CUE ENERGY RESOURCES LIMITED — AGM Information 2018

Sep 26, 2018

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CUE ENERGY RESOURCES LIMITED ABN 45 066 383 971

Notice of Annual General Meeting Explanatory Statement and Proxy Form

Date of Meeting: Tuesday, 30 October 2018

Time of Meeting: 9.30am (AEDT)

Place of Meeting:

BDO Tower 4, 727 Collins Street, Melbourne, Victoria 3008

This Notice of Annual General Meeting and Explanatory Statement 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 advisor without delay

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CUE ENERGY RESOURCES LIMITED

ABN 45 066 383 971

Registered office: Level 3, 10-16 Queen Street, Melbourne, Victoria, 3000

NOTICE OF ANNUAL GENERAL MEETING

Notice is hereby given that the Annual General Meeting of shareholders of Cue Energy Resources Limited (the “Company”) will be held at the offices of BDO, Tower 4, 727 Collins Street, Melbourne, Victoria, 3008 at 9.30am (AEDT) on Tuesday, 30 October 2018 (“Annual General Meeting” or “Meeting”).

AGENDA

The Explanatory Statement and proxy form which accompany and form part of this Notice, include defined terms and describe in more detail the matters to be considered. Please consider this Notice, the Explanatory Statement and the proxy form in their entirety.

ORDINARY BUSINESS

Receipt and consideration of Accounts & Reports

To receive and consider the financial report of the Company and the related reports of the Directors (including the Remuneration Report) and auditors for the year ended 30 June 2018.

Note: Except for as set out in Resolution 1, there is no requirement for shareholders to approve these reports. Accordingly, no resolution will be put to shareholders on this item of business.

Resolution 1: Adoption of Remuneration Report

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

“That for the purpose of Section 250R(2) of the Corporations Act and for all other purposes, the Remuneration Report (included in the Directors' Report) for the financial year ended 30 June 2018 be adopted.”

Resolution 2: Election of Mr Alastair McGregor as a Director of the Company

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

“That Mr Alastair McGregor, having been appointed as a Director during the year, vacates office in accordance with the Constitution of the Company and, being eligible, offers himself for election as a Director of the Company.”

Resolution 3: Election of Mr Andrew Jefferies as a Director of the Company

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

“That Mr Andrew Jefferies, having been appointed as a Director during the year, vacates office in accordance with the Constitution of the Company and, being eligible, offers himself for election as a Director of the Company.”

Resolution 4: Election of Mr Peter Hood as a Director of the Company

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

“That Mr Peter Hood, having been appointed as a Director during the year, vacates office in accordance with the Constitution of the Company and, being eligible, offers himself for election as a Director of the Company.”

Resolution 5: Election of Ms Rebecca DeLaet as a Director of the Company

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

“That Ms Rebecca DeLaet, having been appointed as a Director during the year, vacates office in accordance with the Constitution of the Company and, being eligible, offers herself for election as a Director of the Company.”

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Resolution 6: Election of Mr Richard Malcolm as a Director of the Company

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

“That Mr Richard Malcolm, having been appointed as a Director during the year, vacates office in accordance with the Constitution of the Company and, being eligible, offers himself for election as a Director of the Company.”

Resolution 7: Election of Mr Roderick Ritchie as a Director of the Company

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

“That Mr Roderick Ritchie, having been appointed as a Director during the year, vacates office in accordance with the Constitution of the Company and, being eligible, offers himself for election as a Director of the Company.”

Resolution 8: Election of Mr Samuel Kellner as a Director of the Company

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

“That Mr Samuel Kellner, having been appointed as a Director during the year, vacates office in accordance with the Constitution of the Company and, being eligible, offers himself for election as a Director of the Company.”

SPECIAL BUSINESS

Resolution 9: Approval of 10% Placement Facility

To consider and, if thought fit, pass 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 Statement.”

DATED this 26 September 2018 at Melbourne.

