BOSS ENERGY LTD — AGM Information 2013

Oct 30, 2013

BOSS RESOURCES LIMITED

A B N 3 8 1 1 6 8 3 4 3 3 6

NOTICE OF ANNUAL GENERAL MEETING

The Annual General Meeting of the Company will be held at 9.00am (WST) on Friday 29 November 2013 at Suite 23, 513 Hay Street, Subiaco Western Australia.

This Notice should be read in its 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.

Should you wish to discuss any matter please do not hesitate to contact the Company Secretary by telephone on +61 (08) 6143 6730

BOSS RESOURCES LIMITED ABN 38 116 834 336

NOTICE OF GENERAL MEETING

Notice is hereby given that the general meeting of shareholders of Boss Resources Limited ( Company ) will be held at 9.00 am (WST) on Suite 23, 513 Hay Street, Subiaco Western Australia ( Meeting ).

The Explanatory Memorandum to this Notice provides additional information on matters to be considered at the Meeting. The Explanatory Memorandum and the Proxy Form form part of this Notice.

The Directors have determined pursuant to regulation 7.11.37 of the Corporations Regulations 2001 (Cth) that the persons eligible to vote at the Meeting are those who are registered as Shareholders at 5.00 pm on Wednesday 27 November 2013.

Terms and abbreviations used in this Notice and the Explanatory Memorandum are defined in Schedule 1.

AGENDA

1. Annual Report

To receive and consider the financial statements of the Company and its controlled entities for the year ended 30 June 2013, together with the Directors' Report and Auditor's Report, as set out in the Annual Report.

2. Resolution 1 – Remuneration Report

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

"That the Remuneration Report as set out in the Annual Report for the year ended 30 June 2013 be adopted."

Voting Exclusion

In accordance with section 250R of the Corporations Act, a vote on this Resolution must not be cast (in any capacity) by, or on behalf of:

• (a) a member of the Key Management Personnel whose remuneration details are included in the Remuneration Report; or

• (b) a Closely Related Party of such member.

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

• (c) the person does so as a proxy appointed by writing that specifies how the proxy is to vote on Resolution 1; and

• (d) the vote is not cast on behalf of a person described in subparagraphs (a) or (b) above.

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3. Resolution 2 – Re-election of Mr Peter Williams as a Director

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

"That Mr Peter Williams who retires in accordance with 11.12 of the Constitution and being eligible for re-election, be re-elected as a Director."

4. Resolution 3 – Re-election of Mr Evan Cranston as a Director

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

"That Mr Evan Cranston who retires in accordance with clause 11.3 of the Constitution and being eligible for re-election, be re-elected as a Director."

5. Resolution 4 – Additional 10% Placement Capacity

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

"That, pursuant to and in accordance with 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 and on the terms and conditions in the Explanatory Memorandum."

Voting Exclusion

The Company will disregard any votes cast on this Resolution by a person (and any associates of such a person) who may participate in the 10% Placement Facility and a person who might obtain a benefit, except a benefit solely in the capacity of a holder of Shares, if this Resolution is passed.

However, the Company will not disregard a vote if:

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

• (b) it is cast by the Chairman 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.

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6. Resolution 5 – Adoption of a New Constitution

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

"That, with effect from the passing of this resolution and in accordance with section 136 of the Corporations Act, the regulations contained in the printed document produced to this Annual General Meeting and signed by the Chairman for identification purposes are hereby approved and adopted as the constitution of the Company in substitution for and to the exclusion of the existing constitution of the Company."

Dated: 31 October 2013

By Order of the Board

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Oonagh Malone Company Secretary

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BOSS RESOURCES LIMITED ABN 38 116 834 336

EXPLANATORY MEMORANDUM

1. Introduction

This Explanatory Memorandum has been prepared for the information of Shareholders in connection with the business to be conducted at the Meeting to be held at 9.00 am (WST) on Friday 29 November 2013 at Suite 23, 513 Hay Street, Subiaco Western Australia.

This Explanatory Memorandum should be read in conjunction with and forms part of the accompanying Notice. The purpose of this Explanatory Memorandum is to provide information to Shareholders in deciding whether or not to pass the Resolutions set out in the Notice.

A Proxy Form is located at the end of the Explanatory Memorandum.

2. Action to be taken by Shareholders

Shareholders should read this Explanatory Memorandum carefully before deciding how to vote on the Resolutions.

A Proxy Form is attached to the Notice. This is to be used by Shareholders if they wish to appoint a representative (a "proxy") to vote in their place. All Shareholders are invited and encouraged to attend the Meeting or, if they are unable to attend in person, sign and return the Proxy Form to the Company in accordance with the instructions provided. Lodgement of a Proxy Form will not preclude a Shareholder from attending and voting at the Meeting in person.

3. Annual Report

Shareholders will be offered the opportunity to discuss the Annual Report, including the Financial Report, Directors' Report and Auditor's Report for the financial year ended 30 June 2013.

There is no requirement for Shareholders to approve the Annual Report.

Shareholders will be offered the following opportunities:

• (a) discuss the Annual Report for the financial year ended 30 June 2013 which can be accessed online at www.bossresources.com.au and clicking on the direct link to the Annual Report;

• (b) ask questions or make comment on the management of the Company; and

• (c) ask the auditor questions about the conduct of the audit and the preparation and content of the Auditor’s Report.

