AUSTRALIAN VANADIUM LIMITED — AGM Information 2012

Nov 1, 2012

Yellow Rock Resources Limited ABN 90 116 221 740

Notice of Annual General Meeting

Explanatory Statement

and

Proxy Form

Date of Meeting Friday, 30 November 2012

Time of Meeting

10:00am (WST)

Place of Meeting AustAsia House

412 Newcastle Street, West Perth, WA 6005

YELLOW ROCK RESOURCES LIMITED ABN 90 116 221 740

NOTICE OF ANNUAL GENERAL MEETING

Notice is hereby given that the Annual General Meeting of members of Yellow Rock Resources Limited ( Yellow Rock or the Company ) will be held at 10:00am (WST) on Friday, 30 November 2012 at AustAsia House, 412 Newcastle Street, West Perth, Western Australia.

The accompanying Explanatory Statement forms part of this Notice of Annual General Meeting.

AGENDA

A. CONSIDERATION OF REPORTS

To receive and consider the Financial Statements for the year ended 30 June 2012, together with the reports by directors and auditors thereon.

B. ITEMS FOR APPROVAL

Financial Report (no resolution required)

A printed hard copy of the Annual Report, which includes the Financial Report, Directors’ Report and Auditor’s Report for the year ended 30 June 2012, has been sent to all Shareholders who requested it. The Annual Report is available on the Company’s website at www.yellowrock.com.au

There is no requirement for Shareholders to approve these reports. However, the Chairman will allow a reasonable opportunity for Shareholders to ask questions or make comments about those reports and the management of the Company.

Shareholders will also be given an opportunity to ask the Auditor or its representatives questions about the conduct of the audit and the preparation and content of the Auditor’s Report.

Resolution 1 – Adoption of Remuneration Report

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

“That the Remuneration Report included in the Annual Report for the financial year ended 30 June 2012 be adopted.”

Short Explanation : The vote on this resolution is advisory only and does not bind the Directors or the Company.

Resolution 2 – Re-election of Non-Executive Director (Mr Brenton Lewis)

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

“That, pursuant to clause 7.3(c) of the Constitution of the Company, Mr Brenton Lewis, who offers himself for re-election, having consented to act as a Non-Executive Director of the Company and being eligible, is hereby re-elected as a Non-Executive Director of the Company.”

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Yellow Rock Resources Limited

Short Explanation – Resolution 2 : Clauses 7.2 and 7.3 of the Constitution provide that the Directors may at any time appoint any person as a Director, either to fill a casual vacancy or as an addition to the existing Directors, and a Director so appointed must retire at the next Annual General Meeting of the Company following the appointment and is eligible for re-election at that Meeting.

Resolution 3 – Removal of Auditor and Appointment of Replacement Auditor

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

“That RSM Bird Cameron be and are hereby removed as the Company’s auditor, pursuant to section 329 of the Corporations Act and are hereby replaced by Abbott Solutions – Accountants & Auditors being duly qualified to act as auditor of the Company and having consented to act as auditor of the Company

Short Explanation – Resolution 3 : The Company is seeking the approval of Shareholders to remove RSM Bird Cameron as auditor and replace them with Abbott Solutions. Abbott Solutions – Accountants & Auditors are qualified to act as registered auditors of the Company and have consented to act. Quotations were received from 3 firms to provide audit services to the Company. Abbott Solutions was the best quote.

Resolution 3 is a special resolution. Accordingly, at least 75% of votes cast by Shareholders present and eligible to vote at the Meeting must be in favour of Resolution 3 for it to be passed.

Resolution 4 – Ratification of Prior Issue - 30 million Shares

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

“ That approval is given in accordance with Listing Rule 7.4 of ASX Limited for the issue and allotment on 15 June 2012 of 30,000,000 shares in Yellow Rock Resources as detailed in the Explanatory Statement.”

Short Explanation – Resolution 4: The issue of the 30 million shares was within the 15% annual limit permitted under the ASX Listing Rule 7.1 without shareholder approval. The effect of shareholders passing Resolution 4 will therefore be to restore the Company’s ability to issue securities within the limit.

No funds were raised from the issue. The Shares were issued as consideration for the acquisition of the tenement E51/1529.

Voting Exclusion - The Company will disregard any votes in respect of Resolution 4 if they are cast by any person who participated in the issue and any associates of those persons.