By order of the Board

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Melanie Leydin Company Secretary

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Notes

1. Entire Notice: The details of the resolutions contained in the Explanatory Statement accompanying this Notice of Meeting should be read together with, and form part of, this Notice of Meeting.

2. Record Date: The Company has determined that for the purposes of the Annual General Meeting, shares will be taken to be held by the persons who are registered as holding the shares at 7:00pm on the date 48 hours before the date of the Annual General Meeting. Only those persons will be entitled to vote at the Annual General Meeting and transfers registered after that time will be disregarded in determining entitlements to attend and vote at the Annual General Meeting.

3. Proxies

• a. Votes at the Annual General Meeting may be given personally or by proxy, attorney or representative.

• b. Each shareholder has a right to appoint one or two proxies.

• c. A proxy need not be a shareholder of the Company.

• d. If a shareholder is a company it must execute under its common seal or otherwise in accordance with it constitution or the Corporations Act.

• e. Where a shareholder is entitled to cast two or more votes, the shareholder may appoint two proxies and may specify the proportion of number of votes each proxy is appointed to exercise.

• f. If a shareholder appoints two proxies, and the appointment does not specify the proportion or number of the shareholder’s votes, each proxy may exercise half of the votes. If a shareholder appoints two proxies, neither proxy may vote on a show of hands.

• g. A proxy must be signed by the shareholder or his or her attorney who has not received any notice of revocation of the authority. Proxies given by corporations must be signed in accordance with corporation’s constitution and Corporations Act.

• h. To be effective, proxy forms must be received by the Company’s share registry (Computershare Investor Services Pty Limited) no later than 48 hours before the commencement of the Annual General Meeting, this is no later than 9.30am (AEDT) on Saturday, 28 October 2018. Any proxy received after that time will not be valid for the scheduled meeting.

4.

Corporate Representative

Any corporate shareholder who has appointed a person to act as its corporate representative at the Meeting should provide that person with a certificate or letter executed in accordance with the Corporations Act authorising him or her to act as that company’s representative. The authority may be sent to the Company and/or registry in advance of the Meeting or handed in at the Meeting when registering as a corporate representative.

5. Voting Exclusion Statement:

Resolution 1

The Company will disregard any votes cast in favour of this resolution (in any capacity) by or on behalf of a member of the Key Management Personnel (being those persons described as such in the Remuneration Report) or a closely related party of such a member unless the vote cast as proxy for a person entitled to vote:

• (a) in accordance with a direction on the proxy form; or,

• (b) by the Chairman of the meeting as proxy for a person entitled to vote and the Chairman has received express authority to vote undirected proxies as the Chairman sees fit.

Accordingly, if you intend to appoint a member of Key Management Personnel as your proxy, please ensure that you direct them how to vote. If you intend to appoint the Chairman of the meeting as your proxy, you can direct him to vote by marking the box for Resolution 1. By marking the Chairman’s box on the proxy form you acknowledge that the Chairman of the meeting will vote in favour of this item of business as your proxy. The Chairman will vote undirected proxies in favour of Resolution 1.

Resolutions 2, 3, 4, 5, 6, 7, and 8

There are no voting exclusions on these resolutions.

Resolution 9

The Company will disregard any votes cast in favour of this Resolution by any person who may participate in the proposed issue or any person who might obtain a material benefit, except a benefit solely in the capacity of a holder of ordinary shares, and any associate of such person.

6. Enquiries

Shareholders are invited to contact the Company Secretary, Melanie Leydin on (03) 8610 4000 if they have any queries in respect of the matters set out in these documents.

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EXPLANATORY STATEMENT

Receipt and consideration of Accounts & Reports

A copy of the Annual Report for the financial year ending 30 June 2018 (which incorporates the Company's financial report, reports of the Directors (including the Remuneration Report and the Auditors Report) is not enclosed as there is no longer a requirement for the Company to incur the printing and distribution cost associated with doing so for all shareholders. You may obtain a copy free of charge in hard copy form by contacting the Company by phone at (03) 8610 4000, and you may request that this occurs on a standing basis for future years. Alternatively you may access the Annual Report at the Company's website: http://www.cuenrg.com.au or via the Company's announcement platform on ASX. Except as set out in Resolution 1, no resolution is required on these reports.

