COMET RIDGE LIMITED — AGM Information 2008

Oct 14, 2008

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COMET RIDGE LIMITED

ABN 47 106 092 577

NOTICE OF ANNUAL GENERAL MEETING AND EXPLANATORY MEMORANDUM TO SHAREHOLDERS

Date of Meeting

Friday, 14 November 2008

Time of Meeting

10 am EST

Place of Meeting

Stamford Plaza Hotel, Melbourne

A Proxy Form is enclosed

Please read this Notice and Explanatory Memorandum carefully.

If you are unable to attend the Annual General Meeting please complete and return the enclosed Proxy Form in accordance with the specified directions.

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COMET RIDGE LIMITED ABN 47 106 092 577

NOTICE OF ANNUAL

" That, Mr Andrew Lydyard, who retires in accordance with clause 13.2 of the Constitution and, being eligible for re-election, be re-elected as a Director. "

3. Resolution 3 – Re-election of Ms Gillian Swaby as a Director

GENERAL MEETING

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

Notice is hereby given that the Annual General Meeting of Shareholders of Comet Ridge Limited ABN 47 106 092 577 ("Company") will be held at the Stamford Plaza Hotel, Melbourne on Friday 14 November 2008 at 10 am EST for the purpose of transacting the following business referred to in this Notice of Annual General Meeting.

AGENDA

ITEMS OF BUSINESS

Financial Reports

To receive and consider the financial statements of the Company for the year ended 30 June 2008 together with the Directors Report and the Auditor's Report as set out in the Annual Report.

1. Resolution 1 – Non Binding Resolution to Adopt Remuneration Report

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

" That the Remuneration Report as set out in the Annual Report for the year ended 30 June 2008 be adopted."

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

2. Resolution 2 – Re-election of Mr Andrew Lydyard as a Director

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

" That, Ms Gillian Swaby, who retires in accordance with clause 13.2 of the Constitution and, being eligible for re-election, be re-elected as a Director. "

4. Resolution 4 – Grant of Incentive Options to Mr David Bradshaw

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

" That, pursuant to and in accordance with section 208 of the Corporations Act and Listing Rule 10.11 and for all other purposes, the Directors be and are hereby authorised to grant and issue up to 4,500,000 Incentive Options for no consideration, each Option having an exercise price of $0.25 and an expiry date of three years from issue, to Mr David Bradshaw or his nominee, on the terms and conditions set out in the Explanatory Memorandum (including Annexure A to the Explanatory Memorandum). "

The Company will in accordance with section 224 of the Corporations Act disregard any votes cast on Resolution 4 by Mr David Bradshaw and any associate of Mr David Bradshaw. However, the Company need not disregard a vote if:

(a) it is cast by a person as a proxy appointed in writing that specifies how the proxy is to vote on the proposed Resolution 4 ; and

(b) it is not cast on behalf of Mr David Bradshaw or an associate of Mr David Bradshaw.

5. Resolution 5 – Proposed Issue of Shares

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

"That, for the purpose of Listing Rule 7.1 and all other purposes, the Company approves the allotment and issue of up to 15,000,000 Shares at an issue price of not less than 80% of the average market price of the Company's Shares on the ASX over the last 5 days on which sales of the Shares are

recorded before the date of issue (or if there is a prospectus relating to the issue, over the last 5 days n which sales in the Shares are recorded before the date of the prospectus) as more particularly described in the Explanatory Memorandum".

The Company will disregard any votes cast on Resolution 5 by any person who may participate in the proposed issue and any 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 person associated with those persons. However, the Company need not disregard a vote if the vote is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form or the vote 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.

OTHER BUSINESS

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To deal with any other business which may be brought forward in accordance with the Constitution and the Corporations Act.

“ Listing Rules ” means the Listing Rules of the ASX;

" Notice " means this Notice of Annual General Meeting;

" Resolution " means a resolution contained in this Notice; and

"Shares" means fully paid ordinary shares in the capital of the Company.