In addition to taking questions at the meeting, written questions to the Chairman about the management of the Company, or to the Company’s auditor about:

• (a) the preparation and content of the Auditor’s Report;

• (b) the conduct of the audit;

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

• (d) the independence of the auditor in relation to the conduct of the audit,

may be submitted no later than 5 business days before the Meeting to the Company Secretary at the Company's registered office.

4. Resolution 1 – Remuneration Report

In accordance with subsection 250R(2) of the Corporations Act, the Company must put the Remuneration Report to the vote of Shareholders. The Directors' Report contains the Remuneration Report which sets out the remuneration policy for the Company and the remuneration arrangements in place for the executive Directors, specified executives and non-executive Directors.

In accordance with subsection 250R(3) of the Corporations Act, Resolution 1 is advisory only and does not bind the Directors. If Resolution 1 is not passed, the Directors will not be required to alter any of the arrangements in the Remuneration Report.

The Corporations Amendment (Improving Accountability on Director and Executive Remuneration) Act 2011 which came into effect on 1 July 2011, amended the Corporations Act to provide that Shareholders will have the opportunity to remove the whole Board except the managing director if the Remuneration Report receives a 'no' vote of 25% or more ( Strike ) at two consecutive annual general meetings.

Where a resolution on the Remuneration Report receives a Strike at two consecutive annual general meetings, the Company will be required to put to Shareholders at the second annual general meeting a resolution on whether another meeting should be held (within 90 days) at which all Directors (other than the managing director) who were in office at the date of approval of the applicable Directors' Report must stand for reelection.

The Company's Remuneration Report did not receive a Strike at the 2012 annual general meeting. If the Remuneration Report receives a Strike at this Meeting, Shareholders should be aware that if a second Strike is received at the 2014 annual general meeting, this may result in the re-election of the Board.

The Chairman will allow a reasonable opportunity for Shareholders as a whole to ask about, or make comments on the Remuneration Report.

Resolution 1 is an ordinary Resolution.

The Chairman intends to exercise all available proxies in favour of Resolution 1.

If the Chairman is appointed as your proxy and you have not specified the way the Chairman is to vote on Resolution 1, by signing and returning the Proxy Form, you are considered to have provided the Chairman with an express authorisation for the Chairman to vote the proxy in accordance with the Chairman's intention, even though Resolution 1 is connected directly or indirectly with the remuneration of a member of the Key Management Personnel.

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5. Resolution 2 – Re-election of Mr Peter Williams as a Director

Clause 11.11 of the Constitution gives the Directors authority to appoint other Directors.

Mr Peter Williams was appointed as a Director on 20 August 2013.

Clause 11.12 of the Constitution states that any Director appointed in accordance with clause 11.11 must retire at the next annual general meeting and is eligible for reelection.

Accordingly, Mr Peter Williams resigns as a Director at this annual general meeting and being eligible seeks approval to be re-elected as a Director.

Details of Mr William's background and experience are set out in the Annual Report.

Resolution 2 is an ordinary resolution.

The Chairman intends to exercise all available proxies in favour of Resolution 2.

6. Resolution 3 – Re-election of Mr Evan Cranston as a Director

Listing Rule 14.4 requires that a director of an entity must not hold office, without reelection, past the third annual general meeting following the director’s appointment or 3 years, whichever is longer. Clause 11.3 of the Constitution requires that at an annual general meeting one-third of Directors for the time being shall retire from office. A retiring Director is eligible for re-election.

In accordance with the Constitution, Mr Evan Cranston retires by way of rotation as a Director and being eligible, offers himself for re-election.

Details of Mr Cranston's background and experience are set out in the Annual Report.

Resolution 3 is an ordinary resolution.

The Chairman intends to exercise all available proxies in favour of Resolution 3.

7. Resolution 4 – Additional 10% Placement Capacity

7.1 General

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 annual general meeting ( 10% Placement Facility ). The 10% Placement Facility is in addition to the Company's 15% placement capacity under Listing Rule 7.1.

An eligible entity for the purposes of Listing Rule 7.1A is an entity that is not included in the S&P/ASX 300 Index and has a market capitalisation of $300 million or less. The Company is an eligible entity.

The Company is now seeking shareholder approval by way of a special resolution to have the ability to issue equity securities under the 10% Placement Facility.

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The exact number of equity securities to be issued under the 10% Placement Facility will be determined in accordance with the formula prescribed in Listing Rule 7.1A.2 (refer to 6.2(c) below).

The Company is currently undertaking exploration activities at its existing projects and is also seeking to acquire new resources, assets or investments. The Company may use the funds raised from the issue of equity securities under the 10% Placement Facility on its existing projects and/or acquisition of new resource assets or investments.

7.2 Description of Listing Rules 7.1A

• (a) Shareholder approval

The ability to issue equity securities under the 10% Placement Facility is subject to shareholder approval by way of a special resolution at an annual general meeting.

• (b) Equity securities

Any equity securities issued under the 10% Placement Facility must be in the same class as an existing quoted class of equity securities of the Company.

The Company, as at the date of the Notice, has on issue one class of quoted equity securities, being Shares.