Resolution 1: Adoption of Remuneration Report

Background

Section 250R(2) of the Corporations Act requires that a resolution to adopt the remuneration report must be put to the vote at the Annual General Meeting. The vote on this Resolution is advisory only and does not bind the Directors or the Company.

The Remuneration Report is set out in the Directors’ Report in the Company’s 2018 Annual Report. The Remuneration Report sets out the Company’s remuneration arrangements for the Directors and senior management of the Company.

In accordance with Section 250SA of the Corporations Act 2001, Shareholders will be provided with a reasonable opportunity to ask questions concerning, or make comments on, the remuneration report at the Annual General Meeting.

The Corporations Act requires the Company to put a resolution to Shareholders that, in accordance with Division 9 of Part 2G.2 of the Corporations Act, if twenty five (25%) per cent or more of votes that are cast are voted against the adoption of the Remuneration Report at two consecutive Annual General Meetings, Shareholders will be required to vote at the second of those Annual General Meetings on a resolution (a “spill resolution”) that another meeting be held within 90 days at which all of the Company’s Directors (other than the Managing Director) must go up for re-election.

It is noted that at the Company’s last Annual General Meeting, the votes cast against the remuneration report represented less than twenty five (25%) per cent of the total votes cast and accordingly, a spill resolution will not under any circumstances be required for the Annual General Meeting.

The Directors will consider the outcome of the vote and comments made by Shareholders on the Remuneration Report at the Meeting when reviewing the Company’s remuneration policies.

Board Recommendation

The Board encourage all eligible shareholders to cast their votes in favour of Resolution 1. The Chairman of the meeting intends to vote undirected proxies in favour of Resolution 1.

Voting Exclusions

The Company will disregard any votes cast in favour of this resolution (in any capacity) by or on behalf of a member of the Key Management Personnel (being those persons described as such in the Remuneration Report) or a closely related party of such a member unless the vote cast as proxy for a person entitled to vote in accordance with a direction on the proxy form.

Any undirected proxies held by Directors or other Key Management Personnel or their closely related parties for the purposes of Resolution 1 (excluding the Chairman) will not be voted on Resolution 1. Accordingly, if you intend to appoint a member of Key Management Personnel as your proxy, please ensure that you direct them how to vote. If you intend to appoint the Chairman of the meeting as your proxy, you can direct him to vote by marking the box for Resolution 1. By marking the Chairman’s box on the proxy form you acknowledge that the Chairman of the meeting will vote in favour of this item of business as your proxy.

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Resolution 2: Election of Mr Alastair McGregor as a Director of the Company

Background

Mr Alastair McGregor was appointed as a Non-Executive Director on 23 February 2018 and Chairman of the Board on 24 April 2018 as a casual vacancy and is eligible for election under the Company’s Constitution.

Alastair McGregor has been actively involved in the oil & gas sector since 2003. He is currently chief executive of O.G. Energy, which holds the Ofer Global Group’s broader energy interests, and O.G. Oil & Gas Limited, a company that holds directly or indirectly oil & gas exploration and production interests onshore and offshore. He leads the O.G. Energy Senior Management Committee, driving the strategy for the Ofer Global Group’s energy activities. Mr. McGregor is also a director of New Zealand Oil & Gas.

In addition, Mr McGregor is a chief executive of Omni Offshore Terminals Limited, a leading integrated provider of floating production and storage and offloading (FPSO & FSO) solutions to the offshore oil & gas industry. Omni’s operations span the globe from New Zealand, Australia, South East Asia, Middle East and South America. Prior to entering the oil & gas industry Alastair spent 12 years as a banker with Citigroup and Salomon Smith Barney. Alastair holds a BEng from Imperial College, London and an MSc from Cranfield University in the UK.

