AUSGOLD LIMITED — AGM Information 2016

Oct 11, 2016

==> picture [247 x 133] intentionally omitted <==

AUSGOLD LIMITED ABN 67 140 164 496

NOTICE OF ANNUAL GENERAL MEETING

EXPLANATORY MEMORANDUM

PROXY FORM

Date: Friday, 11 November 2016 Time: 11.00 am AWST Venue: Level 1, AMP Building 140 St Georges Terrace Perth, WA 6000

These documents should be read in their entirety. If shareholders are in doubt as to how they should vote, they should seek advice from their accountant, solicitor or other professional adviser prior to voting

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

AUSGOLD LIMITED

(ABN 67 140 164 496)

NOTICE OF ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that the annual general meeting of Ausgold Limited will be held at Level 1, AMP Building, 140 St Georges Terrace, Perth, Western Australia on Friday 11 November 2016 at 11.00am (AWST).

AGENDA

ORDINARY BUSINESS

FINANCIAL STATEMENTS

To receive, consider and discuss the Company’s financial statements for the year ended 30 June 2016 and the reports of the directors and auditors on those statements.

RESOLUTION 1 – RE–ELECTION OF DIRECTOR – MR RICHARD LOCKWOOD

To consider, and if thought fit to pass, the following resolution as an ordinary resolution :

“That, for the purpose of ASX Listing Rule 14.4 and rule 58.1 of the Constitution, and for all other purposes, Mr Richard Lockwood, a Director who retires by rotation and, being eligible, offers himself for re-election, is re-elected as a Director.”

RESOLUTION 2 – RE–ELECTION OF DIRECTOR – MR NEIL FEARIS

To consider, and if thought fit to pass, the following resolution as an ordinary resolution:

“That, for the purpose of ASX Listing Rule 14.4 and rule 57.1 of the Constitution, and for all other purposes, Mr Neil Fearis, a Director who retires and, being eligible, offers himself for re-election, is reelected as a Director.”

RESOLUTION 3 – RE–ELECTION OF DIRECTOR – MR GEOFFREY JONES

To consider, and if thought fit to pass, the following resolution as an ordinary resolution:

“That, for the purpose of ASX Listing Rule 14.4 and rule 57.1 of the Constitution, and for all other purposes, Mr Geoffrey Jones, a Director who retires and, being eligible, offers himself for re-election, is re-elected as a Director.”

RESOLUTION 4 – ADOPTION OF REMUNERATION REPORT

To consider, and if thought fit to pass, the following resolution as an ordinary resolution :

“That, for the purposes of section 250R(2) of the Corporations Act 2001 and for all other purposes, the Remuneration Report contained in the 2016 Annual Report be adopted by shareholders.”

Note:

In accordance with section 250R(3) of the Corporations Act 2001, this resolution is advisory only and does not bind the directors of the Company.

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

1

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

Voting exclusion statement:

The Company will disregard any votes cast on resolution 4 by or on behalf of any member of the Key Management Personnel, details of whose remuneration are included in the Remuneration Report, or any Closely Related Party of such a member. However, the Company need not disregard a vote if it is cast by such a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form, or it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides.

RESOLUTION 5 – RATIFY ALLOTMENT OF SHARES

To consider, and if thought fit to pass, the following resolution as an ordinary resolution :

“That for the purpose of ASX Listing Rule 7.4 and all other purposes, the allotment on 27 July 2016 of a total of 21,000,000 fully paid ordinary shares in the Company on the terms described in the explanatory memorandum which accompanied the notice convening this meeting be and is hereby ratified”.

Voting exclusion statement:

For the purpose of Listing Rule 7.5.6, and for all other purposes, the Company will disregard any votes cast on this Resolution 5 by any individual who participated in the issue and any of his associates.

However, the Company will not disregard a vote if;

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

• b) it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

RESOLUTION 6 - ISSUE OF OPTIONS TO RICHARD LOCKWOOD

To consider and, if thought fit to pass, the following Resolution as an ordinary resolution:

“That for the purposes of ASX Listing Rule 10.11, Section 208 of the Corporations Act 2001 and for all other purposes, the Company be authorised to allot and issue 4,000,000 Options to Richard Lockwood, a Director of the Company, or his nominee, on the terms and conditions set out in Appendix ’A‘ to the Explanatory Memorandum”.

Note:

• (1) The Options referred to in Resolution 6 will be issued within one month after the date of the Annual General Meeting.

• (2) The Options will be issued for nil consideration and no funds will be raised from this issue.

• (3) Voting exclusion statement:

• In accordance with Listing Rules 10.13.6 and 14.11, Section 224 of the Corporations Act and for all other purposes, the Company will disregard any votes cast on Resolution 6 by or on behalf of:

• (a) Mr Richard Lockwood;

• (b) a person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities in the Company if Resolution 6 is passed;

• (c) any member of the Key Management Personnel or any Closely Related Party of such a member; and

• (d) any Associate or nominee of the abovementioned person. However, the Company will not disregard a vote if:

• (e) 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

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

2

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

• (f) it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

RESOLUTION 7 - ISSUE OF OPTIONS TO DENIS RAKICH

To consider and, if thought fit, to pass the following Resolution as an ordinary resolution:

“That for the purposes of ASX Listing Rule 10.11, Section 208 of the Corporations Act and for all other purposes, the Company be authorised to allot and issue 4,000,000 Options to Denis Rakich, a Director of the Company, or his nominee, on the terms and conditions set out in Appendix “A” to the Explanatory Memorandum.”

Note:

• (1) The Options referred to in Resolution 7 will be issued within one month after the date of the General Meeting.

• (2) The Options will be issued nil consideration and no funds will be raised from the issue.

