AUSGOLD LIMITED — Proxy Solicitation & Information Statement 2014

Jul 10, 2014

11 July 2014

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ASX Announcement

DESPATCH OF NOTICE OF GENERAL MEETING

Attached is a copy of a Notice of General Meeting, Explanatory Memorandum and Proxy Form for a General Meeting of the shareholders of Ausgold Limited to be held on Tuesday, 12 August 2014.

This information has been despatched to shareholders today.

*ENDS***

For further information, shareholders and media please contact:

Mr Denis Rakich Director Ph: (08) 9220 9882

ABN: 67 140 164 496 Level 16, AMP Building, 140 St Georges Terrace, Perth WA 6000 T: 08 9220 9890 F: 08 9220 9820 E: info@ausgoldlimited.com W: www.ausgoldlimited.com

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AUSGOLD LIMITED (ABN 67 140 164 496)

CIRCULAR TO SHAREHOLDERS

INCLUDING

NOTICE OF GENERAL MEETING EXPLANATORY MEMORANDUM PROXY FORM

Date of Meeting 12 August 2014

Time of Meeting 10.00am (AWST)

Place of Meeting 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

AUSGOLD LIMITED Notice of General Meeting 12 August 2014

AUSGOLD LIMITED (ABN 67 140 164 496)

NOTICE OF GENERAL MEETING

NOTICE IS HEREBY GIVEN that a general meeting of Ausgold Limited will be held at Level 1, AMP Building, 140 St Georges Terrace, Perth WA 6000 on Tuesday 12 August 2014 at 10.00 am (AWST) to conduct the following business and to consider, and if thought fit, to pass the following Resolutions.

Defined terms used in this Notice and Explanatory Memorandum have the meaning given in the Glossary.

AGENDA

ORDINARY BUSINESS

RESOLUTION 1 – SUBSEQUENT APPROVAL OF APPOINTMENT OF A DIRECTOR

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

“That pursuant to the power under Clause 56.3 of the Constitution, the appointment of Mr Stephen Thomas as a Director of the Company is hereby approved by the Company.”

RESOLUTION 2- ISSUE OF OPTIONS TO STEPHEN THOMAS

“Subject to the passing of Resolution 1, 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 3,500,000 Options to Stephen Thomas 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 2 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:

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 2 by or on behalf of:

• (a) any of the entities referred to in Section 3 of the Explanatory Memorandum;

• (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 2 is passed; and

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

However, a person described above may cast a vote on this Resolution if:

• (d) the person does so as a proxy appointed by writing that specifies how the proxy is to vote on the Resolution; and

• (e) the vote is not cast on behalf of a person described in sub-paragraphs (a), (b) or (c) above.

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AUSGOLD LIMITED Notice of General Meeting 12 August 2014

RESOLUTION 3 - ISSUE OF OPTIONS TO DENIS RAKICH

“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 3,500,000 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 3 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:

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 3 by or on behalf of:

• (a) any of the entities referred to in Section 3 of the Explanatory Memorandum;

• (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 3 is passed; and

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

However, a person described above may cast a vote on this Resolution if:

• (d) the person does so as a proxy appointed by writing that specifies how the proxy is to vote on the Resolution; and

• (e) the vote is not cast on behalf of a person described in sub-paragraphs (a), (b) or (c) above.

RESOLUTION 4 - 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 3,500,000 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 4 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 this issue.

• (3) Voting Exclusion:

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 4 by or on behalf of:

• (a) any of the entities referred to in Section 3 of the Explanatory Memorandum;

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AUSGOLD LIMITED Notice of General Meeting 12 August 2014

• (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 4 is passed; and

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

However, a person described above may cast a vote on this Resolution if:

• (d) the person does so as a proxy appointed by writing that specifies how the proxy is to vote on the Resolution; and

• (e) the vote is not cast on behalf of a person described in sub-paragraphs (a), (b) or (c) above.

RESOLUTION 5 - ISSUE OF OPTIONS TO ROBERT PETT

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 3,500,000 Options to Robert Pett, 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 5 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:

In accordance with Listing Rule 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 5 by or on behalf of:

• (a) any of the entities referred to in Section 3 of the Explanatory Memorandum;

• (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 5 is passed; and

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

However, a person described above may cast a vote on this Resolution if:

• (d) the person does so as a proxy appointed by writing that specifies how the proxy is to vote on the Resolution; and

• (e) the vote is not cast on behalf of a person described in sub-paragraphs (a), (b) or (c) above.