By order of the Board

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Jeff Schneider Chairman

Dated: 26 September 2008

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For the purposes of Resolutions 1 - 5, the following definitions apply:

" Annual Report " means the annual report of the Company for the year ended 30 June 2008;

" ASX " means ASX Limited ABN 98 008 624 691 and, where the context permits, the Australian Securities Exchange operated by ASX Limited;

" Company " means Comet Ridge Limited ABN 47 106 092 577;

" Constitution " means the Company's constitution, as amended from time to time;

" Corporations Act " means Corporations Act 2001 (Cth);

" Explanatory Memorandum " means the explanatory memorandum accompanying this Notice;

" Directors " means the Directors of the Company;

" Incentive Option " means an option to acquire a Share the terms of which are set out in Annexure A;

How to vote

Shareholders can vote by either:

• attending the meeting and voting in person or by attorney or, in the case of corporate shareholders, by appointing a corporate representative to attend and vote; or

• appointing a proxy to attend and vote on their behalf using the proxy form accompanying this Notice of Meeting or by submitting their proxy appointment and voting instructions by facsimile.

Voting in person (or by attorney)

Shareholders, or their attorneys, who plan to attend the meeting are asked to arrive at the venue 15 minutes prior to the time designated for the meeting, if possible, so that their holding may be checked against the Company's share register and attendances recorded. Attorneys should bring with them an original or certified copy of the power of attorney under which they have been authorised to attend and vote at the meeting.

Voting by a Corporation

A Shareholder that is a corporation may appoint an individual to act as its representative and vote in person at the meeting. The appointment must comply with the requirements of section 250D of the Corporations Act. The representative should bring to the meeting evidence of his or her appointment, including any authority under which it is signed unless previously given to the Company's Share Registry.

Voting by proxy

• A Shareholder entitled to attend and vote is entitled to appoint not more than two proxies. Each proxy will have the right to vote on a poll and also to speak at the meeting.

• The appointment of the proxy may specify the proportion or the number of votes that the proxy may exercise. Where more than one proxy is appointed and the appointment does not specify the proportion or number of the shareholder's votes each proxy may exercise, the votes will be divided equally among the proxies (i.e. where there are two proxies, each proxy may exercise half of the votes).

• A proxy need not be a shareholder.

• The proxy can be either an individual or a body corporate.

• If a proxy is not directed how to vote on an item of business, the proxy may vote, or abstain from voting, as they think fit.

• Should any resolution, other than those specified in this Notice, be proposed at the meeting, a proxy may vote on that resolution as they think fit.

• If a proxy is instructed to abstain from voting on an item of business, they are directed not to vote on the shareholder's behalf on the poll and the shares that are the subject of the proxy appointment will not be counted in calculating the required majority.

• Shareholders who return their proxy forms with a direction how to vote but do not nominate the identity of their proxy will be taken to have appointed the Chairman of the meeting as their proxy to vote on their behalf. If a proxy form is returned but the nominated proxy does not attend the meeting, the Chairman of the meeting will act in place of the nominated proxy and vote in accordance with any instructions. Proxy appointments in favour of the Chairman of the meeting, the secretary or any Director that do not contain a direction how to vote will be used where possible to support each of the resolutions proposed in this Notice.

• To be effective, proxies must be lodged by 8am (Perth time) on 12 November 2008. Proxies lodged after this time will be invalid.

• Proxies may be lodged using any of the following methods:

• by returning a completed proxy form in person or by post using the pre-addressed envelope provided with this Notice to:

The Company Secretary

C./- Endeavour Corporate Suite 8, 7 The Esplanade Mt Pleasant WA 6153

• by faxing a completed proxy form to

• (08) 9315 5475;

The proxy form must be signed by the shareholder or the shareholder's attorney. Proxies given by corporations must be executed in accordance with the Corporations Act. Where the appointment of a proxy is signed by the appointer's attorney, a certified copy of the power of attorney, or the power itself, must be received by the Company at the above address, or by facsimile, and by 8am (Perth time) on 12 November 2008. If facsimile transmission is used, the power of attorney must be certified.

Shareholders who are entitled to vote

In accordance with Regulations 7.11.37 and 7.11.38 of the Corporations Regulations 2001, the Board has determined that a person's entitlement to vote at the Annual General Meeting will be the entitlement of that person set out in the Register of Shareholders as at 8am on 12 November 2008.

COMET RIDGE LIMITED ABN 47 016 092 577

EXPLANATORY MEMORANDUM

This Explanatory Memorandum is intended to provide shareholders with sufficient information to assess the merits of the Resolutions contained in the accompanying Notice of Annual General Meeting of Comet Ridge Limited (" Comet Ridge " or the " Company ").