• (3) Voting exclusion statement:

• In accordance with Listing Rules 10.13.6 and 14.11, Section 224 of the Corporations Act and for all other purposes, the Company will disregard any votes cast on Resolution 7 by or on behalf of:

• (a) Mr Denis Rakich;

• (b) a person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities in the Company if Resolution 7 is passed;

• (c) any member of the Key Management Personnel or any Closely Related Party of such a member; and

• (d) any Associate or nominee of the abovementioned person. However, the Company will not disregard a vote if:

• (e) 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

• (f) it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

RESOLUTION 8 - ISSUE OF OPTIONS TO NEIL FEARIS

To consider and, if thought fit, to pass the following Resolution as an ordinary resolution:

“That for the purposes of ASX Listing Rule 10.11, Section 208 of the Corporations Act 2001 and for all other purposes, this meeting approves the issue of 4,000,000 Options to Neil Fearis as a Director of the Company (or his nominee), such Options to be issued on the terms and conditions set out in Appendix “A” to the Explanatory Memorandum.”

Note:

• (1) The Options referred to in Resolution 8 will be issued within one month after the date of the General Meeting.

• (2) The Options will be issued for nil consideration and no funds will be raised from the issue. (3) Voting exclusion statement:

• In accordance with Listing Rule 10.13.6 and Section 224 of the Corporations Act and for all other purposes, the Company will disregard any votes cast on Resolution 8 by or on behalf of:

• (a) Mr Neil Fearis;

• (b) a person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities in the Company if Resolution 8, is passed;

• (c) any member of the Key Management Personnel or any Closely Related Party of such a member; and

(d) any Associate or nominee of the abovementioned person. However, the Company will not disregard a vote if:

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

3

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

• (e) 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

• (f) it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

RESOLUTION 9 - ISSUE OF OPTIONS TO GEOFFREY JONES

To consider and, if thought fit, to pass the following Resolution as an ordinary resolution:

“That for the purposes of ASX Listing Rule 10.11, Section 208 of the Corporations Act 2001 and for all other purposes, this meeting approves the issue of 4,000,000 Options to Geoffrey Jones as a Director of the Company (or his nominee), such Options to be issued on the terms and conditions set out in Appendix “A” to the Explanatory Memorandum.”

Note:

• (1) The Options referred to in Resolution 9 will be issued within one month after the date of the General Meeting.

• (2) The Options will be issued free of charge and no funds will be raised from the issue.

• (3) Voting exclusion statement:

• In accordance with Listing Rule 10.13.6 and Section 224 of the Corporations Act and for all other purposes, the Company will disregard any votes cast on Resolution 9 by or on behalf of:

• (a) Mr Geoffrey Jones;

• (b) a person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities in the Company if Resolution 9 is passed;

• (c) any member of the Key Management Personnel or any Closely Related Party of such a member; and

• (d) any Associate or nominee of the abovementioned person.

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

• (e) 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

• (f) it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

RESOLUTION 10 – APPROVAL OF ADDITIONAL 10% PLACEMENT FACILITY

To consider and, if thought fit, to pass the following Resolution as a special resolution:

“That for the purposes of ASX Listing Rule 7.1A and for all other purposes, Shareholders approve the issue of Equity Securities up to 10% of the issued capital of the Company (at the time of the issue), calculated in accordance with the formula prescribed in Listing Rule 7.1A.2 for the purpose and on the terms and conditions set out in the Explanatory Memorandum accompanying this Notice of Annual General Meeting.”

Voting exclusion statement :

For the purpose of Listing Rule 7.3A.7, and for all other purposes, the Company will disregard any votes cast on this Resolution 10 by any person (and any associates of such person) who may participate in the Additional 10% Placement Facility and a person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities, if the Resolution is passed, and any associates of those persons. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the proxy form, or, it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

However, the Company will not disregard a vote if;

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

4

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

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

• b) it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

PROXIES

In accordance with section 249L of the Corporations Act 2001, members are advised that:

• each member has a right to appoint a proxy;

• the proxy need not be a member of the Company;

• a member who is entitled to cast two or more votes may appoint two proxies and may specify the proportion or number of votes each proxy is appointed to exercise. If no proportion or number is specified, then in accordance with section 249X(3) of the Corporations Act 2001, each proxy may exercise one-half of the votes.

In accordance with section 250BA of the Corporations Act 2001, the Company specifies the following information for the purposes of receipt of proxy appointments:

Registered Office: Ausgold Limited Level 16, AMP Building, 140 St George Terrace, Perth WA 6000 Facsimile Number: (08) 9220 9820 Postal Address: PO Box 7654, Cloisters Square, Perth WA 6850

Each member entitled to vote at the general meeting has the right to appoint a proxy to attend and vote at the meeting on his behalf. The member may specify the way in which the proxy is to vote on each resolution or may allow the proxy to vote at his discretion. The instrument appointing the proxy must be received by the Company at the address specified above at least 48 hours before the time notified for the meeting (proxy forms can be lodged by facsimile).

In accordance with regulation 7.11.38 of the Corporations Regulations 2001, the Company determines that shares held as at 11.00 am on Wednesday 9 November 2016 will be taken, for the purposes of the general meeting, to be held by the persons who held them at that time.

By order of the Board

==> picture [94 x 52] intentionally omitted <==

DENIS I RAKICH Director

4 October 2016

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

5

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

AUSGOLD LIMITED

(ABN 67 140 164 496)

EXPLANATORY MEMORANDUM TO SHAREHOLDERS

1. INTRODUCTION

This Explanatory Memorandum has been prepared for the information of shareholders of Ausgold in connection with the business to be transacted at the annual general meeting of the Company to be held on Friday 11 November 2016 at 11.00am.

At that meeting, shareholders will be asked to consider resolutions:

• re-electing a director who retires by rotation;

• re-electing directors who retire;

• adopting the remuneration report;

• ratifying the allotment of shares;

• approving the issue of options to directors; and

• approving an additional 10% placement facility.