• (c) Formula for calculating 10% Placement Facility

Listing Rule 7.1A.2 provides that eligible entities which have obtained shareholder approval at an annual general meeting may issue or agree to issue, during the 12 month period after the date of the annual general meeting, a number of equity securities calculated in accordance with the following formula:

(A x D) – E

A is the number of 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. This does not include an issue of fully paid shares under the entity's 15% placement capacity without shareholder approval;

• (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%

• 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.

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• (d) Listing Rule 7.1 and Listing Rule 7.1A

The ability of an entity to issue equity securities under Listing Rule 7.1A is in addition to the entity's 15% placement capacity under Listing Rule 7.1.

At the date of this Notice, the Company has on issue 455,444,064 Shares and therefore has a capacity to issue:

• (i) 68,316,609 Equity Securities under Listing Rule 7.1; and

• (ii) subject to Shareholder approval being sought under Resolution 3, 45,544,406 Equity Securities under Listing Rule 7.1A.

The actual 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 formula prescribed in Listing Rule 7.1A.2 (refer to 6.2(c) above).

• (e) Minimum Issue Price

The issue price of equity securities issued under Listing Rule 7.1A must be not less than 75% of the VWAP of equity securities in the same class calculated over the 15 trading days 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 trading days of the date in paragraph (i) above, the date on which the equity securities are issued.

• (f) 10% Placement Period

Shareholder approval of the 10% Placement Facility under Listing Rule 7.1A is valid from the date of the annual general meeting at which the approval is obtained and expires on the earlier to occur of:

• (i) the date that is 12 months after the date of the annual general meeting at which the approval is obtained; or

• (ii) the date of the approval by shareholders of a transaction under Listing Rules 11.1.2 (a significant change to the nature or scale of activities) or 11.2 (disposal of main undertaking),

( 10% Placement Period ).

7.3 Listing Rule 7.1A

The effect of Resolution 3 will be to allow the Directors to issue the equity securities under Listing Rule 7.1A during the 10% Placement Period without using the Company’s 15% placement capacity under Listing Rule 7.1.

Resolution 3 is a special resolution and therefore requires approval of 75% of the votes cast by Shareholders present and eligible to vote (in person, by proxy, by attorney or, in the case of a corporate Shareholder, by a corporate representative).

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7.4 Specific information required by Listing Rule 7.3A

Pursuant to and in accordance with Listing Rule 7.3A, information is provided in relation to the approval of the 10% Placement Facility as follows:

• (a) The equity securities will be issued at an issue price of not less than 75% of the VWAP for the Company's equity securities over the 15 trading days 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 trading days of the date in paragraph (i) above, the date on which the equity securities are issued.

• (b) If Resolution 3 is approved by Shareholders and the Company issues equity securities under the 10% Placement Facility, the existing Shareholders' voting power in the Company will be diluted as shown in the below table. 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 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.

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 100% as against the current market price.

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			Dilution
Variable 'A' in Listing Rule 7.1A(2)		$0.0065 50% decrease in Issue Price	$0.013 Issue Price	$0.026 100% increase in Issue Price
455,444,064 Current Variable A	10% Voting Dilution	45,544,406 Shares	45,544,406 Shares	45,544,406 Shares
	Funds raised	$2,960,386	$5,920,772	$11,841,545
683,166,096 50% increase in current Variable A	10% Voting Dilution	68,316,609 Shares	68,316,609 Shares	68,316,609 Shares
	Funds raised	$4,440,579	$8,881,159	$17,762,318
910,888,128 100% increase in current Variable A	10% Voting Dilution	91,088,812 Shares	91,088,812 Shares	91,088,812 Shares
	Funds raised	$5,920,772	$11,841,545	$23,683,091

The table has been prepared on the following assumptions:

• (i) The Company issues the maximum number of equity securities available under the 10% Placement Facility.

• (ii) No Options are exercised into Shares before the date of the issue of the equity securities; (iii) 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%.

• (iv) 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.

• (iv) 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.

• (v) The issue of equity securities under the 10% Placement Facility consists only of Shares. (vi) The issue price is $0.013, being the closing price of the Shares on ASX on 30 October 2013.

• (c) The Company will only issue and allot the equity securities during the 10% Placement Period. The approval under Resolution 3 for the issue of the equity securities will cease to be valid in the event that Shareholders approve a transaction under Listing Rule 11.1.2 (a significant change to the nature or scale of activities) or Listing Rule 11.2 (disposal of main undertaking).

• (d) The Company may seek to issue the equity securities for the following purposes:

• (i) non-cash consideration for the acquisition of new resources, 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; or

• (ii) cash consideration. In such circumstances, the Company intends to use the funds raised towards the exploration activities at its existing projects in Burkina Faso and/or for acquisition of new assets or investments (including expenses associated with such acquisition) and general working capital.

The Company will comply with the disclosure obligations under Listing Rules 7.1A(4) and 3.10.5A upon issue of any equity securities.

The Company’s allocation policy is dependent on the prevailing market conditions at the time of any proposed issue pursuant to the 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 issue in which existing security holders can participate;

• (ii) the effect of the issue of the equity securities on the control of the Company;

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

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

The allottees under the 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.