FINANCIAL REPORTS

The first item of the Notice of Annual General Meeting deals with the presentation of the consolidated annual financial report of the Company for the financial year ended 30 June 2008 together with the Directors' declaration and report in relation to that financial year and the auditor's report on those financial statements. Shareholders should consider these documents and raise any matters of interest with the Directors when this item is being considered.

No resolution is required to be moved in respect of this item.

Shareholders will be given a reasonable opportunity at the Annual General Meeting to ask questions and make comments on the accounts and on the business, operations and management of the Company.

The Chairman will also provide shareholders a reasonable opportunity to ask the Auditor questions relevant to:

• the conduct of the audit;

RESOLUTION 1 – ADOPTION OF REMUNERATION REPORT

In accordance with section 250R(2) of the Corporations Act the Company is required to present to its shareholders the Remuneration Report as disclosed in the Company's 2008 Annual Report. The vote on the Resolution is advisory only and does not bind the Directors or the Company. The Remuneration Report is set out in the Company’s Annual Report on pages 18 to 21 and is also available on the Company's website (www.cometridge.com.au).

The Remuneration Report explains the Board policies in relation to the nature and level of remuneration paid to Directors, sets out remuneration details for each Director and any service agreements and sets out the details of any share based compensation.

RESOLUTION 2 – RE-ELECTION OF MR ANDREW LYDYARD AS A DIRECTOR

On 22 August 2008, Mr David Bradshaw was appointed to the position of Managing Director, effective from 1 September 2008.

• the preparation and content of the independent audit report;

• the accounting policies adopted by the Company in relation to the preparation of accounts; and

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

The Company's past Managing Director, Mr Andrew Lydyard, has agreed to remain on the board of Comet Ridge as a non-executive Director. Mr Lydyard was recently appointed to the position of President and CEO of Comet Ridge Resources, LLC and is focused on building that business.

As Mr Lydyard is no longer Managing Director, he is now subject to the requirement, in Clause 13.2 of the Company’s Constitution, for one-third of the Directors (other than

alternate Directors and the Managing Director) for the time being, or, if their number is not a multiple of 3, then such number as is appropriate to ensure that no Director other than alternate Directors and the Managing Director holds office for more then 3 years, to retire from office at every annual general meeting of the Company. Clause 13.2 further provides that the Directors to retire at an annual general meeting are those who have been longest in office since their last election, and that a retiring Director is eligible for reelection.

Mr Lydyard was last elected as a Director at the annual general meeting of the Company on 18 November 2004.

Pursuant to Clause 13.2 of the Company's Constitution, Mr Lydyard, being a Director, retires by way of rotation and, being eligible, offers himself for re-election as a Director.

RESOLUTION 3 – RE-ELECTION OF MS GILLIAN SWABY AS A DIRECTOR

Ms Gillian Swaby was appointed as a nonexecutive Director on 9 January 2004 and reelected as a Director at the Company's annual general meeting on 30 November 2005.

Pursuant to Clause 13.2 of the Company's Constitution, Ms Swaby, being a Director, retires by way of rotation and, being eligible, offers herself for re-election as a Director.

RESOLUTION 4 – GRANT OF INCENTIVE OPTIONS TO MR DAVID BRADSHAW

The Company proposes to grant 4,500,000 Incentive Options (each with an exercise price of 25 cents and an expiry date of three years from the date of issue) to Mr David Bradshaw or his nominee. The terms of the Incentive Options are set out in Annexure A to this Explanatory Memorandum.

The Incentive Options will vest in three equal tranches of 1,500,000 Incentive Options each once the Share price exceeds a set trigger price for 1 calendar month as follows:

• Tranche A: Shares trade at or above 35 cents each for one calendar month.

• Tranche B: Shares trade at or above 60 cents each for one calendar month.

• Tranche C: Shares trade at or above 80 cents each for one calendar month.

In the event of a change of control of the Company, any unvested Incentive Options will vest only if the value attributable to a Share by the change of control transaction is at or above the relevant trigger price for vesting.