VOTING AND PROXIES

1. Voting entitlements

In accordance with Regulation 7.11.38 of the Corporations Regulations 2001, the Company determines that shares held as at 10.00 am on 10 August 2014 will be taken, for the purposes of the General Meeting, to be held by the persons who held them at that time.

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AUSGOLD LIMITED Notice of General Meeting 12 August 2014

2. How to vote

You may vote by attending the General Meeting in person, by proxy, or by an authorised representative.

3. Voting in person

To vote in person, attend the General Meeting on the date and at the place set out above. Shareholders are asked to arrive at the venue 30 minutes prior to the time designated for the meeting, if possible, so that the Company may check their shareholding against the Company’s share register and note attendances.

4. Voting by proxy

In accordance with Section 249L of the Corporations Act, Shareholders are advised that:

• Each Shareholder 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 Shareholder 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 proxy need not be a Shareholder of the Company.

• A proxy can be an individual or a body corporate.

• A body corporate appointed as a Shareholder's proxy may appoint a representative to exercise any of the powers the body corporate may exercise as a proxy at the General Meeting.

• The representative should bring to the meeting evidence of his or her appointment, including any authority under which the appointment is signed, unless it has previously been given to the Company.

• A body corporate appointed as a Shareholder's proxy may appoint a representative to exercise any of the powers the body corporate may exercise as a proxy at the General Meeting.

• A Shareholder 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, each proxy may exercise one-half of the votes. Factions of votes will be disregarded.

• Where a Shareholder appoints more than one proxy, neither proxy is entitled to vote on a show of hands.

• A proxy may decide whether to vote on any motion, except where the proxy is required by law or the Constitution to vote, or abstain from voting, in their capacity as proxy. If a proxy is directed how to vote on an item of business, the proxy may vote on that item only in accordance with the direction. If a proxy is not directed how to vote on an item of business, the proxy may vote as he or she thinks fit.

• If a Shareholder appoints the Chairperson of the Meeting as the Shareholder's proxy and does not specify how the chairperson is to vote on an item of business, the chairperson will vote, as proxy for that Shareholder, in favour of that item on a poll.

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AUSGOLD LIMITED Notice of General Meeting 12 August 2014

To vote by proxy, the Proxy Form (together with the original of any power of attorney or other authority, if any, or certified copy of that power of attorney or other authority under which the Proxy Form is signed) attached to this Notice must be deposited with the Company at either of the following:

Registered Office:

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

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).

Corporate representatives

A body corporate may elect to appoint an individual to act as its representative in accordance with Section 250D of the Corporations Act, in which case the Company will require a certificate of appointment of the corporate representative executed in accordance with the Corporations Act. The certificate of appointment must be lodged with the Company and/or the Company’s share registry on the day of the General Meeting.

By Order of the Board

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D I Rakich Company Secretary

27 June 2014

The Notice of Meeting, Explanatory Memorandum and Proxy Form 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.

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AUSGOLD LIMITED Notice of General Meeting 12 August 2014

(ABN 67 140 164 496)

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EXPLANATORY MEMORANDUM TO SHAREHOLDERS

1. INTRODUCTION

This Explanatory Memorandum has been prepared for the information of Shareholders of Ausgold Limited in connection with the business to be transacted at the General Meeting of the Company to be held on Tuesday 12 August 2014.

At that General Meeting, Shareholders will be asked to consider resolutions:

• to approve appointment of a Director; and

• to approve the issue of Options to Directors.

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.

Details of these proposals are set out in the Explanatory Memorandum, which Shareholders are encouraged to read carefully and in conjunction with the accompanying Notice of Meeting.

2. GLOSSARY

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

ActorCorporations Act	Corporations Act 2001(Cth) as amended from time to
	time.
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), or the stock exchange
	conducted by ASX, as the context requires.
ASX Listing RulesorListing Rules	The Official Listing Rules of ASX, as amended from time to
	time.
Board	The board of Directors of the Company.
Chairperson	The person appointed to chair the Meeting convened by
	the Notice.
CompanyorAusgold	Ausgold Limited (ABN 67 140 164 496).
Constitution	The constitution of the Company, as amended from time
	to time.