The purpose of this Explanatory Memorandum is to provide information that the Board believes to be material to shareholders in deciding whether or not to pass those resolutions. The Explanatory Memorandum explains the resolutions and identifies the Board’s reasons for putting them to shareholders. It should be read in conjunction with the accompanying Notice of Meeting.

2. RESOLUTION 1 – RE–ELECTION OF MR RICHARD LOCKWOOD AS A DIRECTOR

In accordance with ASX Listing Rule 14.4 and pursuant to Rule 58.1 of the Constitution, at each annual general meeting one-third of the Directors (excluding the Managing Director, if any) must retire from office. Each retiring Director is entitled to offer himself for re-election as a Director at the annual general meeting.

Mr Richard Lockwood will retire by rotation in accordance with the requirements of the Constitution at the AGM. Mr Lockwood is eligible for re-election and he seeks re-election as a director of the Company at the AGM.

Mr Lockwood has forged a successful career in funds management and mining investment and was the founder of New City Investment Management a UK based investment fund. Mr Lockwood was formerly a Director of AIM-listed Kalahari Minerals Limited which was acquired by CGNPC Uranium Resources Co. Ltd. Formerly a mining investment partner for Hoare Govett and McIntosh Securities he was involved in the development and financing of numerous gold and base metals projects in Europe, Australia and Africa. Mr Lockwood’s intimate knowledge and experience in the resource sector is an asset to the Company during its current growth phase.

Board recommendation : the Board (other than Mr Lockwood) recommends that Shareholders vote in favour of Resolution 1.

Mr Lockwood was appointed as a director of the Company on 12 November 2010.

3. RESOLUTION 2 – RE–ELECTION OF MR NEIL FEARIS AS A DIRECTOR

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

6

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

Rule 57.1 of the Constitution states that the Directors may appoint any person as a Director to fill a casual vacancy or as an addition to the existing Directors. Any Director so appointed holds office until the next following annual general meeting and is then eligible for re-election.

Mr Fearis was appointed as a director of the Company on 15 April 2016 and, being eligible, he now seeks re-election as a director of the Company at the AGM, in accordance with the requirements of the Constitution.

Mr Fearis is a corporate and commercial lawyer specialising in mergers and acquisitions, capital raisings and corporate reconstructions, with a particular focus on the mining and resources sector. He has been in practice for more than 38 years and worked as a commercial lawyer in London, Sydney and Perth. He provides corporate and commercial legal advice to public company clients and has advised on some of the largest corporate transactions ever undertaken in Australia. Prior to studying law, Neil spent several years engaged in mineral exploration in both Australia and southern Africa and as a result has a good understanding of the practical issues facing companies developing resource projects in remote locations, both in Australia and overseas.

Board recommendation : the Board (other than Mr Fearis) recommends that Shareholders vote in favour of Resolution 2.

4. RESOLUTION 3 – RE–ELECTION OF MR GEOFFREY JONES AS A DIRECTOR

Mr Jones is a Civil Engineer with over 30 years’ experience in construction, engineering, mineral processing and project development in Australia and overseas. Geoff previously worked for Baulderstone Hornibrook, John Holland, Minproc Engineers and Signet Engineering before serving over six years as Group Project Engineer for Resolute Mining Limited, where he was responsible for the development of its mining projects in Australia, Ghana and Tanzania. He also founded a project management and engineering consultancy concentrating on the management of projects for ASX listed companies in the resources sector. Mr Jones is currently the Managing Director for GR Engineering Services Limited.

Mr Jones was appointed as a director of the Company on 29 July 2016 and being eligible, he now seeks re-election as a director of the Company at the AGM , in accordance with the requirements of the Constitution.

Board recommendation : the Board (other than Mr Jones) recommends that Shareholders vote in favour of Resolution 3.

5. RESOLUTION 4 – ADOPTION OF REMUNERATION REPORT

The Corporations Act includes disclosure requirements for companies whose shares are quoted on the ASX by requiring that the directors of the company include a remuneration report in the Company’s annual report and that a resolution be put to shareholders each year to adopt that report. Pursuant to section 250R(2) of the Corporations Act, the Company submits to Shareholders for consideration and adoption by way of a non-binding resolution, its remuneration report for the year ended 30 June 2016.

The remuneration report is set out in the Company’s Annual Report. The remuneration report:

• outlines the Board’s policy for determining the nature and amount of remuneration for directors and executives of the Company;

• discusses the relationship between the Board’s remuneration policy and the Company’s performance;

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

7

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

• details and explains any performance condition applicable to the remuneration of a director or executive;

• details the remuneration (including options) of each director and executive of the Company for the year; and

• summarises the terms of any contract under which any director or executive is engaged, including the period of notice require to terminate the contract and any termination payments provided for under the contract.

The vote on the resolution is advisory only and does not bind the directors or the Company, nor does it affect the remuneration paid or payable to the Company’s directors or the executives. However, the Board will take the outcome of the resolution into account when considering future remuneration policy.

If, at consecutive annual general meetings, at least 25% of the votes cast on a remuneration report resolution are voted against adoption of the remuneration report, and at the first of those annual general meetings a spill resolution was not put to vote, then the Company will be required to put to Shareholders a resolution proposing the calling of a general meeting to consider the appointment of directors of the Company ( Spill Resolution ).

If more than 50% of Shareholders vote in favour of the Spill Resolution, the Company must convene the general meeting ( Spill Meeting ) within 90 days of the second annual general meeting. All of the Directors who were in office when the Company's directors' report (as included in the company’s annual financial report for the most recent financial year) was approved, other than the managing director of the Company, will cease to hold office immediately before the end of the Spill Meeting but may stand for re-election at the Spill Meeting. Following the Spill Meeting those persons whose election or re-election as Directors is approved will be the Directors of the Company.

The remuneration report sets out the Company’s remuneration arrangements for the Directors and senior management of the Company. The remuneration report is part of the Directors’ report contained in the annual financial report of the Company for the financial year ending 30 June 2016.