Board Recommendation

The Board (with Mr McGregor abstaining), recommends that shareholders vote in favour of the election of Mr McGregor. The Chairman of the meeting intends to vote undirected proxies in favour of Mr McGregor’s election.

Voting Exclusions

There are no voting exclusions on this resolution.

Resolution 3: Election of Mr Andrew Jefferies as a Director of the Company

Background

Mr Andrew Jefferies was appointed as a Non-Executive Director on 23 February 2018 as a casual vacancy and is eligible for election under the Company’s Constitution. He is Chairman of the Remuneration and Nomination Committee and a member of the Audit and Risk Committee.

Mr Jefferies is Managing Director of New Zealand Oil & Gas Limited. He started his career with Shell in Australia after graduating with a BE Hons (Mechanical) from the University of Sydney in 1991, an MBA in technology management from Deakin University in Australia, and an MSc in petroleum engineering from Heriot - Watt University in Scotland. Andrew is also a graduate of the Australian Institute of Company Directors (GAICD), and a Certified Petroleum Engineer with the Society of Petroleum Engineers. He has worked in oil and gas in Australia, Germany, the United Kingdom, Thailand and Holland.

Board Recommendation

The Board (with Mr Jefferies abstaining), recommends that shareholders vote in favour of the election of Mr Jefferies. The Chairman of the meeting intends to vote undirected proxies in favour of Mr Jefferies’ election.

Voting Exclusions

There are no voting exclusions on this resolution.

Resolution 4: Election of Mr Peter Hood as a Director of the Company

Background

Mr Peter Hood was appointed as a Non-Executive Director on 23 February 2018 as a casual vacancy and is eligible for election under the Company’s Constitution. He is a member of the Audit and Risk Committee.

Mr Hood is a professional chemical engineer with 45 years’ experience in the development of projects in the resources and chemical industries. He began his career with WMC Ltd and then as Chief Executive Officer of Coogee Chemicals Pty Ltd and Coogee Resources Ltd from 1998 to 2009. He is a graduate of the Harvard Business School Advanced Management Programme and is currently Chairman of Matrix Composites and Engineering Ltd and a Non-Executive Director of GR Engineering Ltd. He was previously Vice-Chairman of the Australian Petroleum Production and Exploration Association Limited (APPEA), Chairman of the APPEA Health Safety and Operations Committee, and was President of the Western Australian and Australian Chambers of Commerce and Industry.

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Board Recommendation

The Board (with Mr Hood abstaining), recommends that shareholders vote in favour of the election of Mr Hood. The Chairman of the meeting intends to vote undirected proxies in favour of Mr Hood’s election.

Voting Exclusions

There are no voting exclusions on this resolution.

Resolution 5: Election of Ms Rebecca DeLaet as a Director of the Company

Background

Ms Rebecca DeLaet was appointed as a Non-Executive Director on 11 April 2018 as a casual vacancy and is eligible for election under the Company’s Constitution. She is the Chair of the Audit and Risk Committee.

Ms DeLaet has worked for the Ofer Global Group of companies since 1990. For the last ten years she has overseen the Group's finance activities, including debt and equity financing, treasury operations and risk management. Ms DeLaet was responsible for the initial structuring and capitalisation of Omni Offshore Terminals' assets in 1994, establishing an independent oil and gas arm for the Ofer Global Group. Since then, she has been responsible for all of the financing activities for the Omni organisation. Ms DeLaet is a director of O.G. Energy, O.G. Oil & Gas and New Zealand Oil & Gas, where she is the chair of the Audit Committee. As a member of the O.G. Energy Senior Management Committee, she helps drive the strategy for the Ofer Global Group’s energy activities. She has a Masters in Finance and Bachelor of Science from the Wharton School at the University of Pennsylvania.

Board Recommendation

The Board (with Ms DeLaet abstaining), recommends that shareholders vote in favour of the election of Ms DeLaet. The Chairman of the meeting intends to vote undirected proxies in favour of Ms DeLaet’s election.