• (e) The Company has previously obtained Shareholder approval under Listing Rule 7.1A at its annual general meeting held on 30 November 2012. In the 12 months preceding the date of the 2013 Annual General Meeting, the Company has issued 65,070,882 Equity Securities and 19,991,667 Equity Securities have expired. This represents a net increase of 45,079,215 Equity Securities being 9.6% of the total number of Equity Securities on issue at the commencement of that 12 month period. The Company intends to issue a further 41,897,413 shares in advance of the 2013 Annual General Meeting as an allocation of shortfall shares following a rights issue to existing shareholders dated 16 September 2013. In the event that the Company issues the 41,897,413 shares, the Company will have issued 106,968,295 Equity Securities and 19,991,667 Equity Securities will have expired in the 12 months preceding the date of the 2013 Annual General Meeting, representing a net increase of 86,976,628 Equity Securities being 18.5% of the total number of Equity Securities on issue at the commencement of that 12 month period. Details of each issue of Equity Securities by the Company during the 12 months preceding the date of the 2013 Annual General Meeting are set out in the table below:

Date of Issue	Number of Securities	Type of Security	Recipient of Security	Issue Price and details of any discount	Consideration & Use of Funds as at the date of this Notice
29/08/13	7,500,000	Share	Newgenco Pty Ltd	Deemed issue price of $0.008 representing a discount of approximately 47% of the market price on the date of issue	$60,000 consideration being a cost of entering a joint venture over the Liakka and Skogtrask Projects as per ASX announcement on 20 August 2013
22/10/13	57,570,882	Share	Non- renounceable rights issue to existing shareholders of Boss Resources Ltd on a 1 for 4 basis	$0.01 representing a discount of approximately 23% to the market price at the date of issue	$575,708.82 was raised of which nil has been spent. The Company intends to use the funds for exploration costs on Boss’ projects in Finland, Sweden and Burkina Faso and any other projects the Company may acquire in the future, and for general working capital.

Notes:

1. 19,991,667 unlisted options exercisable at $0.12 each expired on 19 October 2013 without being exercised. 2. Prior to the Meeting, the Company intends to issue 41,897,413 shortfall shares following the completion of the nonrenounceable rights issue to shareholders on the basis of 1 share for every 4 held.

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• (f) A voting exclusion statement is included in the Notice. At the date of the Notice, the Company has not approached any particular existing Shareholder or security holder or an identifiable class of existing security holder 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.

8. Resolution 5 – Adoption of New Constitution

It is proposed that the current Company constitution be updated to reflect compliance with current law and enable the Company to better function in accordance with its constituent documents. The proposed constitution has been approved by ASX as required under the ASX Listing Rules.

Resolution 5 seeks Shareholder approval for the adoption of a new constitution in accordance with section 136 of the Corporations Act.

Resolution 5 is a special resolution.

A copy of the Proposed Constitution will be sent to any Shareholder upon request and will also be available for inspection at the Company’s registered office and principal place of business, Suite 23, 513 Hay Street, Subiaco during normal business hours prior to the Annual General Meeting, and available for inspection at the Annual General Meeting.

The new Constitution will become effective from the passing of this Resolution.

In summary, the Proposed Constitution includes provisions to the following effect:

Shares

The issue of shares and options by the Company is under the control of the Directors, subject to the Corporations Act, ASX Listing Rules and any rights attached to any special class of shares.

Preference Shares

The Corporations Act requires certain rights of preference shares to be either set out in the Company's constitution or approved in general meeting by special resolution before preference shares are issued.

The Proposed Constitution sets out a framework of rights for preference share issues from which the Board can determine to allot and issue preference shares, without the need to obtain further shareholder approval every time an allotment of preference shares is proposed. Schedule 6 to the Proposed Constitution contains the framework as well as specific rights of preference shares as to the repayment of capital, requirements for redemption (if the preference shares are redeemable), participation in surplus assets and profits, voting rights and priority of payment of capital and dividends. Other specific terms, including the dividend amount, the redemption date (if applicable) and redemption amount (if applicable), would be set by the issuing resolution of the Directors.

Details of the preference share provisions are contained in Schedule 2 of this Explanatory Memorandum.

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Reductions of Capital

The Proposed Constitution is consistent with the requirement of the Corporations Act which must be satisfied by the Company in undertaking an alteration of capital.

Liens

If the Company issues partly paid shares and a call made on those shares is unpaid, the Company will have a lien over the shares on which the call is unpaid. The lien may be enforced by a sale of those shares.

Transfer of Shares

The Company may participate in any clearing and settlement facility provided under the Corporations Act, the ASX Listing Rules and the ASX Settlement & Transfer Corporation Pty Ltd ( ASTC ) Operating Rules. Transfers through ASTC are affected electronically in ASTC's Clearing House Electronic Sub register System (CHESS). For the purposes of the Company’s participation in the CHESS, the Company may issue holding statements in lieu of share certificates. The Company will not charge any fee for registering a transfer of shares. The Directors may refuse to register a transfer of shares in the circumstances permitted or required under the Corporations Act and ASX Listing Rules.

Proportional Takeovers

A proportional takeover bid is one in which the offeror offers only to buy a specified proportion of each Shareholders' shares.

The Proposed Constitution provides for Shareholder approval of any proportional takeover bid for the shares. Subject to the ASX Listing Rules and ASTC Operating Rules, the provisions require the Directors to refuse to register any transfer of shares made in acceptance of a proportional takeover offer until the requisite Shareholder approval has been obtained.