A reasonable opportunity will be provided for discussion of the remuneration report at the AGM.

Previous voting results

At the Company’s 2015 Annual General Meeting less than 25% of the total votes cast on the resolution to approve the remuneration report considered at that meeting were cast against the resolution. Accordingly, a Spill Resolution is not relevant for this Annual General Meeting.

Proxy voting restrictions

A voting exclusion statement is included in the Notice of Meeting in respect of the advisory vote on Resolution 4.

Board Recommendation

The Board unanimously recommends that Shareholders vote in favour of Resolution 4.

6. RESOLUTION 5 – RATIFY ALLOTMENT OF SHARES

On 27 July 2016 the Company issued a total of 21,000,000 Shares. The issue raised A$1.05 million before costs of the issue.

The purpose of this issue was to fund the Company’s exploration and development programme at the Katanning Gold Project and to provide additional working capital.

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

8

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

Listing Rule 7.1 prohibits a company from issuing or agreeing to issue Equity Securities representing more than 15% of its expanded capital in any 12 month period without first obtaining shareholder approval.

Listing Rule 7.4 allows a company to seek ratification by shareholders of an issue of Equity Securities which has been made without approval under Listing Rule 7.1 provided the issue did not breach Listing Rule 7.1.

As the issue the subject of Resolution 5 was not in breach of Listing Rule 7.1 and was not previously approved by Shareholders, the Board now seeks Shareholder ratification of that issue pursuant to Listing Rule 7.4.

The effect of passing Resolution 5 will be to refresh the Company’s 15% capacity under Listing Rule 7.1 to the extent of the 21,000,000 Shares issued on 27 July 2016.

The Board considers that this is a timely and cost effective opportunity to put Resolution 5 to shareholders at the General Meeting.

For the purposes of Listing Rule 7.5, the following information is provided in relation to Resolution 5:

• (1) The total number of Shares issued was 21,000,000 Shares.

• (2) The Shares were issued at a price of 5 cents each. The Shares rank equally in all respects with the Company's existing Shares.

• (3) The Shares were issued to professional and sophisticated investors unrelated to the Company.

• (4) The purpose of this issue was to fund the Company’s exploration and development programme at the Katanning Gold Project and to provide additional working capital.

• (5) A voting exclusion statement for Resolution 5 is included in the Notice of Meeting.

Board Recommendation

The Board unanimously recommends that Shareholders vote in favour of Resolution 5.

7. RESOLUTIONS 6, 7, 8 AND 9 – ISSUE OF OPTIONS TO DIRECTORS

Background

The Company proposes to issue Options to Mr Lockwood, Mr Rakich, Mr Fearis and Mr Jones, each a Director of the Company, in the following proportions:

Name of Director	Options
R Lockwood	4,000,000
D Rakich	4,000,000
N Fearis	4,000,000
G Jones	4,000,000

Shareholder approval for the issue of the Options is sought pursuant to Listing Rule 10.11 and Section 208 of the Corporations Act.

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

9

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

Shareholders are being asked to approve the issue of the Options to the Directors, which is intended to align their interests with those of the Shareholders and to provide them with incentives to continue their efforts for the benefit of the Company.

Directors’ remuneration packages for the 2017 year will be as follows:

Name of Director	Position	Salary	Director’s fees
R Lockwood	Non-executive & Chairman	$Nil	$Nil
D Rakich	Executive Director/	$140,000	$Nil
	Company Secretary
N Fearis	Non-executive Director	$nil	$25,000
G Jones	Non-executive Director	$nil	$20,000

The Company is cognisant of the ASX Principles of Good Corporate Governance and Best Practice Recommendations, which recommend against the issue of Options to non-executive directors.

However, the Board considers the grant of the Options contemplated by Resolutions 6, 7, 8 and 9 to be reasonable in the circumstances given the Company's current size and stage of development and the necessity in the present market to conserve the Company's cash reserves.

Each Option will be exercisable at a price of 8 cents and expires on 30 November 2020.

The number, exercise price and other terms of the Options to be issued to the Directors have been arrived at by assessing the value of the remuneration packages that would be necessary and appropriate to provide in order to retain and motivate individuals of their calibre.

The Options will be issued on the terms set out in Annexure ‘A’ to this Explanatory Memorandum.

The Options are being issued for nil consideration and consequently no funds will be raised by the issue. A total of $1,280,000 in additional share capital would be raised if all of the Options were exercised in full and assuming the exercise price is 8 cents per Option.

Requirement for Shareholder approval

Listing Rule 10.11

Listing Rule 10.11 provides that a company must not issue or agree to issue Equity Securities to a related party without first obtaining the approval of Shareholders by ordinary resolution. As Resolutions 6, 7, 8 and 9 relate to the issue of Equity Securities to Directors of the Company, Shareholder approval must be obtained.

As approval of Shareholders is being sought pursuant to Listing Rule 10.11, pursuant to Listing Rule 7.2 Exception 14, approval under Listing Rule 7.1 is not required at this Meeting.

Listing Rule 10.13

In accordance with Listing Rule 10.13, the following information is provided to Shareholders:

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

10

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

• (a) The Options will be issued to Mr Lockwood, Mr Rakich, Mr Fearis and Mr Jones.

• (b) The total number of Options to be issued under Resolutions 6, 7, 8 and 9 is 16,000,000.

• (c) The Options will be issued on the terms set out in Annexure ‘A’ to this Explanatory Memorandum.

• (d) The Options will be issued as soon as practicable after the General Meeting but in any event not later than one month after the General Meeting.

• (e) The Options will be granted for nil consideration and no funds will be raised by their issue. (f) Voting exclusion statements for Resolutions 6, 7, 8 and 9 are included in the Notice of Meeting.

Chapter 2E of the Corporations Act

Chapter 2E of the Corporations Act prohibits a public company from giving a financial benefit to a related party. The Directors and any entities they respectively control are related parties.