Voting Exclusions

There are no voting exclusions on this resolution.

Resolution 6: Election of Mr Richard Malcolm as a Director of the Company

Background

Mr Richard Malcolm was appointed as a Non-Executive Director on 23 February 2018 as a casual vacancy and is eligible for election under the Company’s Constitution. He is a member of the Remuneration and Nomination Committee.

Mr Malcolm is a professional geoscientist with 34 years of varied oil and gas experience within seven international markets. He began his career as a Petroleum Geologist with Woodside Petroleum in Perth exploring for oil and gas on the Northwest Shelf. He spent ten years with Ampolex Limited (Perth and Sydney) as a Senior Explorationist and then Exploration Manager in Western Australia and Asset Manager in Northern & Eastern Australia. Following Mobil’s takeover of Ampolex, Mr Malcolm was appointed manager of Mobil’s assets in Papua New Guinea. Three years later he joined OMV, initially as Exploration Manager for Australia & New Zealand and later as Exploration & Reservoir Manager for OMV Libya, General Manager Norway and in 2006, Managing Director of OMV UK. Between 2008 and 2013, Mr Malcolm was Chief Executive Officer of Gulfsands Petroleum plc, an AIM listed production, exploration and development company with operations in Syria, Tunisia, Morocco, USA and Colombia. He is currently a director of Larus Energy.

Board Recommendation

The Board (with Mr Malcolm abstaining), recommends that shareholders vote in favour of the election of Mr Malcolm. The Chairman of the meeting intends to vote undirected proxies in favour of Mr Malcolm’s election.

Voting Exclusions

There are no voting exclusions on this resolution.

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Resolution 7: Election of Mr Roderick Ritchie as a Director of the Company

Background

Mr Roderick Ritchie was appointed as a Non-Executive Director on 23 February 2018 as a casual vacancy and is eligible for election under the Company’s Constitution. He is a member of Remuneration and Nomination Committee.

Mr Ritchie is a director of New Zealand Oil & Gas Limited. Rod joined the board of New Zealand Oil & Gas in 2013. He graduated with a BSc, University of Tulsa. He has 38 years of experience as a line manager and a Health, Safety, Security and Environment executive in the oil and gas industry – including as Corporate Senior Vice President of HSSE at OMV based in Vienna. He is a member of the Society of Petroleum Engineers.

Board Recommendation

The Board (with Mr Ritchie abstaining), recommends that shareholders vote in favour of the election of Mr Ritchie. The Chairman of the meeting intends to vote undirected proxies in favour of Mr Ritchie’s election.

Voting Exclusions

There are no voting exclusions on this resolution.

Resolution 8: Election of Mr Samuel Kellner as a Director of the Company

Background

Mr Samuel Kellner was appointed as a Non-Executive Director on 23 February 2018 as a casual vacancy and is eligible for election under the Company’s Constitution.

Samuel Kellner has held a variety of senior executive positions with the Ofer Global Group since joining the Group in 1980. He has been deeply involved in various Ofer Global Group’s business lines, with a particular emphasis on offshore oil and gas, shipping and real estate, and has advised the Ofer Global Group companies on investments in a variety of investment managers, hedge funds and private equity funds. Most recently, Mr Kellner served as president of Global Holdings Management Group (US) Inc. where he led North American real estate acquisition, development and financing activities. Mr. Kellner serves as a director of O.G. Energy, O.G. Oil & Gas and is the Chairman of the Board of Directors of New Zealand Oil & Gas. He is also an executive director of the main holding companies for the Zodiac shipping group and Omni Offshore Terminals, a leading provider of floating production, storage and offloading (FSO and FPSO) solutions to the offshore oil and gas industry. As a member of the O.G. Energy Senior Management Committee, he helps drive the strategy for the Ofer Global Group’s energy activities. Mr. Kellner graduated with a BA degree from Hebrew University in Jerusalem. He has an MBA from the University of Toronto, and taught at the University of Toronto while working toward a PhD in Applied Economics.