The perceived advantages of including proportional takeover provisions in the Proposed Constitution are that such provisions may:

• (a) enhance the bargaining power of Directors in connection with any potential sale of the Company;

• (b) improve corporate management by eliminating the possible threat of a hostile takeover through longer term planning;

• (c) make it easier for Directors to discharge their fiduciary and statutory duties to the Company and its Shareholders to advise and guide in the event of a proportional bid occurring; and

• (d) strengthen the position of Shareholders of the Company in the event of a takeover, assuming the takeover will result in a sharing of wealth between the offeror and Shareholders, as the more cohesive Shareholders are in determining their response the stronger they are. A requirement for approval can force Shareholders to act in a more cohesive manner. Where Shareholders know that a bid will only be successful if a specified majority of Shareholders accept the offer, they have less to fear by not tendering to any offer which they think is too low.

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The perceived disadvantages of including proportional takeover provisions in the Proposed Constitution include the following matters:

• (e) a vote on approval of a specific bid suffers from a bias in favour of the incumbent Board;

• (f) the provisions are inconsistent with the principle that a share in a public company should be transferable without the consent of other Shareholders; and

• (g) a Shareholder may lack a sufficient financial interest in any particular company to have an incentive to determine whether the proposal is appropriate.

To comply with the Corporations Act, the proportional takeover provisions must be renewed by Shareholders in general meeting at least every 3 years to remain in place.

Details of the proportional takeover provisions are contained in Schedule 3 of this Explanatory Memorandum.

Alterations of share capital

Shares may be converted or cancelled with Shareholder approval and the Company’s share capital may be reduced in accordance with the requirements of the Corporations Act and the ASX Listing Rules.

Buy Backs

The Company may buy back shares in itself on terms and at such times determined by the Directors.

Disposal of less than a Marketable Parcel

For the sake of avoiding excessive administration costs, the Proposed Constitution contains provisions enabling the Company to procure the disposal of shares where the Shareholder holds less than a marketable parcel of shares within the meaning of the ASX Listing Rules (being a parcel of shares with a market value of less than $500). To invoke this procedure, the Directors must first give notice to the relevant Shareholder holding less than a marketable parcel of shares, who may then elect not to have his or her shares sold by notifying the Directors.

The proposed disposal of unmarketable parcel provisions of the Proposed Constitution are set in Schedule 4 of this Explanatory Memorandum.

Variation of class rights

Class rights attaching to a particular class of shares may be varied or cancelled with the consent in writing of holders of 75% of the shares in that class or by a special resolution of the holders of shares in that class.

Meetings of Shareholders

Directors may call a meeting of Shareholders whenever they think fit. Shareholders may call a meeting as provided by the Corporations Act. The Proposed Constitution contains provisions prescribing the content requirements of notices of meetings of Shareholders and all Shareholders are entitled to a notice of meeting. Consistent with the new Corporations Act provisions, a meeting may be held in two or more places linked together by audio-visual communication devices. A quorum for a meeting of Shareholders is 2 eligible voters.

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The Company will hold annual general meetings in accordance with the Corporations Act and the ASX Listing Rules.

Voting of Shareholders

Resolutions of Shareholders will be decided by a show of hands unless a poll is demanded. On a show of hands each eligible voter present has one vote. On a poll each eligible Shareholder has one vote for each fully paid share held and a fraction of a vote for each partly paid share determined by the amount paid up on that share.

Proxies

An eligible Shareholder may appoint a proxy to attend and vote at the meeting on the Shareholder's behalf. The Proposed Constitution contains provisions specifying the manner of lodgement of proxy instruments. A Shareholder may appoint an individual or corporation to act as its representative.

Directors

Unless changed by the Company in general meeting, the minimum number of directors is 3 and the maximum is 10. The existing directors and the Company may appoint a new Director to fill a casual vacancy or as an addition to the board. Any such Director must retire at the next following annual general meeting of the Company (at which meeting he or she may be eligible for election as director). No Director other than the Managing Director may hold office for longer than 3 years without submitting himself or herself for re-election.

Powers of Directors

The business of the Company is to be managed by or under the direction of the Directors.

Remuneration of Directors

The Company may pay non-executive Directors a maximum of the total amount as determined by the Shareholders in General Meeting and such sum must not be paid by way of commission on, or percentage of, profits or operating revenue.

The remuneration of executive Directors will be subject to the provisions of any contract between each of them and the Company and may be by way of commission on, or percentage of, profits of the Company, but will not be by way of commission on, or percentage of, operating revenue.

Execution of documents

In accordance with the recent amendments to the Corporations Act, the Proposed Constitution provides for execution of documents by the Company without the use of the Company’s company seal.

Dividends

The Directors may fix the amount, the time for payment and the method of payment of a dividend. Subject to any special rights attaching to shares (such as preference shares), dividends will be paid proportionately. The Company is not required to pay any interest on dividends.

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Indemnities and insurance

To the extent permitted by law, the Company indemnifies every person who is or has been a Director or Secretary of the Company against a liability incurred by that person in his or her capacity as a Director or Secretary provided that the liability does not arise out of conduct involving a lack of good faith (otherwise referred to as an excluded liability). A similar indemnity is provided in respect of legal proceedings. The Company may also pay the premiums on directors' and officers' liability insurance.

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Schedule 1 - Definitions

In this Explanatory Memorandum and Notice:

10% Placement Facility has the meaning given in Section 6.1.

10% Placement Period has the meaning given in Section 6.2(f).

