ENVIRONMENTAL CLEAN TECHNOLOGIES LIMITED. — Proxy Solicitation & Information Statement 2009

Feb 1, 2009

Environmental Clean Technologies Limited

ABN 28 009 120 405

General Meeting to offer share purchase plan

Monday, 2 February 2009: Shareholders in Environmental Clean Technologies (ASX: ESI) will be invited to participate in a share purchase plan (SPP) at a General Meeting in Melbourne next month.

The SPP, expected to be finalised by the end of March 2009, will give shareholders the opportunity to subscribe for up to $5000 in shares. The shares will be offered at 2c per share, with two free attaching options that will be exercisable at the same price.

Chief Executive Kos Galtos said the company was in active discussions with potential underwriters, with Fiori Pty Ltd already committed to partially participate.

“Once ESI has complied with Chapter 2 of the ASX Listing Rules, we will apply for all of the Options to be listed for quotation on the ASX,” he said.

ESI will also seek shareholder approval for the purchase of the Coldry intellectual property.

“Purchasing the IP for Coldry has long been an aim of the company to ensure the technology is commercialised, to cement our strategic alliances and ultimately to meet our sales objectives,” Galtos said.

Shareholders are encouraged to attend the General Meeting, details are:

Date: Wednesday 4 March 2009 Time: 11 am Venue: Deacons Lawyers RACV Tower, 485 Bourke Street Melbourne VIC 3000

The attached Notice of Meeting and proxy form will be mailed today, Monday 2 February 2009.

For further information contact; Chief Executive Kos Galtos +61 (0)3 9684 0888.

Coldry Process

The world’s first economic method for dewatering brown coal, creating a high energy pellet with significantly reduced CO2 emissions compared to brown coal, while being suitable for export as a black coal substitute.

Matmor Process

A one-step method for producing low-carbon iron from inexpensive, abundant brown coals and metal bearing media such as mill scale, nickel tailings and low grade iron ore.

Level 1, 530 Little Collins Street � Melbourne � Victoria 3000 � Australia � +61(0)3 96840888 � www. ectltd.com.au

Environmental Clean Technologies Limited

ABN 28 009 120 405

NOTICE OF GENERAL MEETING AND EXPLANATORY MEMORANDUM

TO BE HELD AT:

Deacons

Level 15, RACV Tower, 485 Bourke Street, Melbourne, Victoria

At 11.00 am on Wednesday, 4 March 2009

TO BE VALID, THE PROXY FORM ENCLOSED FOR USE AT THE MEETING MUST BE COMPLETED AND RETURNED NO LATER THAN 11.00 AM ON 2 MARCH 2009

IMPORTANT

This document is important and requires your immediate attention. It should be read in its entirety. If you are in doubt as to the course you should follow, you should consult your legal, financial or other professional adviser immediately.

Contents

Chairman’s Letter .............................................................................................................................................. 2 Notice of General Meeting................................................................................................................................. 3 Explanatory Memorandum ................................................................................................................................ 6 Glossary...................................................................................................................... . ................................... 11 Annexure - Summary of the Convertible Notes’ Terms and Conditions.......................................................... 12

A proxy form is enclosed separately

Environmental Clean Technologies Limited

Chairman’s Letter

2 February 2009

Dear Shareholder

On 23 January 2009 the Company announced that it had entered into a non-binding Term Sheet for the acquisition of full ownership of the intellectual property rights in the Coldry technology. This acquisition is a strategic milestone for the Company that significantly enhances its intellectual property rights and control over the Coldry technology, and its ability to develop and commercialise the technology.

Under the formal agreements that are now being negotiated it is proposed that the Company will purchase the units in the Coldry Trust and the shares in its trustee, Maddingley Coldry, to acquire the Coldry technology currently only licensed to a subsidiary of the Company. The purchase price will comprise $1 million in cash, 55 million shares in the Company and 110 million options exercisable at 2 cents. The purchase price will be increased at the time the intellectual property is successfully commercialised, as described in more detail in the Explanatory Memorandum.

The Company previously foreshadowed a capital raising comprising a share purchase plan (SPP) which will provide the cash required for the acquisition and to further progress development of the Coldry demonstration plant, as well as permitting Shareholders to participate in the capital raising on the same terms as the placement to Fiori Pty Ltd announced on 16 January 2009. The SPP will be partially underwritten.