The definition of what constitutes giving a financial benefit pursuant to Section 229 of the Corporations Act is broad and does not necessarily involve paying money. It includes buying or selling assets, issuing securities and granting options. It includes giving a financial benefit indirectly, for example, through one or more interposed entities.

Section 229(1)(c) of the Corporations Act provides that in deciding whether a financial benefit is given any consideration that is given for the benefit is to be disregarded, even if it is adequate.

The issue of the Options to related parties contemplated by Resolutions 6, 7, 8 and 9, therefore, constitutes giving a financial benefit to a related party.

Section 208 of the Corporations Act provides an exception from the prohibition contained in Chapter 2E and provides that a public company may give a financial benefit to a related party if a resolution of the shareholders of that public company permits the benefit to be given, and the resolution was passed at a general meeting of the public company held within 15 months before the public company gives the benefit and if the conditions prescribed by Division 3 of Part 2E.1 of the Corporations Act have been satisfied in relation to the Resolution.

Resolutions 6, 7, 8 and 9 are therefore intended to satisfy the requirements of Section 208 of the Corporations Act to provide a financial benefit to a related party. Each Director is a “related party” of the Company for this purpose, whilst the issue of the Options constitutes a “financial benefit”.

The following information is provided to Shareholders in accordance with Section 219 of the Corporations Act to enable Shareholders to determine whether or not it is in the Company’s interests to pass the Resolutions:

• (a) The persons to whom Resolutions 6, 7, 8 and 9 would permit a financial benefit to be given are Mr Lockwood, Mr Rakich, Mr Fearis and Mr Jones, each of whom is a Director of the Company and a related party of the Company by virtue of Section 228(2)(a) of the Corporations Act.

• (b) The nature of the financial benefit to be given is the issue of the Options referred to in Resolutions 6, 7, 8 and 9.

• (c) Based on a Binomial Option Pricing Model valuation method, the Company estimates that, as at 4 October 2016, the Options had a value per Option of $0.0263, giving a total value for the Options to be issued of $105,200 (for Mr Lockwood), $105,200 (for Mr Rakich), $105,200 (for Mr Fearis) and $105,200 (for Mr Jones).

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

11

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

The key assumptions used in arriving at the valuation were:

Exerciseprice	:	8 cents
Expirydate	:	30 November 2020
Volatilityfactor	:	113%
Shareprice	:	$0.043
Risk-free interest rate	:	1.69%
Dividendyield	:	-

(d) Over the last 12 months, the highest recorded sale price of Ausgold Shares in trading on the ASX was $0.069 (on 12 May 2016), and the lowest recorded sale price was $0.031 (on 23 December 2015). The last recorded sale price of Ausgold Shares before the date of this Explanatory Memorandum was $0.043.

(e) The Directors have the following relevant interests in Equity Securities issued by Ausgold:

Name of Director	Ausgold Shares	Unlisted Options
R Lockwood	25,775,392	7,500,000
D Rakich	12,224,571	7,500,000
N Fearis	1,428,571	-
G Jones	1,000,000	-

(f) If all of the Options to be issued pursuant to Resolutions 6, 7, 8 and 9 were to be exercised, existing Shareholders’ interests in the Company would be diluted by approximately 4.65%, assuming no other Shares were issued (including by way of exercise of existing Options) prior to the exercise of those Options.

(g) There is no other information known to the Directors of the Company that is reasonably required by Shareholders in order to make a decision regarding whether or not it is in the Company’s interests to pass Resolutions 6, 7, 8 and 9.

Board Recommendation

Each of Mr Lockwood, Mr Rakich, Mr Fearis and Mr Jones abstains from making a recommendation to Shareholders in relation to Resolutions 6, 7, 8 and 9 respectively in view of their personal interest in the outcome of those Resolutions but recommends that Shareholders vote in favour of those Resolutions in the outcome of which they respectively do not have a personal interest..

8. RESOLUTION 10 - ADDITIONAL 10% PLACEMENT FACILITY

General

ASX Listing Rule 7.1A enables eligible entities to issue Equity Securities up to 10% of its issued share capital through placements over a 12 month period after the AGM ( Additional Placement Facility ). The Additional Placement Facility is in addition to the Company’s 15% placement capacity under Listing Rule 7.1.

For the purposes of Listing Rule 7.1A an eligible entity is one that, as at the date of the relevant annual general meeting:

• (a) is not included in the A&P/ASX300 index; and

• (b) has a market capitalisation of less than $300 million.

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

12

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

The Company is an eligible entity as at the time of this Explanatory Memorandum and is expected to be an eligible entity as at the time of the Annual General Meeting.

The Company is now seeking Shareholder approval by way of a special resolution to have the ability to issue Equity Securities under the Additional Placement Facility. The exact number of Equity Securities to be issued under the Additional Placement Facility will be determined in accordance with the formula prescribed in ASX Listing Rule 7.1A.2 (as set out below).

The effect of shareholders approving Resolution 9 will be to allow the Company to issue Equity Securities under Listing Rule 7.1A in addition to the Company’s 15% placement capacity under Listing Rule 7.1.

Resolution 10 is a special resolution, accordingly at least 75% of votes cast by Shareholders eligible to vote at the Annual General Meeting must be in favour of Resolution 10 for it to be passed.

Regulatory Requirements

In compliance with the information requirements of Listing Rule 7.3A, Shareholders are advised of the following information:

• (a) Minimum Issue Price

Equity securities issued under the Additional 10% Placement Facility must be in the same class as an existing class of quoted Equity Securities of the Company. As at the date of this Notice of Annual General Meeting, the Company has on issue one class of quoted Equity Securities, being Shares.

The issue price of Equity Securities issued under the Additional 10% Placement Facility must not be lower than 75% of the volume weighted average price for securities in the same class calculated over the 15 trading days on which trades in that class were conducted immediately before:

• (i) the date on which the Equity Securities are issued; or

• (ii) the date on which the price of Equity Securities is agreed, provided that the issue is thereafter completed within 5 business days.