Board Recommendation

The Board (with Mr Kellner abstaining), recommends that shareholders vote in favour of the election of Mr Kellner. The Chairman of the meeting intends to vote undirected proxies in favour of Mr Kellner’s election.

Voting Exclusions

There are no voting exclusions on this resolution.

Resolution 9: Approval of 10% Placement Facility

Background

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 (see below).

The Company continues actively seeking to enhance the value of its assets and new investments. Should the Company utilise the 10% Placement Facility, it intends to use the funds to either accelerate the work on its current projects, acquire new assets, or to meet additional working capital requirements.

Description of Listing Rule 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. This means it 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).

(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 Fully Paid Ordinary Shares on issue.

(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 Rules 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 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.

(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.

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

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(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 ).

Listing Rule 7.1A

The effect of Resolution 9 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 9 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).

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 9 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. Shareholders may be exposed to economic risk and voting dilution, including the following:

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

• (ii) the Equity Securities may be issued at a price that is at a discount to the market price for the Company's Equity Securities on the issue date.

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 market price of Shares as at 17 September 2018 (Current Share Price) 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:

• 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

• 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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Variable 'A' in Listing Rule 7.1A.2		Issue Price	Issue Price	Issue Price
		$0.032 50% decrease in Current Share **Price **	$0.064 Current Share Price	$0.128 100% increase in Current **Share Price **
Current Variable A 698,119,720 Shares	10% Voting **Dilution **	69,811,972 Shares	69,811,972 Shares	69,811,972 Shares
	Funds **raised **	$2,233,983	$4,467,966	$8,935,932
50% increase in current Variable A 1,047,179,580 Shares	10% Voting **Dilution **	104,717,958 Shares	104,717,958 Shares	104,717,958 Shares
	Funds **raised **	$3,350,975	$6,701,949	$13,403,899
100% increase in current Variable A 1,396,239,440 Shares	10% Voting **Dilution **	139,623,944 Shares	139,623,944 Shares	139,623,944 Shares
	Funds **raised **	$4,467,966	$8,935,932	$17,871,865

The table has been prepared on the following assumptions:

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

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

• 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%.

• 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 Annual General Meeting.

• 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.

• The issue of Equity Securities under the 10% Placement Facility consists only of Shares. If the issue of Equity Securities includes Options, it is assumed that those Options are exercised into Shares for the purpose of calculating the voting dilution effect on existing Shareholders.

• The Current Share Price is $0.064 (6.4 cents), being the closing price of the Shares on ASX on 17 September 2018.

• (c) The Company will only issue and allot the Equity Securities during the 10% Placement Period. The approval under Resolution 9 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 the new assets and investments. In such circumstances the Company will provide a valuation of the non-cash consideration as required by Listing Rule 7.1A.3; or

• (ii) cash consideration. In such circumstances, the Company intends to use the funds raised towards an acquisition of new assets or investments (including expenses associated with such acquisition), continued expenditure on the Company’s current business and/or general working capital.

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• (e) 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;

• (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 businesses, assets or investments, it is likely that the allottees under the 10% Placement Facility will be the vendors of the new businesses, assets or investments.

• (f) A voting exclusion statement is included in the Notice. At the date of this 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 this Notice.

Board Recommendation

The Board believes that Resolution 9 is in the best interests of the Company and unanimously recommends that shareholders vote in favour of this Resolution.

Voting Exclusions

The Company will disregard any votes cast in favour of Resolution 9 by any person who may participate in the proposed issue or any person who might obtain a material benefit, except a benefit solely in the capacity of a holder of ordinary shares, and any associate of such person.