A General Meeting of shareholders will be held on 4 March 2009 to consider and if thought fit approve the SPP, the placement, the issue of Shares and Options in connection with the acquisition of the Coldry technology, the underwriting arrangements and associated transactions.

Full details of the resolutions and the reasons for them being proposed are set out in the attached Notice of Meeting and Explanatory Memorandum.

These are exciting developments for the Company. The Chief Executive, Kos Galtos will give a detailed presentation at the meeting on the Coldry acquisition and the Company’s plans for its commercialisation, including steps being taken towards construction of the Coldry demonstration plant.

I encourage you to read the Notice of Meeting and Explanatory Memorandum in full and look forward to seeing you at the General Meeting on 4 March 2009.

Yours sincerely

Dave Woodall Chairman

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Environmental Clean Technologies Limited

Notice of General Meeting

A General Meeting of Environmental Clean Technologies Limited ACN 009 120 405 will be held at Deacons, Level 15, RACV Tower, 485 Bourke Street, Melbourne, Victoria, on 4 March 2009 at 11.00 am, Melbourne time.

AGENDA

ORDINARY BUSINESS

The business of the Meeting is to consider and, if thought fit, pass the following resolutions:

1. Resolution 1 - Issue of Shares and Options to Coldry Trust Unitholder

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

That for the purposes of ASX Listing Rule 7.1 and for all other purposes, Shareholders approve the issue of 55,000,000 Shares and 110,000,000 Options to the Coldry Unitholder (details of which are set out in the Explanatory Memorandum) or its nominees, on the terms set out in the Explanatory Memorandum accompanying and forming part of this Notice of Meeting.

1. Resolution 2 - Issue of Shares and Options under Share Purchase Plan

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

That for the purposes of ASX Listing Rule 7.1 and all other purposes, Shareholders approve the issue of Shares and Options under the share purchase plan (SPP) (details of which are set out in the Explanatory Memorandum accompanying and forming part of this Notice of Meeting).

3. Resolution 3 - Underwriting of Share Purchase Plan

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

That, subject to the passing of resolution 2, for the purpose of ASX Listing Rule 7.1 and for all other purposes, Shareholders approve an issue of Shares and Options to the underwriters of the SPP under the arrangements for underwriting the SPP (details of which arrangements are set out in the Explanatory Memorandum accompanying and forming part of this Notice of Meeting).

1. Resolution 4 - Issue of 11,000,000 Shares and 32,000,000 Options to Fiori

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

That for the purposes of ASX Listing Rule 7.4 and for all other purposes, Shareholders approve the issue of 11,000,000 Shares and 32,000,000 Options to Fiori Pty Ltd on 16 January 2009 on the terms set out in the Explanatory Memorandum accompanying and forming part of this Notice of Meeting.

1. Resolution 5 - Fortrend Drawdowns

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

That for the purposes of ASX Listing Rule 7.4 and for all other purposes, Shareholders approve the issue of:

a) 3,848,425 Shares and 962,106 options to HSBC Custody Nominees (Australia) Limited on 14 November 2008; and

• b) 1,443,995 Shares and 360,999 options to HSBC Custody Nominees (Australia) Limited on 23 December 2008,

on the terms set out in the Explanatory Memorandum accompanying and forming part of this Notice of Meeting.

6. Resolution 6 – Issue of Convertible Notes

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

“That, for the purposes of ASX Listing Rule 7.1 and for all other purposes, shareholders approve the issue of up to 3 Tranches of Convertible Notes to Pacific Capital Value Fund (with a value per Tranche of $500,000) and the issue of fully paid ordinary shares in the Company upon the conversion of those Convertible Notes (as determined under the terms of the Convertible Notes) on the terms and conditions described in the Explanatory Memorandum accompanying and forming part of this Notice of Meeting.