ASX means ASX Limited (ABN 98 008 624 691) and, where the context permits, the Australian Securities Exchange operated by ASX Limited.

Board means the board of Directors.

Chair or Chairman means the person appointed to chair the Meeting convened by this Notice.

Closely Related Party :

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

• (b) has the meaning given in section 9 of the Corporations Act.

Company means Boss Resources Limited ABN 38 116 834 336.

Constitution means constitution of the Company as at the commencement of this Meeting.

Corporations Act means the Corporations Act 2001 (Cth).

Director means a director of the Company.

Explanatory Memorandum means the explanatory memorandum to the Notice.

Key Management Personnel means a person 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.

Listing Rules means the listing rules of ASX.

Meeting has the meaning given in the introductory paragraph of the Notice.

Notice means this notice of meeting.

Options means an option which entitles the holder to subscribe for one Share.

Proposed Constitution means the new constitution to be adopted by the Company pursuant to Resolution 5.

Proxy Form means the proxy form attached to the Notice.

Resolution means a resolution contained in this Notice.

Section means a section in the Explanatory Memorandum.

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

Shareholder means a shareholder of the Company.

VWAP means volume weight average price.

WST means Western Standard Time, being the time in Perth, Western Australia.

In this Notice, words importing the singular include the plural and vice versa.

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Schedule 2 – Preference Shares

1. Definitions

In this Schedule, unless the context otherwise requires:

Conversion Circumstances means, in respect of a Converting Preference Share, whether the Preference Share is liable to be converted or convertible:

• (a) at the option of the Holder, or of the Company, or both;

• (b) upon the happening of a particular event; or

• (c) at a fixed time.

Conversion Date means, in respect of a Converting Preference Share, the date (if any) specified in the Issue Resolution for the conversion of that Preference Share or the date upon which an event specified in the Issue Resolution occurs which results in the conversion of that Preference Share.

Conversion Number means the number, or formula for determining the number, of ordinary Shares into which a Converting Preference Share will convert upon conversion.

Converting Preference Share means a Preference Share which is specified in the Issue Resolution as being liable to be converted or convertible into ordinary Shares in a manner permitted by the Corporations Act, whether at the option of the Holder or otherwise.

Dividend means any distribution of any property (including without limitation, money, Paid Up shares, debentures, debenture stock or other securities of the Company or of any other Corporation) to a Holder in respect of a Preference Share as a dividend, whether interim or final.

Dividend Date means, in respect of a Preference Share, a date specified in the Issue Resolution on which a Dividend in respect of that Preference Share is payable.

Dividend Rate means, in respect of a Preference Share, the terms specified in the Issue Resolution for the calculation of the amount of Dividend to be paid in respect of that Preference Share on any Dividend Date, which calculation may be wholly or partly established by reference to an algebraic formula (which shall be at a commercial rate).

Franked Dividend has the meaning given in section 160APA of the Income Tax Assessment Act 1936 (Cth)

Holder means, in respect of a Preference Share, the registered holder of that Share.

Issue Resolution means the resolution specified in paragraph 10.

Preference Share means a Share issued under Article 2.2 of the Constitution.

Redeemable Preference Share means a Preference Share which is specified in the Issue Resolution as being liable to be redeemed in a manner permitted by the Corporations Act.

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Redemption Amount means, in respect of a Redeemable Preference Share, the amount specified in the Issue Resolution to be paid on redemption of the Redeemable Preference Share.

Redemption Circumstances means, in respect of a Redeemable Preference Share, whether the Preference Share is liable to be redeemed:

• (d) at the option of the Holder, or of the Company, or both;

• (e) upon the happening of a particular event; or

• (f) at a fixed time.

Redemption Date means, in respect of a Redeemable Preference Share, the date specified in the Issue Resolution for the redemption of that Preference Share or the date upon which an event specified in the Issue Resolution occurs which results in the redemption of that Preference Share.

Specified Date means, in respect of a Redeemable Preference Share, the date (if any) specified in the Issue Resolution before which that Redeemable Preference Share may not be redeemed by the Holder.

2. Rights of Holders

Each Preference Share confers upon its Holder:

• (a) the rights referred to in the Constitution;

• (b) the right in winding up to payment in cash of the amount then paid up on it, and any arrears of Dividend in respect of that Preference Share in priority to any other class of Shares;

• (c) the right in priority to any payment of a Dividend to any other class of Shares, to a cumulative preferential dividend payable on each Dividend Date in relation to that Preference Share calculated in accordance with the Dividend Rate in relation to that Preference Share; and

• (d) no right to participate beyond the extent elsewhere specified in this paragraph 2 in surplus assets or profits of the Company, whether in winding up or otherwise.

3. Issue Resolution

• (a) The Directors may allot a Preference Share by a resolution of the Directors specifying:

• (i) the Dividend Date;

• (ii) the Dividend Rate;

• (iii) whether the Preference Share is or is not a Redeemable Preference Share;

• (iv) if the Preference Share is a Redeemable Preference Share, the Redemption Amount, the Redemption Date, the Redemption Circumstances and any Specified Date for that Redeemable Preference Share;

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• (v) whether the Preference Share is or is not a Converting Preference Share;

• (vi) if the Preference Share is a Converting Preference Share, the Conversion Circumstances, the Conversion Number and any Conversion Date; and

• (vii) any other terms and conditions to apply to that Preference Share.