The grant of Incentive Options encourages Mr Bradshaw, the Company's Managing Director, to have a greater involvement in the achievement of the Company’s objectives and to provide an incentive to strive to that end by participating in the future growth and prosperity of the Company through share ownership. Under the Company’s current circumstances, the Directors (in the absence of Mr David Bradshaw) consider that the incentive intended for Mr Bradshaw represented by the grant of these Incentive Options is a cost effective and efficient means for the Company to provide a reward and an incentive, as opposed to alternative forms of incentive, such as the payment of additional cash compensation.

The number of Incentive Options to be granted to Mr Bradshaw or his nominee has been determined based upon a consideration of:

• the remuneration of the Directors;

• the Directors wish to ensure that the remuneration offered is competitive with market standards. The Directors have considered the proposed number of Incentive Options to be granted will ensure that Mr Bradshaw's overall remuneration is in line with market standards; and

• incentives to attract and ensure continuity of service of directors who have appropriate knowledge and expertise.

The Board do not currently intend to issue further Options to Mr Bradshaw during the term of his current employment contract as Managing Director (which expires on 31 December 2010).

The Company will receive $1,125,000 from Mr Bradshaw (or his nominee) should all the Incentive Options be exercised.

Director	Number of Incentive Options
David Bradshaw	4,500,000

Related Party Transactions Generally

The nature of the financial benefit

Chapter 2E of the Corporations Act prohibits a public company from giving a financial benefit to a related party of the public company unless either:

1. the giving of the financial benefits falls within one of the nominated exceptions to the provision; or

2. shareholder approval is obtained prior to the giving of the financial benefit and the benefit is given within 15 months after obtaining such approval.

For the purposes of Chapter 2E of the Corporations Act, Mr Bradshaw is considered to be a related party of the Company because he is a Director.

Resolution 4 provides for the grant of Incentive Options to Mr Bradshaw or his nominee which is a financial benefit which requires shareholder approval.

Current Holdings

Set out below are details of Mr Bradshaw's relevant interest in Shares as at the date of this Notice:

Director	Number of Shares
David Bradshaw	Nil

Set out below are details of Mr Bradshaw's relevant interest in Options as at the date of this Notice:

Director	Number of Options
David Bradshaw	Nil

INFORMATION REQUIREMENTS

For the purposes of Chapter 2E of the Corporations Act the following information is provided.

The related parties to whom the proposed resolution would permit the financial benefit to be given:

Subject to shareholder approval, the following maximum number of Incentive Options will be granted to Mr Bradshaw, or his nominee:

The proposed financial benefit to be given is the grant of Incentive Options for no consideration to Mr Bradshaw or his nominee as noted above.

Directors’ recommendation

All the Directors were available to make a recommendation. For the reasons noted above:

Messrs Schneider, Lydyard and Drobnack and Ms Swaby (who have no interest in the outcome of Resolution 4) recommend that shareholders vote in favour of Resolution 4. Mr Bradshaw declines to make a recommendation about Resolution 4 as he has a material personal interest in the outcome of that particular Resolution as it relates to the proposed grant of Incentive Options to him or his nominee(s).

Other information that is reasonably required by members to make a decision and that is known to the Company or any of its Directors.

The proposed ordinary Resolution 4 would have the effect of giving power to the Directors to grant of 4,500,000 Incentive Options on the terms and conditions as set out in Annexure A to this Explanatory Memorandum and as otherwise mentioned above.

The Company currently has 105,375,950 listed Shares and the following unlisted Options on issue:

Number	Exercise Price	Expiry Date
1,500,000	$0.20	31/12/2008
450,000	$0.40	11/05/2009
75,000	$0.45	26/06/2009
1,000,000	$0.45	31/07/2009
955,000	$0.45	10/11/2009
3,500,000	$0.45	31/12/2009
1,900,000	$0.45	01/08/2011
30,000	$0.45	04/09/2011
65,000	$0.45	03/12/2011
300,000	$0.45	06/12/2011

If all Incentive Options granted as proposed above are exercised, and assuming all existing Options on issue have been exercised, the effect would be to dilute the share holding of existing shareholders by 2.7%. The market price of the Shares during the period of the Incentive Options will normally determine whether or not Mr Bradshaw or his nominee exercises the Incentive Options. At the time any Incentive Options are exercised and Shares are issued pursuant to the exercise of the Incentive Options, the Shares may be trading at a price which is higher than the exercise price of the Incentive Options.