11

GLOSSARY

The following terms have the following meanings in this Explanatory Statement:

“ $ ” means Australian Dollars;

“ 10% Placement Facility ” has the meaning as defined in the Explanatory Statement for Resolution 9;

“ 10% Placement Period ” has the meaning as defined in the Explanatory Statement for Resolution 9;

“ Annual Report ” means the Directors’ Report, the Financial Report, and Auditor’s Report, in respect to the year ended 30 June 2018;

“ ASX ” means ASX Limited ABN 98 008 624 691 or the Australian Securities Exchange, as the context requires;

“ ASX Settlement Operating Rules ” means the rules of ASX Settlement Pty Ltd which apply while the Company is an issuer of CHESS approved securities;

“ Auditor’s Report ” means the auditor’s report on the Financial Report;

“ AEDT ” means Australian Eastern Daylight Time.

“ Board ” means the Directors acting as the board of Directors of the Company;

“ Chairman ” means the person appointed to chair the Meeting of the Company convened by the Notice;

“ CHESS ” has the meaning in Section 2 of the ASX Settlement Operating Rules ;

“ Closely Related Party ” means:

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

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

“ Company ” means Cue Energy Resources Limited ABN 45 066 383 971;

“ Constitution ” means the constitution of the Company as at the date of the Meeting;

“ Corporations Act ” means the Corporations Act 2001 (Cth);

“ Director ” means a Director of the Company;

“ Directors Report ” means the annual directors’ report prepared under Chapter 2M of the Corporations Act for the Company and its controlled entities;

“ Equity Security ” has the same meaning as in the Listing Rules;

“ Explanatory Memorandum ” means the explanatory memorandum which forms part of the Notice;

“ Financial Report ” means the annual financial report prepared under Chapter 2M of the Corporations Act for the Company and its controlled entities;

“ Key Management Personnel ” means persons having authority and responsibility for planning, directing and controlling the activities of the Company, directly or indirectly, including any Director (whether executive or otherwise) of the Company;

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

“ Meeting ” has the meaning given in the introductory paragraph of the Notice;

“ Notice ” means this Notice of Meeting including the Explanatory Statement;

“ Proxy Form ” means the proxy form attached to the Notice;

“ Remuneration Report ” means the remuneration report which forms part of the Directors’ Report of the Company for the financial year ended 30 June 2018 and which is set out in the 2018 Annual Report.

“ Resolution ” means a resolution referred to in the Notice;

“ Section ” means a section of the Explanatory Memorandum;

“ Share ” means a fully paid ordinary share in the capital of the Company;

“ Shareholder ” means shareholder of the Company;

“ Trading Day ” means a day determined by ASX to be a trading day in accordance with the Listing Rules;

“ VWAP ” means volume weighted average price.

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Lodge your vote:

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
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Online:

www.investorvote.com.au



By Mail:

Computershare Investor Services Pty Limited GPO Box 242 Melbourne Victoria 3001 Australia

CUERM

MR RETURN SAMPLE 123 SAMPLE STREET SAMPLE SURBURB SAMPLETOWN VIC 3030

Alternatively you can fax your form to (within Australia) 1800 783 447 (outside Australia) +61 3 9473 2555

For Intermediary Online subscribers only (custodians) www.intermediaryonline.com

For all enquiries call:

(within Australia) 1300 850 505 (outside Australia) +61 3 9415 4000

Proxy Form

XX

Vote and view the annual report online



• Go to www.investorvote.com.au or scan the QR Code with your mobile device.

• • Follow the instructions on the secure website to vote.

Your access information that you will need to vote:

Control Number: 999999

PIN: 99999

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PLEASE NOTE: For security reasons it is important that you keep your SRN/HIN confidential.

 For your vote to be effective it must be received by 9:30am (AEDT) Sunday 28 October 2018

How to Vote on Items of Business

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

Appointment of Proxy

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

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

Appointing a second proxy: You are entitled to appoint up to two proxies to attend the meeting and vote on a poll. If you appoint two proxies you must specify the percentage of votes or number of securities for each proxy, otherwise each proxy may exercise half of the votes. When appointing a second proxy write both names and the percentage of votes or number of securities for each in Step 1 overleaf.

A proxy need not be a securityholder of the Company.

Signing Instructions for Postal Forms

Individual: Where the holding is in one name, the securityholder must sign.