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Environmental Clean Technologies Limited

Other Business

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

Voting exclusion statement

As required by the ASX Listing Rules, the Company will disregard the votes cast on:

• (1) Resolution 1 by the Coldry Unitholder and any other person who may be issued with Shares and Options approved for issue under Resolution 1 and their associates;

• (2) Resolution 3 by Alex Elberg and Fiori and their associates;

• (3) Resolution 4 by Alex Elberg and Fiori and their associates;

• (4) Resolution 5 by HSBC Custody Nominees and their associates; and

• (5) Resolution 6 by Pacific Capital Value Fund and their associates,

however, the Company need not disregard a vote if:

• a) it 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

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

Explanatory Memorandum

The accompanying Explanatory Memorandum forms part of this Notice of General Meeting and should be read in conjunction with it. A Glossary of terms used in this Notice of General Meeting and Explanatory Memorandum is in the Explanatory Memorandum

By order of the Board

Kosmas Galtos Chief Executive 2 February 2009

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Environmental Clean Technologies Limited

NOTES REGARDING PROXIES AND VOTING

Appointing a proxy

A Shareholder who is entitled to attend and vote can appoint a proxy to attend and vote at the Meeting on their behalf. A proxy need not be a Shareholder. If a Shareholder has lodged a proxy, they are still entitled to attend and ask questions at the Meeting.

A Shareholder entitled to cast two or more votes may appoint two proxies and may specify the proportion or number of votes each proxy is appointed to exercise. If proportions or numbers are not specified, each proxy may exercise half the available votes.

For an appointment of a proxy to be effective, the proxy's appointment (and, if the appointment is signed by an attorney, the authority under which it was signed or a certified copy of the authority) must be received by Environmental Clean Technologies’ share registry by 11.00 am on 2 March 2009.

A proxy form is included with this Notice. If you require a second proxy form, please contact Environmental Clean Technologies’ share registry or you may copy the proxy form.

Proxy forms may be lodged by posting, delivery or facsimile to Environmental Clean Technologies Limited as follows:

Security Transfer Registrars Pty Ltd 770 Canning Highway

Applecross, Western Australia 6153

Facsimile: (08) 9315 2233

Email: registrar@securitytransfer.com.au

Corporate Shareholders

Corporate Shareholders wishing to appoint a representative to attend the Meeting on their behalf must provide that person with a properly executed letter confirming that they are authorised to act as the company's representative. The authorisation may be effective either for this Meeting only or for all meetings of Environmental Clean Technologies.

Eligibility to vote at the Meeting

For the purpose of Regulation 7.11.37 of the Corporations Regulations 2001 , Environmental Clean Technologies has determined, for the purposes of voting entitlements at the Meeting, that Environmental Clean Technologies’ shares are taken to be held by those Shareholders registered at 7pm on 2 March 2009 (the Record Date ). Accordingly, only those persons will be entitled to attend and vote at the Meeting.

Registration

If you are attending the Meeting, please bring your personalised proxy form with you. If you do not bring your form with you, you will still be able to attend the Meeting, but on registration, representatives from the Company’s share registry will need to verify your identity.

How undirected proxies held by the Chairman of the Meeting will be voted

The Chairman of Environmental Clean Technologies will chair the Meeting and will vote undirected proxies in favour of each Resolution. Environmental Clean Technologies encourages all Shareholders who submit proxies to direct their proxy how to vote on the Resolutions.

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Environmental Clean Technologies Limited

Explanatory Memorandum

This Explanatory Memorandum (which is included in, and forms part of, the Notice of General Meeting) is provided to Shareholders to explain the resolutions to be put to Shareholders at the General Meeting and to assist Shareholders to determine how they wish to vote on the resolutions. The General Meeting will be held at Deacons, Level 15, RACV Tower, 485 Bourke Street, Melbourne, Victoria on 4 March 2009 at 11.00 am, Melbourne time.

Coldry acquisition

The Company has wished for some time to acquire full ownership of the Coldry IP, which the directors believe will considerably enhance its ability to commercialise the technology. The opportunity to acquire full ownership of the technology has now arisen and on 23 January 2009 the Company signed a non-binding Term Sheet for acquisition of all of the units in the Coldry Trust ( Coldry Units ) and the shares in Maddingley Coldry ( Coldry Shares ). Under the formal agreements that are now being negotiated, it is proposed that the Company will purchase all of the units in the Coldry Trust, and the shares in the trustee of the Coldry Trust, Maddingley Coldry. Maddingley Coldry currently licenses the Coldry technology to Asia Pacific Coal and Steel, a wholly owned subsidiary of the Company. The purchase price will comprise $1 million in cash, 55 million shares in the Company ( Shares ) and 110 million options exercisable at 2 cents ( Options ). The purchase price will be increased, by up to a maximum of $3 million when the Coldry product is produced and sold by the Company or an entity licensed by the Company, in which case an additional $0.50 per tonne out of the proceeds of the sale of the Coldry product will be paid. The Company will also meet the existing royalty obligation of 30 cents per tonne for 20 years. The relevant terms of the formal agreements may differ from those outlined above.