Mr Bradshaw's salary per annum (including superannuation) and the total financial benefit to be received by him in this current period as a result of the grant of the Incentive Options the subject of Resolution 4 are as follows:

Item	Value(AUD)
Annual Base Salary	384,8471
Annual Short Term Incentive in the form of a bonus payment of up to $175,000 per year dependent on the achievement of certain performance criteria which will be finalised bythe Board.	175,000
Incentive Options – Tranche A	110,400
Incentive Options – Tranche B	106,800
Incentive Options – Tranche C	101,550
Total	878,597

Note:

1. The Annual Base Salary is US$320,000 and has been converted into Australian dollars at a rate of AUD$1.00 = USD$0.8315.

Valuation of Incentive Options

The Company's advisers have valued the Incentive Options to be granted to Mr Bradshaw using the Barrier Up and Binomial Methods, and cross-checking the results with the Black & Scholes Model. The value of an option calculated by the Barrier Up, Binomial Method and Black & Scholes Model is a function of a number of variables. The

valuation of the Incentive Options has been prepared using the following assumptions:

Item	Tranche A	Tranche B	Tranche C
Underlying Shareprice	$0.145	$0.145	$0.145
Exercise price	$0.250	$0.250	$0.250
Barrier price	$0.350	$0.600	$0.800
Dividend rate	Nil	Nil	Nil
Standard deviation of returns - annualised	95%	95%	95%
Risk free rate	5.35%	5.35%	5.35%
Issue date	22/10/08	22/10/08	22/10/08
Expiration date	22/10/11	22/10/11	22/10/11
Expiration period (years)	3.00	3.00	3.00
Valuation per Incentive Option	$0.0736	$0.0712	$0.0677
Valuation per Tranche	$110,400	$106,800	$101,550

The Company’s advisers have calculated the value of each Incentive Option based on the following assumptions:

1. The Incentive Options were valued as of 22 September 2008, assuming an issue date of 22 October 2008.

2. They have based the underlying value of each Share on the ASX closing price of 14.5 cents on 22 September 2008.

3. The risk free rate of return used was 5.35% (the Australian Government 2- year bond rate as at 22 September 2008).

4. They used a volatility of the Share price of 95% (calculated by Hoadley's volatility calculator for the 3 year period, using data extracted from Bloomberg for the past 12 months).

Based on the assumptions, it is considered that the estimated average value of each Tranche of

the Incentive Options to be granted to Mr Bradshaw as follows:

Tranche	Value per Incentive Option(cents)
Tranche A	7.36
Tranche B	7.12
Tranche C	6.77

Any change in the variables applied in the calculations between the date of the valuation and the date the Incentive Options are granted would have an impact on their value.

The following table gives details of the highest, lowest and latest closing price of the Shares trading on ASX over the past 12 months ending on 25 September 2008:

Highest Price (cents) / Date	Lowest Price (cents) / Date	Latest Price (cents) / Date
24 cents on 5/06/2008 and 6/06/2008	8.5 cents on 2/04/2008	13.0 cents on 25/09/2008

Other Information

Under the Australian Equivalent of IFRS, the Company is required to expense the value of the Incentive Options in its statement of financial performance for the current financial year. Other than as disclosed in this Explanatory Memorandum, the Directors do not consider that from an economic and commercial point of view, there are any costs or detriments including opportunity costs or taxation consequences for the Company or benefits foregone by the Company in granting the Incentive Options pursuant to Resolution 4.

Neither the Directors not the Company are aware of other information that would be reasonably required by shareholders to make a decision in relation to the financial benefits contemplated by the proposed resolutions.

Listing Rule 10.11

Listing Rule 10.11 requires shareholder approval by ordinary resolution to any issue by a listed company of securities to a related party. Accordingly, Listing Rule 10.11 requires shareholders to approve the grant of Incentive Options to Mr Bradshaw or his nominee.

Additional Information

The following information in relation to the Incentive Options to be granted pursuant to Resolution 4 is provided to shareholders for the purposes of Listing Rule 10.13:

• (a) the Incentive Options will be granted to Mr Bradshaw, or his nominee, as noted above;

• (b) the maximum number of Incentive Options to be granted is 4,500,000;

• (c) the Incentive Options will be allotted and granted on a date which will be no later than 1 month after the date of this Meeting, unless otherwise extended by way of ASX granting a waiver to the Listing Rules;

• (d) the Incentive Options will be granted for no consideration;

• (e) no funds will be raised by the grant of the Incentive Options; and

• (f) the terms and conditions of the Incentive Options are set out in Annexure A to this Explanatory Memorandum.