However, the Company need not disregard a vote if:

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

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

Resolution 5 – Issue of 30 million Options

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

“ That approval is given in accordance with Listing Rule 7.1 of ASX Limited for the issue and allotment of 30,000,000 options at an exercise price of $0.025 in Yellow Rock Resources as detailed in the Explanatory Statement.”

Short Explanation – Resolution 5: The issue of the 30 million options is in accordance with the ASX Listing Rule 7.1 as per Announcement on 28 May 2012.

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No funds were raised from the issue. The Options will be issued as consideration for the acquisition of the tenement E51/1529.

Voting Exclusion - The Company will disregard any votes in respect of Resolution 5 if they are cast by or on behalf of a person who may participate in the proposed issue and a person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities, if Resolution 5 is passed, and any associate of those persons.

However, the Company need not disregard a vote if:

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

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

Resolution 6 – Approval of and Extra 10% Placement Capacity

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

“That, for the purpose of Listing Rule 7.1A and for all other purposes, approval is given for the issue of Equity Securities totalling up to 10% of the Shares on issue (at the time of issue),, calculated in accordance with the formula prescribed in Listing Rule 7.1A.2 and on terms and conditions set out in the Explanatory Statement.”

Short Explanation – Resolution 6 : The effect of Resolution 6 will be to allow the Directors to issue Equity Securities up to 10% of the Company’s fully paid ordinary securities on issue during the period of up to 12 months after the Meeting, without seeking subsequent Shareholder approval, in addition to the Company’s 15% annual placement capacity granted under the Listing Rules..

Voting Exclusion – The Company will disregard any votes cast on this Resolution by any person who may participate in the issue of Equity Securities under this Resolution 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 will 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.

Voting at Annual General Meeting

The Directors have determined pursuant to Regulation 7.11.37 of the Corporations Regulations 2001 (Cth) that the persons eligible to vote at the Annual General Meeting are those who are registered Shareholders of the Company at 2012. Accordingly, transactions registered after that time will be disregarded in determining entitlements to attend and vote at the general meeting.

Proxy and Voting Entitlement Instructions are included on the Proxy Form accompanying this Notice of General Meeting.

Annual Report Online

Shareholders who have not elected to receive a hard copy of the Annual Report can access the report on the company’s website at www.yellowrock.com.au

BY ORDER OF THE BOARD

Simon Chesson Company Secretary

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Yellow Rock Resources Limited

EXPLANATORY STATEMENT

INTRODUCTION

This Explanatory Statement has been prepared for the information of the Shareholders in connection with the business to be conducted at the Annual General Meeting to be held at, AustAsia House, 412 Newcastle Street, West Perth, Western Australia on Friday, 30 November 2012 at 10:00am (WST).

This Explanatory Statement forms part of and should be read in conjunction with the accompanying Notice of Annual General Meeting.

FINANCIAL STATEMENTS AND REPORTS

As required by section 317 of the Corporations Act, the financial statements for the year ended 30 June 2012 and the reports of the Directors and auditors thereon will be laid before the meeting. There is no requirement for a formal resolution on this item.

In accordance with the Corporations Act, a reasonable opportunity will be given to Shareholders to ask questions and/or make comments on the management of the Company at the meeting.

As a Shareholder you are entitled to submit one written question to the auditor prior to the Annual General Meeting provided that the question relates to:

• The content of the auditor’s report; or

• The conduct of the audit in relation to the financial report.

All written questions must be sent to the Company and may not be sent direct to the auditor. The Company will then forward all questions to the auditor. The Company must receive questions no later than 5 business days before the date of the Annual General Meeting.

The auditor will be attending the Annual General Meeting and will be available to answer questions from Shareholders relevant to:

• The conduct of the audit;

• The preparation and content of the auditor’s report;

• The accounting policies adopted by the Company in relation to the preparation of the financial statements; and

• The independence of the auditor in relation to the conduct of the audit.

The auditor will also answer written questions submitted prior to the Annual General Meeting.

RESOLUTION 1 – ADOPTION OF REMUNERATION REPORT

The Company is required to include in its Directors Report a detailed Remuneration Report relating to Directors’ and executives’ remuneration. Section 300A of the Corporations Act sets out the information to be included in the Remuneration Report. The Remuneration Report is set out in the Directors Report section of Company’s 2012 Annual Report.