Joint Holding: Where the holding is in more than one name, all of the securityholders should sign.

Power of Attorney: If you have not already lodged the Power of Attorney with the registry, please attach a certified photocopy of the Power of Attorney to this form when you return it.

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

Attending the Meeting

Bring this form to assist registration. If a representative of a corporate securityholder or proxy is to attend the meeting you will need to provide the appropriate “Certificate of Appointment of Corporate Representative” prior to admission. A form of the certificate may be obtained from Computershare or online at www.investorcentre.com under the help tab, "Printable Forms".

Comments & Questions: If you have any comments or questions for the company, please write them on a separate sheet of paper and return with this form.

GO ONLINE TO VOTE,  or turn over to complete the form

Samples/000002/000002

MR RETURN SAMPLE 123 SAMPLE STREET SAMPLE SURBURB SAMPLETOWN VIC 3030

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Change of address. If incorrect, mark this box and make the correction in the space to the left. Securityholders sponsored by a broker (reference number commences with ‘ X ’) should advise your broker of any changes.

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
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I ND

Proxy Form

Appoint a Proxy to Vote on Your Behalf

Please mark to indicate your directions

XX

I/We being a member/s of Cue Energy Resources Limited hereby appoint

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the Chairman of the Meeting

OR

 PLEASE NOTE: Leave this box blank if you have selected the Chairman of the Meeting. Do not insert your own name(s).

or failing the individual or body corporate named, or if no individual or body corporate is named, the Chairman of the Meeting, as my/our proxy to act generally at the Meeting on my/our behalf and to vote in accordance with the following directions (or if no directions have been given, and to the extent permitted by law, as the proxy sees fit) at the Annual General Meeting of Cue Energy Resources Limited to be held at the offices of BDO, Tower 4, 727 Collins Street, Melbourne, Victoria, 3008 at 9:30am (AEDT) on Tuesday, 30 October 2018 and at any adjournment or postponement of that Meeting.

Chairman authorised to exercise undirected proxies on remuneration related resolutions : Where I/we have appointed the Chairman of the Meeting as my/our proxy (or the Chairman becomes my/our proxy by default), I/we expressly authorise the Chairman to exercise my/our proxy on Resolution 1 (except where I/we have indicated a different voting intention below) even though Resolution 1 is connected directly or indirectly with the remuneration of a member of key management personnel, which includes the Chairman.

Important Note: If the Chairman of the Meeting is (or becomes) your proxy you can direct the Chairman to vote for or against or abstain from voting on Resolution 1 by marking the appropriate box in step 2 below.

Items of Business  PLEASE NOTE: If you mark the Abstain box for an item, you are directing your proxy not to vote on your behalf on a show of hands or a poll and your votes will not be counted in computing the required majority.

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Resolution 1: Adoption of Resolution 6: Election of Mr
Remuneration Report Richard Malcolm as a
Director of the
Resolution 2: Election of Mr Company
Alastair McGregor as
a Director of the Resolution 7: Election of Mr
Company Roderick Ritchie as a
Director of the
Resolution 3: Election of Mr Company
Andrew Jefferies as a
Director of the Resolution 8: Election of Mr
Company Samuel Kellner as a
Director of the
Resolution 4: Election of Mr Peter Company
Hood as a Director of
the Company Resolution 9: Approval of 10%
Placement Facility
Resolution 5: Election of Ms
Rebecca DeLaet as a
Director of the
Company
For Against Abstain For Against Abstain
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The Chairman of the Meeting intends to vote undirected proxies in favour of each item of business. In exceptional circumstances, the Chairman of the Meeting may change his/her voting intention on any resolution, in which case an ASX announcement will be made.

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SIGN
Signature of Securityholder(s) This section must be completed.
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Individual or Securityholder 1 Securityholder 2 Securityholder 3
Sole Director and Sole Company Secretary Director Director/Company Secretary
Contact
Contact Daytime / /
Name Telephone Date
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C U E

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