If approval is given for the grant of the Incentive Options under Listing Rule 10.11, approval is not required under Listing Rule 7.1.

RESOLUTION 5 – PROPOSED ISSUE OF SHARES

Resolution 5 seeks shareholder approval to the issue of a maximum of 15,000,000 Shares at an issue price of not less than 80% of the weighted average of the closing sale price of the Shares on the ASX on the 5 trading days on which sales are recorded immediately proceeding the date of issue (or, if there is a prospectus relating to the issue, over the last 5 days on which sales in the Shares were recorded before the date of the prospectus).

The funds will be used to progress exploration of the Company's Australian coal seam gas assets, to fund of future cash calls by Comet Ridge Resources, LLC and for business development and working capital.

As noted above, Listing Rule 7.1 requires shareholder approval to the proposed issue of securities in the Company. Listing Rule 7.1

broadly provides, subject to certain exceptions, that shareholder approval is required for any issue of securities by a listed company, where the securities proposed to be issued represent more than 15% of the Company's securities then on issue.

The following information in relation to the Shares to be issued is provided to shareholders for the purposes of Listing Rule 7.3:

• (a) the maximum number of Shares the Company can issue is 15,000,000;

• (b) the Company will allot and issue the Shares no later than 3 months after the date of the Meeting, unless otherwise extended by way of ASX granting a waiver to the Listing Rules;

• (c) The Shares will be allotted progressively;

• (d) the Shares will be issued at a price not less than 80% of the weighted average of the closing sale price of Shares on the ASX on 5 trading days on which sales are recorded immediately preceding the date of issue (or, if there is a prospectus relating to the issue, over the last 5 days on which sales in the Shares were recorded before the date of the prospectus);

• (e) the Shares will be issued and allotted to applicants to be determined by the Directors. No decision has, as yet, been made by the Directors in respect of determining the identity of the allottees, save that the allottees will be unrelated parties of the Company;

" Board " means the board of Directors of the Company.

" Company " means Comet Ridge Limited ABN 47 106 092 577.

" Constitution " means the constitution of the Company.

" Corporations Act " means the Corporations Act 2001 (Cth).

" Director " means a director of the Company.

" Incentive Option " means an option to acquire a Share on the terms set out in Annexure A.

" Listing Rules " means the Listing Rules of the ASX.

" Meeting " means the annual general meeting the subject of the Notice.

" Notice " means the notice of annual general meeting which accompanies this Explanatory Memorandum.

" Option " means an option to acquire a Share.

" Resolution " means a resolution proposed pursuant to the Notice.

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

• (f) the Shares will be fully paid ordinary shares in the capital of the Company and rank equally in all respects with the existing fully paid ordinary shares on issue; and

• (f) the purpose of the issue will be to progress exploration of the Company's Australian coal seam gas assets, to fund future cash calls by Comet Ridge Resources, LLC and for business development and working capital.

GLOSSARY

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

ANNEXURE A

TERMS AND CONDITIONS OF INCENTIVE OPTIONS

• 1.1 No monies will be payable for the issue of the Options.

• 1.2 A certificate will be issued for the Options.

• 1.3 The Options shall expire on the date that is 3 years after the date of issue.

• 1.4 The Options will vest in three equal tranches of 1,500,000 Options each once the Share price exceeds a set trigger price for 1 calendar month as follows:

• Tranche A: Shares trade at or above 35 cents each for one calendar month.

• Tranche B: Shares trade at or above 60 cents each for one calendar month.

• Tranche C: Shares trade at or above 80 cents each for one calendar month.

In the event of a change of control of the Company, any unvested Options will vest only if the value attributable to a Share by the change of control transaction is at or above the relevant trigger price for vesting.

• 1.5 Each Option shall carry the right to subscribe for one Share.

• 1.6 Options may be exercised in whole or in part. As exercise of only some Options shall not affect the rights of the Option Holder to the balance of the Options held by him.

• 1.7 The issue price of Shares the subject of the Options of $0.25 per Share shall be payable in full on exercise of the Options.

