the Appendix 3B to which
this form is annexed
• It may be useful to set out issues of
securities on different dates as separate
line items
Subtract the number of fully paid ordinary Nil
securities cancelled during that 12 month
period
“A” 234,160,001
Step 2: Calculate 15% of “A”
“B” 0.15
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• See chapter 19 for defined terms.

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	[Note: this value cannot be changed]
Multiply“A” by 0.15	35,124,000
Step 3: Calculate “C”, the amount of placement capacity under rule 7.1 that has already been used
Insertnumber of equity securities issued or agreed to be issued in that 12 month period not counting_those issued: • Under an exception in rule 7.2 • Under rule 7.1A • With security holder approval under rule 7.1 or rule 7.4 _Note: • This applies to equity securities, unless specifically excluded – not just ordinary securities • Include here (if applicable ) the securities the subject of the Appendix 3B to which this form is annexed • It may be useful to set out issues of securities on different dates as separate line items	4,500,000 • 2,000,000 fully paid ordinary shares issued on 26 February 2015; and • 2,500,000 fully paid ordinary shares to a consultant on 23 November 2015.
“C”	4,500,000
Step 4: Subtract “C” from [“A” x “B”] to calculate remaining placement capacity under rule 7.1
“A” x 0.15 Note: number must be same as shown in Step 2	35,124,000
Subtract“C” Note: number must be same as shown in Step 3	4,500,000
Total[“A” x 0.15] – “C”	30,624,000 [Note: this is the remaining placement capacity under rule 7.1]

• See chapter 19 for defined terms.

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Part 2

Rule 7.1A – Additional placement capacity for eligible entities Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

“A” Not applicable Note: number must be same as shown in Step 1 of Part 1 Step 2: Calculate 10% of “A” “D” 0.10 Note: this value cannot be changed Multiply “A” by 0.10 Nil Step 3: Calculate “E”, the amount of placement capacity under rule 7.1A that has already been used Insert number of equity securities issued or Nil. agreed to be issued in that 12 month period under rule 7.1A

Notes:

• This applies to equity securities – not just ordinary securities

• Include here – if applicable – the securities the subject of the Appendix 3B to which this form is annexed

• Do not include equity securities issued under rule 7.1 (they must be dealt with in Part 1), or for which specific security holder approval has been obtained

• It may be useful to set out issues of securities on different dates as separate line items

• “E” Nil.

• See chapter 19 for defined terms.

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Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A

Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A	Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A
“A” x 0.10 Note: number must be same as shown in Step 2	Nil
Subtract“E” Note: number must be same as shown in Step 3	Nil.
Total[“A” x 0.10] – “E”	Nil. Note: this is the remaining placement capacity under rule 7.1A

• See chapter 19 for defined terms.

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