• (b) The Issue Resolution in establishing the Dividend Rate for a Preference Share may specify that the Dividend is to be:

• (i) fixed;

• (ii) variable depending upon any variation of the respective values of any factors in an algebraic formula (which shall be at a commercial rate) specified in the Issue Resolution; or

• (iii) variable depending upon such other factors as the Directors may specify in the Issue Resolution,

and may also specify that the Dividend is to be a Franked Dividend or not a Franked Dividend.

• (c) Where the Issue Resolution specifies that the Dividend to be paid in respect of the Preference Share is to be a Franked Dividend the Issue Resolution may also specify:

• (i) the extent to which such Dividend is to be franked; and

• (ii) the consequences of any Dividend paid not being so franked, which may include a provision for an increase in the amount of the Dividend to such an extent or by reference to such factors as may be specified in the Issue Resolution.

4. Redemption

• (a) Subject to the Corporations Act, the Company must redeem a Redeemable Preference Share on issue:

• (i) in the case where the Redeemable Preference Share is liable to be redeemed at the option of the Company, on the specified date where the Company, not less than 10 Business Days before that date, has given a notice to the Holder of that Redeemable Preference Share stating that the Redeemable Preference Share will be redeemed on the specified date;

• (ii) in the case where the Redeemable Preference Share is liable to be redeemed at the option of the Holder, on the specified date where the Holder of that Redeemable Preference Share, not less than 10 Business Days before that date, has given a notice to the Company stating that the Redeemable Preference Share will be redeemed on the specified date; and

• (iii) in any event, on the Redemption Date,

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• (iv) but no Redeemable Preference Share may be redeemed by the Holder before the Specified Date unless the Redemption Date occurs before that date.

• (b) On redemption of a Redeemable Preference Share, the Company, after the Holder has surrendered to the Company the Certificate (if any) in respect of that Redeemable Preference Share, must pay to the Holder the Redemption Amount by:

• (i) directly crediting the account nominated in writing by the Holder from time to time; or

• (ii) cheque made payable to the Holder or such other person nominated in writing by the Holder sent through the post to:

  • (A) in the case where the Holder is a joint holder of the Redeemable Preference Share, the address in the Register of the person whose name stands first on the Register in respect of the joint holding; or

  • (B) otherwise, to the address of the Holder in the Register.

5. Conversion

• (a) Subject to the Corporations Act, the Company must convert a Converting Preference Share on issue:

• (i) in the case where the Converting Preference Share is liable to be redeemed at the option of the Company, on the specified date where the Company, not less than 10 Business Days before that date, has given a notice to the Holder of that Converting Preference Share stating that the Converting Preference Share will be converted on the specified date;

• (ii) in the case where the Converting Preference Share is liable to be redeemed at the option of the Holder, on the specified date where the Holder of that Converting Preference Share, not less than 10 Business Days before that date, has given a notice to the Company stating that the Converting Preference Share will be converted on the specified date; and

• (iii) in any event, on the Conversion Date.

• (b) On conversion of a Converting Preference Share the Company must allot to the Holder additional ordinary Shares such that following conversion the Holder holds that number of ordinary Shares in accordance with the Conversion Number. Conversion of a Converting Preference Shares does not constitute a cancellation, redemption or termination of a Converting Preference Share or the issue, allotment or creation of a new Share.

• (c) The allotment of additional ordinary Shares on Conversion does not constitute a cancellation, redemption or termination of a Converting Preference Share. Conversion is the taking effect of existing rights of a Converting Preference Share and the ending of the special rights attached to the Converting Preference Share.

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• (d) Following Conversion, each Converting Preference Share will rank equally with and will confer rights identical with and impose obligations identical with all other fully paid ordinary Shares then on issue.

6. Certificate

The Certificate (if any) issued by the Company in relation to any Preference Share, must specify in relation to that Preference Share:

• (a) the date of issue of the Preference Share;

• (b) the Dividend Rate and Dividend Dates;

• (c) whether the Preference Share is a Redeemable Preference Share;

• (d) if the Preference Share is a Redeemable Preference Share, the:

• (i) Redemption Circumstances;

• (ii) Redemption Amount; and

• (iii) Redemption Date to the extent possible or if not, the event which if it occurs will result in redemption of that Redeemable Preference Share; and

• (e) if the Preference Share is a Converting Preference Share, the:

• (i) Conversion Circumstances;

• (i) Conversion Number; and

• (ii) Conversion Date to the extent possible or if not, the event which if it occurs will result in conversion of that Concerting Preference Share; and

any other matter the Directors determine.

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Schedule 3 – Proportional Takeovers

1. Definitions

In this Schedule:

Approving Resolution means a resolution to approve a proportional takeover bid in accordance with this Schedule.

Deadline means the 14th day before the last day of the bid period for a proportional takeover bid.

Voter means a person (other than the bidder under a proportional takeover bid or an associate of that bidder) who, as at the end of the day on which the first offer under that bid was made, held bid class securities for that bid.

2. Refusal of transfers

2.1 Requirement for an Approving Resolution

• (a) The Company must refuse to register a transfer of Shares giving effect to a takeover contract for a proportional takeover bid unless and until an Approving Resolution is passed in accordance with this Schedule.

• (b) This Schedule ceases to apply on the 3rd anniversary of its last adoption, or last renewal, in accordance with the Corporations Act.