• (b) Dilution

As at the date of this Notice of Annual General Meeting, the Company has 327,500,807 Shares on issue. Accordingly, if Shareholders approve Resolution 10, the Company will have the capacity to issue approximately 32,750,080 Equity Securities under the Additional 10% Placement Facility in accordance with Listing Rule 7.1A.

The precise number of Equity Securities that the Company will have capacity to issue under Listing Rule 7.1A will be calculated at the date of issue of the Equity Securities in accordance with the following formula:

(A x D) – E

• A is the number of fully paid shares on issue 12 months before the date of issue or agreement:

• (A) plus the number of fully paid shares issued in the 12 months under an exception in Listing Rule 7.2;

• (B) plus the number of partly paid shares that became fully paid in the 12 months;

• (C) plus the number of fully paid shares issued in the 12 months with approval of holders of shares under Listing Rule 7.1 and 7.4;

• (D) less the number of fully paid shares cancelled in the 12 months.

Note that A is has the same meaning in Listing Rule 7.1 when calculating an entity's 15% placement capacity.

D is 10%

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

13

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

• E is the number of Equity Securities issued or agreed to be issued under Listing Rule 7.1A.2 in the 12 months before the date of the issue or agreement to issue that are not issued with the approval of shareholders under Listing Rule 7.1 or 7.4.

If Resolution 10 is approved by Shareholders and the Company issues Equity Securities under the Additional 10% Placement Facility, existing Shareholders' voting power in the Company will be diluted as shown in the table below. There is a risk that:

• (i) the market price for the Company's Equity Securities may be significantly lower on the date of the issue of the Equity Securities than on the date of the Annual General Meeting; and

• (ii) the Equity Securities may be issued at a price that is at a discount to the market price for the Company's Equity Securities on the issue date or the Equity Securities are issued as part of consideration for the acquisition of a new asset,

which may have an effect on the amount of funds raised by the issue of the Equity Securities.

The below table shows the dilution of existing Shareholders on the basis of the current market price of Shares and the current number of ordinary securities for variable "A" calculated in accordance with the formula in Listing Rule 7.1A(2) as at the date of this Notice of Annual General Meeting.

The table also shows:

• (i) two examples where variable “A” has increased, by 50% and 100%. Variable “A” is based on the number of ordinary securities the Company has on issue. The number of ordinary securities on issue may increase as a result of issues of ordinary securities that do not require Shareholder approval (for example, a pro rata entitlements issue or scrip issued under a takeover offer) or future specific placements under Listing Rule 7.1 that are approved at a future Shareholders’ meeting; and

• (ii) two examples of where the issue price of ordinary securities has decreased by 50% and increased by 50% as against the current market price.

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

14

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

Variable “A” in Listing Rule 7.1A.2			Dilution
		$0.0215 50% decrease in Issue Price	$0.043 Issue Price	$0.086 100% increase in Issue Price
Current Variable A 327,500,807 Shares	Shares issued (10% Voting Dilution)	32,750,080 New Shares	32,750,080 New Shares	32,750,080 New Shares
	Funds raised	$704,126	$1,408,253	$2,816,506
50% increase in current Variable A 491,251,210 Shares	Shares issued (10% Voting Dilution)	49,125,121 New Shares	49,125,121 New Shares	49,125,121 New Shares
	Funds raised	$1,056,190	$2,112,380	$4,224,760
100% increase in current Variable A 655,001,614 Shares	Shares issued (10% Voting Dilution)	65,500,161 New Shares	65,500,161 New Shares	65,500,161 New Shares
	Funds raised	$1,408,253	$2,816,507	$5,633,013

The table has been prepared on the following assumptions:

1. Variable A is 327,500,807 being the number of ordinary securities on issue at the date of this Notice of Meeting.

2. The Company issues the maximum number of Equity Securities available under the Additional 10% Placement Facility.

3. No Options are exercised into Shares before the date of issue of the Equity Securities.

4. The Company has not issued any other Equity Securities using its placement capacity under Listing Rule 7.1 or 7.1A in the 12 months preceding this Notice of Meeting.

5. The 10% voting dilution reflects the aggregate percentage dilution against the issued share capital at the time of issue. This is why the voting dilution is shown in each example as 10%.

6. The table does not show an example of dilution that may be caused to a particular Shareholder by reason of placements under the Additional 10% Placement Facility, based on that Shareholder’s holding at the date of the Meeting. All Shareholders should consider the dilution caused to their own shareholding depending on their specific circumstances.

7. The table shows only the effect of issues of Equity Securities under Listing Rule 7.1A, not under the 15% placement capacity under Listing Rule 7.1.

8. The issue of Equity Securities under the Additional 10% Placement Facility consists only of Shares.

9. The issue price is $0.043, being the closing price of the Shares on ASX on 4 October 2016.

10. (c) Issue Period

If Shareholders approve Resolution 10, the Company will have a mandate to issue Equity Securities under the Additional 10% Placement Facility under Listing Rule 7.1A from the date of the Annual General Meeting until the earlier of the following to occur:

• (i) the date that is 12 months after the date of the Annual General Meeting; and

• (ii) the date of the approval by Shareholders of a transaction under Listing Rule 11.1.2 (a significant change to the nature or scale of activities) or 11.2 (disposal of main undertaking), (the Additional 10% Placement Period).

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

15

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

The Company will only issue and allot Equity Securities during the Additional 10% Placement Period.

(d) Purpose of Issues

The Company may seek to issue the Equity Securities for the following purposes:

• (i) non-cash consideration for the acquisition of new assets or investments. Whilst at the date of this Explanatory Memorandum, the Board has no present intention to acquire new assets or investments, should the Company propose to do so in future, the Company will provide a valuation of the non-cash consideration as required by Listing Rule 7.1A.3; or

• (ii) cash consideration. In such circumstances, the Company intends to use the funds raised for the Company’s exploration and development programs at the Katanning Gold Project and to provide additional working capital.