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AUSGOLD LIMITED Notice of General Meeting 12 August 2014

Corporations Regulations	Corporations Regulations 2001(Cth) as amended from
	time to time.
Directors	The Directors of the Company, from time to time.
EGM	The extraordinary general meeting of the Company to be
	convened under the Notice of Meeting to be held on 12
	August 2014.
Equity Securities	Has the same meaning as set out in the Listing Rules.
Explanatory Memorandum	The explanatory memorandum which accompanies and
	forms part of the Notice of Meeting.
General Meeting or Meeting	The general meeting of the Company to be held on 12
	August 2014.
Grant Date	The date the Option is issued, being within one month
	after the date of the EGM.
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 (whether directly or indirectly),
	and includes any director (whether executive or
	otherwise) of the Company.
NoticeorNotice of Meeting	The notice convening the EGM which accompanies this
	Explanatory Memorandum.
Option	An option to subscribe for a Share, exercisable at 9 cents
	each and expiring on 31 January 2017.
Optionholder	A holder of an Option.
Proxy Form	The proxy form which accompanies this Explanatory
	Memorandum.
Resolution	A resolution referred to in the Notice of Meeting.
ShareorAusgold Share	A fully paid ordinary share in the capital of the Company.
Shareholder	A registered holder of a Share.

3. RESOLUTION 1 – APPROVE APPOINTMENT OF MR STEPHEN THOMAS AS A DIRECTOR

Background

Mr Stephen Thomas, having consented by notice in writing to act as a Director, was appointed to the Board on 27 June 2014 pursuant to the Board’s power under Clause 57.1 of the Constitution.

A profile of Mr Thomas is contained in Appendix B to this Explanatory Memorandum.

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AUSGOLD LIMITED Notice of General Meeting 12 August 2014

It is noted that the Board has the power to appoint a new Director to either fill a casual vacancy or add to the existing Directors of the Company by appointing a new director to the Board (Clause 57.1 of the Constitution) ( Appointment Powers ). Pursuant to Clause 57.1 of the Company’s Constitution, a Director appointed in accordance with the Appointment Powers holds office until the end of the next annual general meeting of the Company.

In lieu of the next annual general meeting of the Company, the Company seeks to approve the appointment of Mr Stephen Thomas as a Director in general meeting pursuant to Clause 56.3 of the Company’s Constitution. It is noted that Clause 56.3 of the Constitution provides that, subject to the other provisions of the Constitution, the Company may appoint a person as a Director of the Company by resolution passed in general meeting.

It is noted that a Director appointed by the Company in general meeting will be subject to the retirement by rotation provisions under Clause 58 of the Constitution.

Directors’ recommendation

The Board unanimously recommends that Shareholders vote in favour of Resolution 1.

4. ISSUE OF OPTIONS TO DIRECTORS

Background

The Company proposes to issue Options each to Mr Lockwood, Mr Pett, Mr Rakich and Mr Thomas, each Directors of the Company, in the following proportions:

Name of Director	Options
S Thomas	3,500,000
D Rakich	3,500,000
R Lockwood	3,500,000
R Pett	3,500,000

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

In respect of Resolutions 4 and 5, the purpose of the issue of Options to Mr Lockwood and Mr Pett is to recognise and reward the non-executive Directors' efforts to date on the Company’s behalf as well as to align their interests with those of the Shareholders and to provide these Directors with an additional incentive to continue their efforts for the benefit of the Company.

The Directors have decided to suspend and cancel all accrued non-executive Directors fees owing. Funds for payment of non-executive Directors fees will now be utilised for the funding of future exploration and drilling programmes for the Company. In lieu of the non-payment of accrued Directors fees, Shareholders are being asked to approve the issue of the Options. Accrued Directors’ fees owing to Mr Pett are $109,012 and to Mr Lockwood are $50,000. These accrued fees will be cancelled in consideration for the issue of Options contemplated by Resolutions 4 and 5 respectively.

In respect of Resolutions 2 and 3, the purpose of the issue of Options to Mr Thomas and Mr Rakich is to align their interests with those of the Shareholders and to provide sufficient incentives to continue their efforts for the benefit of the Company.