As required by section 250R(2) of the Corporations Act, a resolution that the remuneration report for the year ended 30 June 2012 be adopted is to be put to a vote. The vote on this item is advisory only and does not bind the Directors or the Company.

In accordance with section 250SA of the Corporations Act, shareholders will be provided with a reasonable opportunity to ask questions about, or make comments on, the Remuneration Report. This is in addition to any questions or comments that shareholders may have in relation to the management of the Company.

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RESOLUTION 2 - RE-ELECTION OF DIRECTOR

Resolution 2 relates to the election of a Director. Clause 7.2(b) of the Company’s Constitution states that the Directors may appoint any person as a Director of the company. Under clause 7.3(c) of the Constitution, Directors so appointed must retire at the next Annual General Meeting of the Company and are eligible for re-election at that Meeting.

Mr Brenton Lewis was appointed as a Non-Executive Director on 15 July 2010. In accordance with Clause 7.3(b) of the Constitution, offers himself for re-election as a Non-Executive Director of the Company.

A summary of the qualifications and experience of Mr Brenton Lewis is provided in the Annual Report.

RESOLUTION 3 – REMOVAL OF AUDITOR AND APPOINTMENT OF REPLACEMENT AUDITOR

Under section 329 of the Corporations Act, an auditor of a company may be removed from office by resolution at a general meeting of which 2 months notice of intention to move the resolution has been given. The notice of intention to remove RSM Bird Cameron is provided to Shareholders with this Notice of General Meeting.

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

The Company provides the notice of intention to Shareholders and seeks the approval to remove the auditor even though the meeting will be held less than 2 months after the notice of intention is given in Schedule 2 to this Notice.

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

If RSM Bird Cameron is removed under Resolution 3, the Directors propose that Abbott Solutions – Accountants & Auditors be appointed as the Company’s auditor effective from the Meeting. The notice of intention to remove RSM Bird Cameron as auditor of the Company and nomination of Abbott Solutions – Accountants & Auditors as auditor of the Company is provided to Shareholders in Schedule 2 to this Notice of General Meeting. Abbott Solutions – Accountants & Auditors have given written consent to act as the Company’s auditor in accordance with section 328A (1) of the Corporations Act.

If Resolutions 3 is passed, the appointment of Abbott Solutions – Accountants & Auditors as the Company’s auditor will take effect at the close of this General Meeting.

Directors’ Recommendation

The Board recommends Shareholders vote in favour of this Resolution.

RESOLUTION 4 – RATIFICATION OF PRIOR ISSUE – 30 MILLION SHARES

General

The Company has recently issued a total of 30,000,000 Shares at the at the date of allotment on 15 June 2012 was $0.018 per Share to acquire tenement E51/1529 as set out in the Announcement on 28 May 2012.

None of the subscribers pursuant to this issue were a related party of the Company.

Resolution 5 seeks Shareholder ratification pursuant to ASX Listing Rule 7.4 for the issue of those Shares (Ratification).

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Yellow Rock Resources Limited

ASX Listing Rule 7.1 provides that a company must not, subject to specified exceptions, issue or agree to issue during any 12 month period any equity securities, or other securities with rights to conversion to equity (such as an option), if the number of those securities exceeds 15% of the number of securities in the same class on issue at the commencement of that 12 month period.

ASX Listing Rule 7.4 sets out an exception to ASX Listing Rule 7.1. It provides that where a company in general meeting ratifies the previous issue of securities made pursuant to ASX Listing Rule 7.1 (and provided that the previous issue did not breach ASX Listing Rule7.1) those securities will be deemed to have been made with shareholder approval for the purpose of ASX Listing Rule 7.1.

By ratifying this issue, the Company will retain the flexibility to issue equity securities in the future up to the 15% annual placement capacity set out in ASX Listing Rule 7.1 with out the requirement to obtain prior Shareholder approval.

Technical Information required by ASX Listing Rule 7.4

Pursuant to and in accordance with ASX Listing Rule 7.5, the following information is provided in relation to the Ratification:

• (a) 30,000,000 Shares were allotted and issued;

• (b) the price of Shares on 15 June 2012 was $0.018;

• (c) the Shares issued were all fully paid ordinary shares in the capital of the Company issued on the same terms and conditions as the Company’s existing Shares;

• (d) the Shares were allotted and issued to those parties and on those dates as set out in the table below. None of the subscribers pursuant to this issue are related parties of the Company; and;

Name	Date of Allotment and Issue	Number of Shares
Kalimantan Nominees PtyLtd	15 June 2012	30,000,000
	Total	30,000,000

• (e) the funds raised from this issue were used for the acquisition of tenement E51/1529.