The Company will provide further information at the time of issue of any Equity Securities under the Additional 10% Placement Facility in compliance with its disclosure obligations under Listing Rules 7.1A.4 and 3.10.5A.

(e) Allocation Policy

The Company’s allocation policy is dependent on the prevailing market conditions at the time of any proposed issue pursuant to the Additional 10% Placement Facility. The identity of the allottees of Equity Securities will be determined on a case-by-case basis having regard to the factors including but not limited to the following:

• (i) the methods of raising funds that are available to the Company, including but not limited to, rights issue or other issues in which existing security holders can participate;

• (ii) the effect of the issue of the Equity Securities on the control of the Company;

• (iii) the financial situation and solvency of the Company; and

• (iv) advice from corporate, financial and broking advisers (if applicable).

The allottees under the Additional 10% Placement Facility have not been determined as at the date of this Notice but may include existing substantial Shareholders and/or new Shareholders who are not related parties or associates of a related party of the Company.

Further, if the Company is successful in acquiring new resources assets or investments, it is likely that the allottees under the 10% Placement Facility will be the vendors of the new resources assets or investments.

• (f) Previous issues of Equity Securities under Listing Rule 7.1A The Company has not previously obtained Shareholder approval under Listing Rule 7.1A and accordingly has not issued any Equity Securities pursuant to Listing Rule 7.1A in the 12 months preceding the date of the Annual General Meeting.

• (g) Voting exclusion statement

A voting exclusion statement for Resolution 10 is included in the Notice of Annual General Meeting preceding this Explanatory Statement.

At the date of the Notice of Annual General Meeting, the Company has not approached any particular existing security holder or an identifiable class of existing security holders to participate in the issue of the Equity Securities. No existing Shareholder's votes will therefore be excluded under the voting exclusion in the Notice of Annual General Meeting.

In these circumstances (and in accordance with the note set out in ASX Listing Rule 14.11.1 relating to ASX Listing Rules 7.1 and 7.1A), for a person’s vote to be excluded, it must be known that that person will participate in the proposed issue. Where it is not known who will participate in the

NOTICE OF ANNUAL GENERAL MEETING

16

11 NOVEMBER 2016

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

proposed issue (as is the case in respect of any Equity Securities issued under the Additional 10% Placement Facility), Shareholders must consider the proposal on the basis that they may or may not get a benefit and that it is possible that their holding will be diluted, and there is no reason to exclude their votes.

No existing Shareholder's votes will therefore be excluded under the voting exclusion in the Notice of Annual General Meeting.

Board Recommendation

The Board believes that the Additional 10% Placement Facility is beneficial for the Company as it will give the Company the flexibility to issue further securities representing up to 10% of the Company’s share capital during the next 12 months. Accordingly, the Board unanimously recommend that Shareholders approve Resolution 10.

9. ACTION TO BE TAKEN BY SHAREHOLDERS

Shareholders should read this Explanatory Memorandum carefully before deciding how to vote on the resolutions set out in the Notice of Meeting.

Attached to the Notice of Meeting is a Proxy Form for use by shareholders. All shareholders are invited and encouraged to attend the AGM or, if they are unable to attend in person, to complete, sign and return the Proxy Form to the Company in accordance with the instructions contained in the Proxy Form and the Notice of Meeting. Lodgement of a Proxy Form will not preclude a shareholder from attending and voting at the AGM in person.

10. GLOSSARY

The following terms and abbreviations used in this Explanatory Memorandum have the following meanings:

$	means Australian Dollars.
ActorCorporations Act	means the_Corporations Act 2001_(Cth).
Additional 10% Placement Facility	Has the meaning given in Section 8 of the Explanatory
	Memorandum
AGMorGeneral Meeting	the annual general meeting of the Company to be held on
	11 November 2016.
ASIC	Australian Securities and Investments Commission.
Associate	Has the meaning given to it by Division 2 of Part 1.2 of the
	Corporations Act.
ASX	ASX Limited (ACN 008 624 691).
ASX Listing RulesorListing Rules	the Official Listing Rules of ASX, as amended from time to
	time.
Board	the 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.

Chairperson

the person appointed to chair the Meeting convened by

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

17

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

the Notice.

Closely Related Party

means:

• (a) a spouse or child of the member;

• (b) a child of the member's spouse;

• (c) a dependent of the member or the member's spouse;

• (d) anyone else who is one of the member's family and may be expected to influence the member or be influenced by the member, in the member's dealing with the entity;

• (e) a company the member controls; or

• (f) a person prescribed by the Corporations Regulations 2001 (Cth).

Company or Ausgold Ausgold Limited (ABN 67 140 164 496). Constitution means the Company’s constitution. Corporations Regulations Corporations Regulations 2001 (Cth) as amended from time to time. Equity Securities includes a Share, a right to a Share or Option, an Option, a convertible security and any security that ASX decides to classify as an Equity Security. Explanatory Memorandum the explanatory memorandum which accompanies and forms part of the Notice of Meeting. Grant Date the date the Option is issued, being within one month after the date of the AGM. Key Management Personnel has the same meaning as in the accounting standards and, broadly, includes those persons having authority and responsibility for planning, directing and controlling the activities of the Company, directly or indirectly, including any director (whether executive or otherwise) of the Company.

Notice of Meeting the notice convening the AGM which accompanies this Explanatory Memorandum. Option an option to subscribe for a Share, exercisable at 8 cents. each and expiring on 30 November 2020. Option holder a holder of an Option. Proxy Form the proxy form which accompanies this Explanatory Memorandum.

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

18

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

Shares or Ausgold Shares fully paid ordinary shares in the Company. Shareholder a registered holder of a share.