The Options form part of the Directors’ remuneration packages which, in addition to the Options, are as follows:

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AUSGOLD LIMITED Notice of General Meeting 12 August 2014

Name of Director	Position	Salary/Fees
		& Superannuation
S Thomas	Executive Technical Director	$110,000
D Rakich	Executive Director	$110,000
R Lockwood	Non-executive	$Nil
R Pett	Non-executive	$Nil

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 4 to 5 to be reasonable in the circumstances given the Company's size and stage of development and the necessity to attract and retain professionals to the role, whilst conserving the Company's cash reserves.

Each Option is exercisable at a price of 9 cents and expires on 31 January 2017.

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 no consideration and consequently no funds will be raised by the issue. A total of $1,260,000 in additional share capital would be raised if all of the Options were exercised in full and assuming the exercise price is 9 cents per Option.

Reason for Shareholder approval under Listing Rules

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 2, 3, 4 and 5 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:

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

• (b) The total number of Options to be issued under Resolutions 2, 3, 4 and 5 is 14,000,000.

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

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AUSGOLD LIMITED Notice of General Meeting 12 August 2014

• (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.

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 2, 3, 4 and 5, 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 2, 3, 4 and 5 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 the Resolutions would permit a financial benefit to be given are Mr Thomas, Mr Rakich Mr Lockwood and Mr Pett, 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 2, 3, 4 and 5.

• (c) Based on a Binomial Option Pricing Model valuation method, the Company estimates that, as at 26 June 2014, the Options had a value per Option of $0.0276, giving a total value for the Options to be issued of $96,600 (for Mr Thomas), $96,600 (for Mr Rakich), $96,600 (for Mr Lockwood) and $96,600 (for Mr Pett).

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AUSGOLD LIMITED Notice of General Meeting 12 August 2014

The key assumptions used in arriving at the valuation were:

Exerciseprice	:	9 cents
Expirydate	:	31 January2017
Volatilityfactor	:	103.04%
Shareprice	:	$0.05
Risk-free interest rate	:	2.48%
Dividendyield	:	-

• (d) Over the last 12 months, the highest recorded sale price of Ausgold Shares in trading on the ASX was $0.081 (on 7 March 2014), and the lowest recorded sale price was $0.01 (on 19 December 2013). The last recorded sale price of Ausgold Shares before the date of this Explanatory Memorandum was $0.05.

• (e) The Directors have relevant interests in Ausgold securities as follows:

Name of Director	Ausgold Shares	Listed Options	Unlisted Options
S Thomas	10,000,000	10,000,000	-
D Rakich	11,286,000	3,748,000	-
R Lockwood	9,990,226	3,330,075	500,000
R Pett	12,450,000	4,150,000	-

• (f) If all of the Options to be issued pursuant to Resolutions 2, 3, 4 and 5 were to be exercised, existing Shareholders’ interests in the Company would be diluted by approximately 5.7%, assuming no other Shares were issued (including by way of exercise of existing Options) prior to the exercise of those Options.

• (g) Each of Mr Thomas, Mr Rakich, Mr Lockwood and Mr Pett abstain from making a recommendation to Shareholders in relation to Resolutions 2, 3, 4 and 5 respectively in view of their personal interest in the outcome of those Resolutions.

• (h) Pursuant to Section 219 of the Corporations Act, 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 2, 3, 4 and 5.

5. 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 General Meeting 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 General Meeting in person.

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AUSGOLD LIMITED Notice of General Meeting 12 August 2014

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 9 cents each (the Exercise Price ).

2. The Options are exercisable at any time prior to 5:00pm (Perth time) on 31 January 2017 (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 Optionholder at least 10 business days before the record date for any proposed issue of capital. This will give Optionholders 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 reorganisation of the issued capital of the Company on or prior to the Expiry Date, the rights of an Optionholder will be changed to the extent necessary to comply with the applicable ASX Listing Rules at the time of the reorganisation.

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

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AUSGOLD LIMITED Notice of General Meeting 12 August 2014

APPENDIX ‘B’– DIRECTOR PROFILE OF STEPHEN THOMAS

Mr Thomas is a geologist and a member of the Australian Institute of Mining and Metallurgy (AusIMM). He spent 12 years as a senior mine geologist at various projects including the nickel and gold operations of Western Mining Corporation Limited.

Mr Thomas has worked for over 20 years in the mineral finance sector as a resource analyst with a variety of companies including Hartleys, Rothschild Golden Arrow Fund and Bell Potter Securities Ltd.