Voting Exclusion:

The Company will disregard any votes in respect of Resolution 4 if they are cast by any person who participated in the issue and any associates of those persons. .

However, the Company need not disregard a vote if:

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

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

RESOLUTION 5: APPROVAL OF ISSUE OF OPTIONS – ACQUISITION OF TENEMENT

Background

Resolution 5 seeks Shareholder approval for the Company to issue 30,000,000 Options as part of the acquisition of the tenement E51/1529 announced on 28 May 2012. This is in addition to the 30,000,000 shares issued for the acquisition on 15 June 2012.

Information Required by ASX Listing Rules

In compliance with the information requirements of ASX Listing Rule 7.3 Shareholders are advised of the following particulars in relation to the proposed issue of Options pursuant to Resolution 5:

• (a) Maximum number of securities proposed for issue : 30,000,000 Options

• (b) Date by which the Company will issue and allot securities: No later than three months after the Date of the Meeting.

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• (c) Price at which the securities proposed for issue: The Options will be issued for no monetary consideration. The exercise price of the Options to convert them into ordinary shares is 2.5 cents each.

• (d) Basis upon which allottees will be determined: Kalimantan Nominees Pty Ltd.

• (e) Terms of issue: The Options will be part of the class issued expiring 31 December 2014 which are unlisted options. The general terms and conditions of the Options are set out in Annexure A.

• (f) Intended use of funds raised: No funds are to be raised from the proposed issue of Options. Any funds raised from the exercise of the Options will be used by the Company to meet its objectives at that time.

• (g) Date of issue: Within three months of the Date of the Meeting.

• (h) Dilutionary Effect: The dilutionary effect of the issue of these Options is set out in detail later in this Explanatory Memorandum.

• (i) Voting Exclusion:

• The Company will disregard any votes in respect of Resolution 5 if they are cast by or on behalf of a person who may participate in the proposed issue and a person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities, if Resolution 5 is passed, and any associate of those persons.

However, the Company need not disregard a vote if:

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

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

Dilutionary Effect of Resolution 5

The intention of Resolution 5 is to issue additional options in conjunction with an entitlement issue to raise capital. The dilution effect is set out as follows:

		Full Capital Raising
Existing Capital
Shares on Issue		349,026,205
Partly Paid Shares		80,000,000
Options on Issue		200,000,000
Total Issued Capital (*)		629,026,205
Options issued for acquisition of tenement
E51/1529announced on 28 May 2012		30,000,000
Total Options	to be Granted	30,000,000
Potential Issued Capital Fully Diluted		659,026,205
Dilution Effect		4.77%

(*) The Total Issued Capital is the total potential existing issued capital if the existing Partly Paid Shares are paid up in full, and existing Options on Issue are exercised.

Trading History – past six months:

The market price of the Company’s Shares during the period the Options are issued and unexercised may be one factor in determining whether or not the Allottees will exercise the Options. The Company’s Shares may be trading on the ASX at a price which is higher than the exercise price of the Options.

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Yellow Rock Resources Limited

The highest, lowest and last recorded market price of the Company’s shares quoted on the ASX during the period from 1 June 2012 to 31 October 2012, being the last six months from the day immediately before the date this Notice was lodged at ASX, were:

Lowest $0.010 – 10 October 2012 Highest $0.022 – 19 July 2012 Last $0.011 – 31 October 2012

RESOLUTION 6 – APPROVAL OF 10% PLACEMENT CAPACITY

General

ASX Listing Rule 7.1A provides that an Eligible Entity may see Shareholder approval at its annual general meeting to allow it to issue Equity Securities up to 10% of its issued capital over a period of up to 12 months after the annual general meeting (10% Placement Capacity).

The Company is an Eligible Entity.

If Shareholders approve Resolution 6, the number of Equity Securities the Eligible Entity may issue under the 10% Placement Capacity will be determined in accordance with the formula prescribed in ASX Listing Rule 7.1A.2 (as set out below).