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

19

017-8145-5327/1/AUSTRALIA

==> picture [45 x 24] intentionally omitted <==

APPENDIX ‘A’– TERMS AND CONDITIONS OF OPTIONS

1. Each Option entitles the holder to subscribe for and be allotted one Share at the exercise price of the Options being 8 cents each (the Exercise Price ).

2. The Options are exercisable at any time prior to 5:00pm (Perth time) on 30 November 2020 (the Expiry Date ). The Options are exercisable by notice in writing to the Company accompanied by payment of the Exercise Price.

3. The Options are not transferable but no application will be made to ASX for Official Quotation of the Options.

4. Shares will be allotted and issued pursuant to the exercise of Options not more than 10 business days after receipt of a properly executed notice of exercise and payment of the requisite application moneys.

5. Shares issued upon exercise of the Options will rank pari passu in all respects with Company’s fully paid ordinary shares. The Company will apply for Official Quotation by ASX of all shares issued upon the exercise of Options within 3 business days after the date of allotment of those shares.

6. There are no participating rights or entitlements inherent in the Options and holders will not be entitled to participate in new issues of capital offered or made to the Shareholders during the currency of the Options. However, the Company will send a notice to each Option holder at least 10 business days before the record date for any proposed issue of capital. This will give Option holders the opportunity to exercises their Options prior to the date for determining entitlements to participate in any such issue.

7. There are no rights to a change in the Exercise Price, or in the number of shares over which the Options can be exercised, in the event of a pro rata issue or a bonus issue by the Company prior to the exercise of any Options.

8. In the event of any re-organisation of the issued capital of the Company on or prior to the Expiry Date, the rights of an Option holder will be changed to the extent necessary to comply with the applicable ASX Listing Rules at the time of the re-organisation.

9. The Company will, at least 20 business days before the Expiry Date, send notices to the Option holders containing the information required under the ASX Listing Rules then applicable.

NOTICE OF ANNUAL GENERAL MEETING 11 NOVEMBER 2016

20

017-8145-5327/1/AUSTRALIA

==> picture [44 x 24] intentionally omitted <==

PROXY FORM

The Company Secretary Ausgold Limited Level 16, AMP Building 140 St Georges Terrace PERTH WA 6000

I/We ……………………………………………………………………………………………………………………………………………………………………………………………..

(Full Name – Block Letters)

of ……………………………………………………………………………………………………………………………………………………………………………………………………

being a member of Ausgold Limited hereby appoint

…………………………………………………………………………………………………………………….. to exercise ………………………% of my/our voting rights (Name of 1[st] Proxy)

………………………………………………………………………………………………………………………. to exercise ………………………% of my/our voting rights

(2[nd] Proxy – Optional)

or in his/her absence, or if no person is named, the Chairman of the meeting as my/our proxy/proxies to act generally and vote on my/our behalf at the AGM of the Company to be held at 11.00am on Friday 11 November 2016 and at any adjournment thereof in accordance with this Proxy Form.

The Chairman of the meeting will act as your proxy if you do not appoint someone. It is the Chairman’s intention to exercise all undirected proxies in favour of all of the resolutions.

If the Chairman is appointed as your proxy (either expressly or by default) and you do not wish to direct your proxy how to vote, please place a mark in this box 

By marking the box above you acknowledge that if you have appointed the Chairman as your proxy (either expressly or by default):

(1) he may exercise the undirected proxy even if he has an interest in the outcome of resolutions 4, 6, 7, 8 and 9 votes cast by him other than as proxy would be disregarded because of that interest; and

• (2) he is expressly authorised to exercise the undirected proxy in respect of resolutions 4, 6, 7, 8 and 9 in the manner described above even though resolution 4 is connected with the remuneration of a member of the Key Management Personnel.

If you do not mark the box above, and you have not directed your proxy how to vote, then in respect of resolutions 4 and 8 the Chairman will not cast your votes and your votes will not be counted in calculating the required majority if a poll is called on those resolutions.

	RESOLUTIONS	FOR	AGAINST	*ABSTAIN **
1.	To re-elect Mr Richard Lockwood as a director			
2.	To re-elect Mr Neil Fearis as a director			
3.	To re-elect Mr Geoffrey Jones as a director			
4.	Adoption of remuneration report			
5.	Ratify allotment of shares			
6.	Issue of options to Mr Lockwood			
7.	Issue of options to Mr Rakich			
8.	Issue of options to Mr Fearis			
9.	Issue of options to Mr Jones			
10.	Approval of Additional 10% Placement Facility			

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

Date:……….…………………………………….2016.

………………………………………………………………… ………………………………………………………………………… Signature of Member Signature of Joint Member

Or if a company: THE COMMON SEAL OF …………………………………………. ) was affixed in the presence of, and the sealing is attested by: )

………………………………………………………………… ……………………………………..…………………………………… Director/Secretary Director

Or if a company with no common seal: EXECUTED by authority of its directors

……………………………………………………………….. ………………………………………………………….

Director / Company Secretary

Director

017-8145-5327/1/AUSTRALIA

INSTRUCTIONS FOR APPOINTMENT OF PROXY

• (1) A member entitled to attend and vote at the meeting is entitled to appoint not more than two proxies.

• (2) Where more than one proxy is appointed, each proxy must be appointed to represent a specified proportion of the member's voting rights. If that proportion is not specified, each proxy may exercise one-half of the member’s voting rights.

• (3) A proxy need not be a member of the Company.

Forms to appoint proxies and the Power of Attorney (if any) under which it is signed or an office copy or notarially certified copy thereof must be deposited with the Company at the registered office, Level 16, AMP Building, 140 St Georges Terrace, Perth WA 6000 or faxed to the Company (Fax No: (08) 9220 9820 and for overseas shareholders: (618) 9220 9820), not less than 48 hours before the time for holding the meeting. A proxy presented by a company should be under the common seal of that company.

017-8145-5327/1/AUSTRALIA