Mr Thomas has completed a Bachelor of Science degree at the Royal School of Mines, Imperial College, London (and is an Associate of the Royal School of Mines), and completed an MBA at the Cardiff Business School, University of Wales, UK.

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PROXY FORM

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

I/We …………………………………………………………………………………………………………………………………………………………………………………………….. (Full Name – Block Letters)

of …………………………………………………………………………………………………………………………………………………………………………………………………... being a Shareholder 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, the Chairperson of the meeting as my/our proxy/proxies to vote on my/our behalf at the General Meeting of the Company to be held at 10.00 am on Tuesday 12 August 2014 and at any adjournment thereof.

I/We understand that if I/we have not directed my/our proxy how to vote, my/our proxy may vote or abstain from voting as he thinks fit.

The Chairperson of the meeting will act as your proxy if you do not appoint someone. It is the Chairperson’s intention to exercise undirected proxies IN FAVOUR of all Resolutions.

In the case of Resolution 5, if the Chairman is appointed as your proxy (either expressly or by default), then he will cast your votes in favour of the resolution if you have not specifically directed him to vote against, or abstain from voting on, the resolution. If you wish to appoint the Chairman as your proxy but do not wish your votes to be cast in favour of Resolution 5, you must indicate your voting intention by marking either 'against' or 'abstain' against Resolution 5 below.

If the Chairperson 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 the box opposite. 

By marking this box you acknowledge that if you have appointed the Chairperson as your proxy, he may exercise the undirected proxy even if he has an interest in the outcome of the Resolutions and votes cast by him other than a proxy holder will be disregarded because of that interest.

If you do not mark this box, and you have not directed your proxy how to vote, then in respect of Resolution 5 the Chairperson will not cast your votes on the Resolution and your votes will not be counted in calculating the required majority if a poll is called on the Resolution.

Voting directions to your proxy - please mark only one of the boxes with an “X” for each Resolution to indicate your directions.

	RESOLUTIONS	FOR	AGAINST	*ABSTAIN **
1.	Subsequent approval of appointment of Mr Thomas a Director			
2.	Issue of Options to Mr Thomas			
3.	Issue of Options to Mr Rakich			
4.	Issue of Options to Mr Lockwood			
5.	Issue of Options to Mr Pett			

*** 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.**

Date:……….…………………………………….2014.

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

…………………………………… ……………………………………… Secretary Director

INSTRUCTIONS FOR APPOINTMENT OF PROXY

How to Vote on Items of Business

All your securities will be voted in accordance with your directions.

Appointment of Proxy

Voting 100% of your holding : Direct your proxy how to vote by marking one of the boxes opposite each item of business. If you do not mark a box your proxy may vote as they choose. If you mark more than one box on an item your vote will be invalid on that item.

Voting a portion of your holding : Indicate a portion of your voting rights by inserting the percentage or number of Shares you wish to vote in the For, Against or Abstain box or boxes. The sum of the votes cast must not exceed your voting entitlement or 100%.

Appointing a second proxy : You are entitled to appoint up to two proxies to attend the meeting and vote on a poll. If you appoint two proxies you must specify the percentage of votes or number of securities for each proxy, otherwise each proxy may exercise half of the votes. When appointing a second proxy write both names and the percentage of votes or number of securities.

A proxy need not be a Shareholder of the Company.

Signing Instructions for Postal Forms

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 form when you return it.

Companies: Where the company has a Sole Director who is also the Sole Company Secretary, this form must be signed by that person. If the company (pursuant to Section 204A of the Corporations Act 2001) does not have a Company Secretary, a Sole Director can also sign alone. Otherwise this form must be signed by a Director jointly with either another Director or a Company Secretary. Please sign in the appropriate place to indicate the office held. Delete titles as applicable.

Attending the Meeting

Bring this form to assist registration. If a representative of a corporate Shareholder or proxy is to attend the meeting you will need to provide the appropriate “Certificate of Appointment of Corporate Representative” to the Company prior to admission. A form of the certificate may be obtained from Security Transfer Registrars Pty Ltd or online at www.investorcentre.com under the information tab, "Downloadable Forms".

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 Meetin g. A proxy presented by a company Shareholder should be under the common seal of that company.