The effect of Resolution 6 will be to allow the Directors to issue Equity Securities up to 10% of the Company’s fully paid ordinary securities on issue under the 10% Placement Capacity during the period up to 12 months after the Meeting, without subsequent Shareholder approval and without using the Company’s 15% annual placement capacity granted under Listing Rule 7.1.

Resolution 6 is a special resolution. Accordingly, at least 75% of votes cast by Shareholders present and eligible to vote at the Meeting must be in favour of Resolution 6 for it to be passed.

ASX Listing Rule 7.1A

ASX Listing Rule 7.1A came into effect on 1 August 2012 and enables an Eligible Entity to seek shareholder approval at its annual general meeting to issue Equity Securities in addition to those under the Eligible Entity’s 15% annual placement capacity.

An Eligible Entity is one that, as at the date of the relevant annual general meeting:

• (a) is not included in the S&P/ASX 300 Index; and

• (b) has a maximum market capitalisation (excluding restricted securities and securities quoted on a deferred settlement basis) of $300,000,000.

The Company is an Eligible Entity as it is not included in the S&P/ASX 300 Index and has a current market capitalisation (at the date of this Explanatory Statement) of $3,839,288.

Any Equity Securities issued must be in the same class as an existing class of quoted Equity Securities. The Company currently has one class of Equity Securities on issue, being the Shares (ASX Code: YRR).

The exact number of Equity Securities that the Company may issue under an approval under Listing Rule 7.1A will be calculated according to the following formula:

(A x D) - E

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Yellow Rock Resources Limited

Where:

• A is the number of Shares on issue 12 months before the date of issue or agreement:

• (i) plus the number of Shares issued in the previous 12 months under an exception in ASX Listing Rule 7.2;

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

• (iii) plus the number of Shares issued in the previous 12 months with approval of holders of Shares under rule 7.1 or 7.4.

• (iv) less the number of Shares cancelled in the previous 12 months.

• D is 10%

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

Technical Information required by ASX Listing Rule 7.1A

Pursuant to and in accordance with ASX Listing Rule 7.3A, the information below is provided in and relation to this Resolution 6.

(a) Minimum Price

The minimum price at which the Equity Securities may be issued is 75% of the volume weighted average price of Equity Securities in that class, calculated over the 15 ASX trading days on which trades in that class were recorded immediately before:

• (i) the date on which the price at which the Equity Securities are to be issued is agreed; or

• (ii) if the Equity Securities are not issued within 5 ASX trading days of the date in Section 7.3(a)(i), the date on which the Equity Securities are issued.

(b) Date of Issue

The Equity Securities may be issued under the 10% Placement Capacity commencing on the date of the Meeting and expiring on the first to occur of the following:

• (i) 12 months after the date of this Meeting; and

• (ii) the date of approval by Shareholders of any transaction under ASX Listing Rules 11.1.2 (a significant change to the nature of scale of the Company’s activities) or 11.2 (disposal of the Company’s main undertaking). (At which point resolution 6 will cease to have effect).

(c) Risk of Voting Dilution

Any issue of Equity Securities under the 10% Placement Capacity will dilute the interests of Shareholders who do not receive any Shares under the issue.

If Resolution 6 is approved by Shareholders and the Company issues the maximum number of Equity Securities available under the 10% Placement Capacity, the economic and voting dilution of existing Shares would be shown in the table below.

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Yellow Rock Resources Limited

The table below shows the dilution of existing Shareholders calculated in accordance with the formula outlined in ASX Listing Rule 7.1A(2), on the basis of the current market price of Shares and the number of Equity Securities currently on issue.

The table also shows the voting dilution impact where the number of Shares on issue (variable A in the formula) changes and the economic dilution where there are changes in the issue price of Shares issued under the 10% Placement Capacity.

Variable "A" in Listing Rule 7.1A.2	Variable "A" in Listing Rule 7.1A.2	Dilution 50% Decrease in Issue Price Issue Price as at 31 October 2012 100% Increase in Issue Price $0.0055 $0.0110 $0.0220
Current Variable A 349,026,205 Shares	10% Voting Dilution	34,902,621 34,902,621 34,902,621 Shares Shares Shares
	Funds Raised	$191,964 $383,929 $767,858
50% Increase in Current Variable A 523,539,308 Shares	10% Voting Dilution	52,353,931 52,353,931 52,353,931 Shares Shares Shares
	Funds Raised	$287,947 $575,893 $1,151,786
100% Increase in Current Variable A 698,052,410 Shares	10% Voting Dilution	69,805,241 69,805,241 69,805,241 Shares Shares Shares
	Funds Raised	$383,929 $767,858 $1,535,715

The number of Shares on issue (variable A in the formula) could increase as a result of the issue of Shares that do not require Shareholder approval (such as under a pro-rata rights issue or scrip issued under a takeover offer) or that are issued with Shareholder approval under Listing Rule 7.1.