• 1.8 Options shall be exercisable by the delivery to the registered office of the Company of a notice in writing stating the intention of the Option Holder to exercise all or a specified number of Options held by him accompanied by an Option certificate and a cheque payable to the Company for the subscription monies for the Shares.

• 1.9 The Company shall allot the resultant Shares and deliver the holding statements within five (5) business days of the exercise of the Option.

• 1.10 Options shall not be listed for Official Quotation on ASX.

• 1.11 An Option Holder may not, except with the approval of the Board of Directors (in its sole and absolute discretion), sell, transfer, assign, give or otherwise dispose of, in equity or in law, the benefit of the Options. The approval of the Board of Directors may be given subject to satisfaction of certain conditions in which event such approval will be deemed not to occur until any such conditions have been satisfied. Nothing in this clause enables the Board of Directors to refuse to register a proper transfer of Options.

• 1.12 Shares allotted pursuant to an exercise of Options shall rank, from the date of allotment, equally with existing Shares of the Company in all respects.

• 1.13 The Company shall, in accordance with Listing Rule 2.8, make application to have Shares allotted pursuant to an exercise of Options listed for Official Quotation.

• 1.14 If the Options are exercised before the record date of an entitlement, the Option Holder can participate in a pro rata issue to the holders of the underlying securities in the Company. The Company must notify the Option Holder of the proposed issue at least nine (9) business days before the record date. Option Holders do not have a right to participate in new issues without exercising their options in accordance with Listing Rule 6.19.

• 1.15 In the event of any reorganisation of capital of the Company, all rights of the Option Holder will be changed to the extent necessary to comply with the Listing Rules applying to a reorganisation of capital at the time of the re-organisation in accordance with the Listing Rules.

• 1.16 The Options will not give any right to participate in dividends until Shares are allotted pursuant to the exercise of the relevant Options.

• 1.17 In the event that a pro rata issue (except a bonus issue) is made to the holders of the underlying securities in the Company, the exercise price of the Options may be reduced according to the following formula:

• O' = O – E[P – (S+D)]

N+1

• O' = the new exercise price of the Option.

• O = the old exercise price of the Option.

• E = the number of underlying securities in the Company into which one Option is exercisable.

• P = the average market price per security (weighted by reference to volume) of the underlying securities in the Company during the five (5) trading days ending on the day before the ex rights date or ex entitlement date.

• S = the subscription price for a security under the pro rata issue.

• D = the dividend due but not yet paid on the existing underlying securities (except those to be issued under the pro rata issue).

• N = the number of securities with rights or entitlements that must be held to receive a right to one new security in the Company.

• 1.18 The number of Shares to be issued pursuant to the exercise of Options will be adjusted for bonus issues made prior to exercise of Options. The effect will be that upon exercise of the Options the number of Shares received by the Option Holder will include the number of bonus Shares that would have been issued if the Option had been exercised prior to the record date for bonus issues. The exercise price of the Options shall not change as result of any such bonus issue.

• 1.19 The Company shall notify each Option Holder and ASX within one (1) month after the record date for a pro-rata bonus or cash issue of the adjustment to the number of Shares over which the Option exists and/or the adjustment to the exercise price.

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All Correspondance to :

PROXY FORM

COMET RIDGE LIMITED ABN 47 106 092 577

Comet Ridge Limited C/- Endeavour Corporate Suite 8, 7 The Esplanade Mt Pleasant WA 6153 T – 61 9316 9100 F – 61 9315 5475

SHAREHOLDER NAME: ADDRESS:

Appointment of Proxy

If appointing a proxy at attend the Annual General Meeting on your behalf, please complete the form and submit it in accordance with the directions on the reverse of the page.

I/We being a shareholder/shareholders of Comet Ridge Limited pursuant to my/our right to appoint not more than two proxies, appoint

Write here the name of the person you are appointing The Chairman of the if this person is someone other than the Chairman of Meeting OR the Meeting. (mark with an "X") Write here the name of the person you are appointing. or failing him/her

or failing him/her, (if no proxy is specified above), the Chairman of the meeting, as my/our proxy to vote for me/us and on my/our behalf at the Annual General Meeting to be held at the Stamford Plaza Hotel, Melbourne and at any adjournment of that meeting.