2.2 Voting on an Approving Resolution

• (a) Where offers are made under a proportional takeover bid, the Directors must, subject to the Corporations Act , call and arrange to hold a meeting of Voters for the purpose of voting on an Approving Resolution before the Deadline.

• (b) The provisions of the Constitution concerning meetings of Shareholders (with the necessary changes) apply to a meeting held under paragraph 2.2(a).

• (c) Subject to the Constitution, every Voter present at the meeting held under paragraph 2.2(a) is entitled to one vote for each Share in the bid class securities that the Voter holds.

• (d) To be effective, an Approving Resolution must be passed before the Deadline.

• (e) An Approving Resolution that has been voted on is taken to have been passed if the proportion that the number of votes in favour of the resolution bears to the total number of votes on the resolution is greater than 50%, and otherwise is taken to have been rejected.

• (f) If no Approving Resolution has been voted on as at the end of the day before the Deadline, an Approving Resolution is taken, for the purposes of this Schedule, to have been passed in accordance with this Schedule.

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Schedule 4 – Unmarketable Parcels

1. Definitions

In this Schedule:

Sale Share means a Share which is sold or disposed of in accordance with this Schedule.

2. Power to sell unmarketable parcels

2.1 Existing unmarketable parcels

• (a) Subject to the applicable law, the Company may sell the Shares of a Shareholder if:

• (i) the total number of Shares of a particular class held by that Shareholder is less than a marketable parcel;

• (ii) the Company gives that Shareholder notice in writing stating that the Shares are liable to be sold or disposed of by the Company; and

• (iii) that Shareholder does not give notice in writing to the Company, by the date specified in the notice of the Company (being not less than 42 days after the date of the Company giving that notice), stating that all or some of those Shares are not to be sold or disposed of.

• (b) The Company may only exercise the powers under paragraph 17.1(a), in respect of one or more Shareholders, once in any 12 month period.

• (c) The power of the Company under paragraph 17.1(a) lapses following the announcement of a takeover bid. However, the procedure may be started again after the close of the offers made under the takeover bid.

2.2 New unmarketable parcels

• (a) Subject to the applicable law, the Company may sell the Shares of a Shareholder if:

• (i) the Shares of a particular class held by that Shareholder are in a new holding created by a transfer on or after 1 September 1999; and

• (ii) that transfer is of a number of Shares of that class that was less than a marketable parcel at the time the transfer document was initiated, or in the case of a paper based transfer document, was lodged with the Company.

• (b) The Company may give a Shareholder referred to in paragraph 17.2(a) notice in writing stating that the Company intends to sell or dispose of the Shares.

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3. Exercise of power of sale

3.1 Extinguishment of interests and claims

The exercise by the Company of its powers under paragraph 17 extinguishes, subject to this Schedule:

• (a) all interests in the Sale Shares of the former Shareholder; and

• (b) all claims against the Company in respect of the Sale Shares by that Shareholder, including all dividends determined to be paid in respect of those Share and not actually paid.

3.2 Manner of sale

• (a) Subject to the Applicable Law, the Company may sell or dispose of any Shares under paragraph 17 at any time:

• (i) using a financial services licensee on the basis that person obtains the highest possible price for the sale of the Shares; or

• (iii) in any other manner and on any terms as the Directors resolve.

• (b) The Company may:

• (i) exercise any powers permitted under the applicable law to enable the sale or disposal of Shares under this Schedule;

• (ii) receive the purchase money or consideration for Sale Shares;

• (iii) appoint a person to sign a transfer of Sale Shares; and

• (iv) enter in the register the name of the person to whom Sale Shares are sold or disposed.

• (c) The person to whom a Sale Share is sold or disposed need not enquire whether the Company:

• (i) properly exercised its powers under this Schedule in respect of that Share; or

• (ii) properly applied the proceeds of sale or disposal of those Shares,

and the title of that person is not affected by those matters.

• (d) The remedy of any person aggrieved by a sale or disposal of Sale Shares is in damages only and against the Company exclusively.

• (e) A certificate in writing from the Company signed by a Director or Secretary that a Share was sold or disposed of in accordance with this Schedule is sufficient evidence of those matters.

3.3 Application of proceeds

• (a) If the Company exercises the powers under paragraph 17.1, either the Company or the person to whom a Sale Share is sold or disposed of must pay the expenses of the sale or disposal.

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• (b) The Company must apply the proceeds of any sale or disposal of any Sale Shares in the following order:

• (i) in the case of an exercise of the powers under paragraph 17.2, the expenses of the sale or disposal;

• (ii) the amounts due and unpaid in respect of those Shares; and

• (iii) the balance (if any) to the former Shareholder or the former Shareholder's personal representative, on the Company receiving the certificate (if any) for those Shares or other evidence satisfactory to the Company regarding the ownership of those Shares.

3.4 Voting and dividend rights pending sale

• (a) If the Company is entitled to exercise the powers under paragraph 17.2, the Company may by resolution of the Directors remove or change either or both:

• (i) the right to vote; and

• (ii) the right to receive dividends,

of the relevant Shareholder in respect of some or all of the Shares liable to be sold or disposed of.

• (b) After the sale of the relevant Sale Shares, the Company must pay to the person entitled any dividends that have been withheld under paragraph 18.4(a).

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