The table above uses the following assumptions:

1. The current Shares on issue are the Shares on issue as at the date of this Notice of Meeting. 2. The current issue price is $0.011, being the closing price of the Company’s Shares on ASX on the date of this Notice of Meeting.

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

3. No Options (including any Options issued under the 10% Placement Facility) are exercised into Shares before the date of the issue of the Equity Securities.

4. 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%.

5. The table does not show an example of dilution that may be caused to a particular Shareholder by reason of placements under the 10% Placement Facility, based on that Shareholder’s holding at the date of the Meeting.

6. 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.

7. The current shares on issue are the Shares on issue as at 31 October 2012.

8. The issue prices is $0.011 being the closing price of the Shares on the ASX on 31 October 2012.

Shareholders should note that there is a risk that:

• (i) the market price for the Company’s Shares may be significantly lower on the issue date than on the date of the Meeting; and

• (ii) the Shares may be issued at a price that is at a discount to the market price for those Shares on the date of issue.

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(d) Purpose of Issue Under 10% Placement Capacity

The Company may issue Equity Securities under the 10% Placement Capacity for the following purposes:

• (i) as cash consideration in which case the Company intends to use funds raised for exploration and evaluation of the Company’s existing projects and general working capital; or including but not limited to the following projects at Gabanintha – Western Australia, Nowthanna – Western Australia and Mt Cockburn – Northern Territory.

• (ii) as non-cash consideration for the acquisition of new assets and investments, in such circumstances the Company will provide a valuation of the non-cash consideration as required by Listing Rule 7.1A.3.

(e) Allocation Under the 10% Placement Capacity

The Company’s allocation policy is dependent on the prevailing market conditions at the time of any proposed issue pursuant to the 10% Placement Capacity. The identity of the allottees of Equity Securities will be determined on a case-by-case basis having regard to a number of factors, including:

• (i) the purpose of the issue;

• (ii) alternative methods for raising funds available to the Company at that time, including, but not limited to, an entitlement issue or other offer where existing Shareholders my participate;

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

• (iv) the circumstances of the Company, including, but not limited to, the financial position and solvency of the Company; and

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

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

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

(f) Previous Approval Under ASX Listing Rule 7.1A

The Company has not previously obtained approval under ASX Listing Rule 7.1A.

Voting Exclusion

• A voting exclusion statement is included in this Notice. As at the date of this Notice, the Company has not invited any existing Shareholder to participate in an issue of Equity Securities under ASX Listing Rule 7.1A. Therefore, no existing Shareholders will be excluded from voting on Resolution 6.

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Yellow Rock Resources Limited

Annexure A

Terms and Conditions of Options

• a) Each option entitles the holder to subscribe for and be allotted one ordinary fully paid share in Yellow Rock Resources Limited.

• b) The options are exercisable at 2.5c each.

• c) The options will expire at 5.00pm WST on 31 December 2014 (the “Expiry Date”).

• d) The options are exercisable at any time on or prior to the Expiry Date by notice in writing to the directors of Yellow Rock Resources Limited accompanied by payment of the exercise price.

• e) The options are freely transferrable.

• f) All shares issued upon exercise of the options will rank pari passu in all respects with Yellow Rock Resources Limited then existing ordinary fully paid shares. Yellow Rock Resources Limited will apply for Official Quotation by the ASX of all shares issued upon exercise of the options, subject to meeting the listing rules for quotation of the class of options.

• g) 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 to shareholders during the currency of the options. However, if from time to time on or prior to the Expiry Date Yellow Rock Resources Limited makes a new issue of new shares to the holders of ordinary fully paid shares, Yellow Rock Resources Limited will send a notice to each holder of options at least thirty (30) Business Days before the record date referable to that issue. This will give Option holders the opportunity to exercise their options prior to the date for determining entitlements to participate in any such issue.