This proxy is to be used in respect of ______% of the ordinary shares I/we hold.

If the Chair of the meeting is appointed as your proxy, or may be appointed by default and you do not wish to direct your proxy how to vote as your proxy in respect of a resolution, please place a mark in the box. By marking this box, you acknowledge that the Chair of the meeting may exercise your proxy even if he has an interest in the outcome of resolution 4 and votes cast by the Chair of the meeting for those resolutions other than as proxy holder will be disregarded because of that interest. If you do not mark this box, and you have not directed your proxy how to vote, then if the Chair has an interest in the resolution other than as member, the Chair will not cast your votes on the resolution and your votes will not be counted in calculating the required majority if a poll is called on the resolution. The Chair intends to vote 100% of all open proxies in favour of each resolution.

Voting directions to your proxy – please mark ⌧ to indicate your directions

RESOLUTION	For	Against	**Abstain ***
1.Non Binding Resolution to Adopt Remuneration Report	�	�	�
2.Re-election of Mr Andrew Lydyard as a Director	�	�	�
3.Re-election of Ms Gillian Swaby as a Director	�	�	�
4.Grant of Incentive Options to Mr David Bradshaw	�	�	�
5.Proposed Issue of Shares	�	�	�

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

PLEASE SIGN HERE

This section must be signed in accordance with the instructions overleaf to enable your directions to be implemented. Executed in accordance with section 127 of the Corporations Act:

Individual or Shareholder 1 Joint Shareholder 2 Joint Shareholder 3 Sole Director & Sole Company Secretary Director Director/ Company Secretary Dated this ____ day of __________ 2008

_______ _________ Contact Name Contact Business Telephone / Mobile

Annual General Meeting Proxy Form

Comet Ridge Limited ABN 47 106 092 577

INSTRUCTIONS FOR COMPLETING PROXY FORM

1. Completion of a proxy form will not prevent individual shareholders from attending the Annual General Meeting in person if they wish. Where a shareholder complete and lodges a valid proxy form and attend the Annual General Meeting in person, then the proxy's authority to speak and vote for that shareholder is suspended while the shareholder is present at the Annual General Meeting.

2. A shareholder of the Company entitled to attend and vote is entitled to appoint not more than two proxies. Where more than one proxy is appointed, each proxy must be appointed to represent a specified proportion of the shareholder's voting rights. If the shareholder appoints two proxies and the appointment do not specify this proportion, each proxy may exercise half of the votes.

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

4. If you mark the abstain box for a particular item, you are directing your proxy not to vote on that item on a show of hands or on a poll and that your shares are not to be counted in computing required majority on a poll.

5. Should any resolution, other than those specified in this Notice, be proposed at the meeting, a proxy may vote on that resolution as they think fit.

6. If a representative of a company shareholder is to attend the Meeting, a properly executed original (or certified copy) of the appropriate "Certificate of Appointment of Corporate Representative" should be produced for admission to the Meeting.

7. If a representative as Power of Attorney of a shareholder is to attend the meeting, a properly executed original (or originally certified copy) of an appropriate Power of Attorney should be produced for admission to the Annual General Meeting.

8. Signing Instructions

You must sign this form as follows in the spaces provided:

Individual: Where the holding is in one name, the holder must sign. Joint Holding: Where the holding is in more than one name, all of the shareholders should sign. Power of Attorney: If you are signing under a Power of Attorney, you must lodge an original or certified photocopy of the appropriate Power of Attorney with your completed Proxy Form. Companies: Where the company has a Sole Director who is also the Sole Company Secretary this form must be signed by that person.

If the company (pursuant to section 204A of the Corporations Act 2001) does not have a Company Secretary, a Sole Director can also sign alone.

Otherwise this form must be signed by a Director jointly with either another Director or a Company Secretary. Please indicate the office held by signing in the appropriate place.

1. Lodgement of a Proxy

This Proxy Form (and any power of Attorney under which it is signed) must be received at the address below not later than 8am on 12 November 2008 (48 hours before the commencement of the Meeting). Any Proxy Form received after that time will not be valid for the scheduled Meeting.

Hand and postal deliveries: C/- Endeavour Corporate Suite 8, 7 The Esplanade MT PLEASANT WA 6153

Fax number:

+61 8 9315 5475