• h) If from time to time on or prior to the Expiry Date Yellow Rock Resources Limited makes an issue of shares to the holders of ordinary fully paid shares in Yellow Rock Resources Limited by way of capitalisation of profits or reserves (a bonus issue), then upon exercise of their options, Option holders will be entitled to have issued to them (in addition to the shares which would otherwise be issued to the member upon such exercise) the number of shares of the class which would have been registered as holder if, immediately prior to that date, they had duly exercised their options and the shares the subject of such exercise had been duly allotted and issued to them. The bonus shares will be paid up by Yellow Rock Resources Limited out of profits or reserves (as the case may be) in the same manner as was applied in relation to the bonus issue and upon issue will rank pari passu in all respects with the other shares allotted upon exercise of the options.

• i) There is no right to a change in the exercise price of the options or to the number of shares over which the options are exercisable in the event of a new issue of capital (other than a bonus issue) during the currency of the options.

• j) In the event of any reorganisation of the issued capital of Yellow Rock Resources Limited 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 Rule in force at the time of the reorganisation.

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Yellow Rock Resources Limited

DEFINITIONS

ASX means ASX Limited ABN 99 009 076 233. ASX Listing Rules means the official listing rules of ASX. Corporations Act means the Corporations Act 2001 (Cth). Director means a director of the Company. Eligible Entity means an entity that, at the date of the relevant general meeting: (a) is not included in the S&P/ASX 300 Index; and (b) has a maximum market capitalisation (excluding restricted securities and securities quoted on a deferred settlement basis) of $300,000,000. 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 Statement means this Explanatory Statement. Meeting means the annual general meeting convened by the Notice Notice means the notice of annual general meeting which forms part of this Explanatory Statement. Ordinary Securities has the meaning set out in the ASX Listing Rules. Placement as the meaning in Resolution 6. Placement Share means a Share issued pursuant to Placement. 10% Placement Capacity has the meaning given in General Section of this Notice. Share means a fully paid ordinary share in the capital of the Company. Shareholder means a holder of a Share.

Yellow Rock or the Company means Yellow Rock Resources Limited (ABN 90 116 221 740).

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Yellow Rock Resources Limited

Proxy Form

The Secretary Yellow Rock Resources Limited 420 Newcastle Street West Perth WA 6005

I/We (full name)

---

of_________________

being a member(s) of Yellow Rock Resources Limited, hereby appoint as my/our proxy

---

of_________________

or, failing him/her the Chairperson of the Meeting to attend and vote for me/us at the general meeting of the Company to be held at AustAsia House, 412 Newcastle Street, West Perth at 10:00am on Friday, 30 November, 2012 and at an adjournment thereof in respect of ____% of my/our shares or, failing any number being specified, ALL of my/our shares in the Company.

The Chairman of the Meeting intends to vote all undirected proxies in favour of all resolutions.

RESOLUTIONS

		FOR	AGAINST	ABSTAIN
1	Adoption of Remuneration Report			
2	Re-election of Director – Brenton Lewis			
3	Removal of Auditor & Appointment of Replacement Auditor			
4	Ratification of Prior Issue – 30 million Shares			
5	Issue of 30 million Options			
6	Approval of 10% Placement Capacity			

If the member is an individual or joint holder:

______ _____ Usual Signature Usual Signature Dated this day of 2012

If the member is a Company:

Signed in accordance with the Constitution of the company the presence of:

Director/Sole Director Director/Secretary Sole Director and Sole Secretary Dated this day of 2012

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Yellow Rock Resources Limited

NOTES

1. A member entitled to attend and vote is entitled to appoint not more than two proxies.

2. Where more than one proxy is appointed and that appointment does not specify the proportion or number of the member’s votes, each proxy may exercise half of the votes.

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

4. If the member is a company it must execute under its Common Seal or otherwise in accordance with its Constitution.

LODGING YOUR PROXY FORM

To be valid, your proxy form (and any power of attorney under which it is signed) must be received at the address given below no later than 10:00am (WST) on Wednesday, 28 November 2012. Any proxy form received after that time will not be valid for the scheduled meeting.

In person: Yellow Rock Resources Limited 420 Newcastle Street West Perth WA 6005

By mail: Yellow Rock Resources Limited PO Box 332 Leederville WA 6903

By fax: (08) 9227 6400

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Yellow Rock Resources Limited