The Company wishes to seek Shareholder approval for the issue of these Shares and Options to the Coldry Unitholder (described below) or its nominee as part payment of the purchase price.

Capital raising

The Company previously foreshadowed a capital raising comprising a share purchase plan ( SPP ) which will provide the cash required for the acquisition of the Coldry technology and to further progress development of the Coldry demonstration plant, as well as permitting Shareholders to participate in the capital raising on the same terms as the placement to Fiori Pty Ltd ( Fiori ) announced on 16 January 2009 ( Fiori Placement ). The SPP will be fully or partially underwritten.

Fortrend facility

The Company seeks Shareholder approval for the issue of Shares and options under the existing Fortrend equity line of credit in November and December 2008.

Pacific Capital facility

The Company seeks Shareholder approval for the potential issue of 3 Tranches of Convertible Notes to Pacific Capital under the Subscription Agreement dated 18 November 2008.

1. Resolution 1 – Issue of 55,000,000 Shares and 110,000,000 Options to Coldry Trust Unitholder This resolution is to approve the issue of Shares and Options as part payment of the purchase price for the Coldry technology.

In accordance with ASX Listing Rule 7.3, the following information is provided for Shareholders with respect to the issue of Shares and Options to the Coldry Unitholder or its nominee:

1. The number of securities to be allotted is 55,000,000 Shares and 110,000,000 Options.

2. The securities will be issued no later than 3 months after the date of the Meeting.

3. The price for the securities is part payment of the consideration for the purchase of the Coldry Units and the Coldry Shares. The value attributed by the Company to the 55,000,0000 Shares and 110,000,000 Options is $1,100,000.

4. The terms of the securities are that the Shares are fully paid ordinary shares in the Company and the Options are exercisable for Shares at 2 cents per Share and expire on 16 January 2014.

5. The name of the allottee is JBD Industrial Park Pty Ltd ACN 088 750 574 (being the Coldry Unitholder), or its nominees.

6. No funds will be raised by the issue of the securities. The issue is part payment of the consideration for the purchase of the Coldry Units and the Coldry Shares.

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Environmental Clean Technologies Limited

2. Resolution 2 - Share Purchase Plan

The Company is proposing to offer Shares and Options under a share purchase plan ( SPP ) under which Shareholders will be entitled to apply for up to $5,000 worth of Shares at 2 cents per Share and receive 2 attached free Options on the same terms as the Fiori Placement (see Resolution 4). Because the SPP includes an offer of options as well as shares, it will not comply with Exception 15 in ASX Listing Rule 7.2. Unless this or one of the other exceptions to Listing Rule 7.1 applies, Listing Rule 7.1 limits the number of securities that a company may issue or agree to issue in any 12 month period to 15% of its issued securities. Another exception to Listing Rule 7.1 applies, which is an issue of securities with shareholder approval (Exception 14), and this is the reason for Resolution 2.

The SPP will be offered to Shareholders on the terms set out above. The record date for the SPP will be advised if and when Shareholder approval is obtained for the SPP under this resolution.

In accordance with ASX Listing Rule 7.3, the following information is provided for Shareholders with respect to the SPP:

1. The number of securities to be issued is 898,500,000 Shares and 1,797,000,000 Options. This is the maximum number of Shares and Options that would be issued under the SPP if all 3,594 shareholders (as on the Company’s share register at 23 January 2008) took up their full entitlements to $5,000 worth of Shares.

2. The securities will be issued no later than 3 months after the date of the Meeting.

3. The price for the securities is 2 cents per Share and $0 per Option.

4. The terms of the securities are that the Shares are fully paid ordinary shares in the Company and the Options are exercisable for Shares at 2 cents per Share and expire on 16 January 2014.

5. The allottees will be those Shareholders who apply for Shares in the SPP or the underwriters if applicable (see Resolution 3 below).

6. The funds to be raised will be used to provide the cash required for the Coldry acquisition and to further progress development of the Coldry demonstration plant.

Normally the ASX Listing Rules would require a Voting Exclusion Statement to apply to a resolution such as Resolution 2. The Company has applied for a waiver from this requirement and expects that the waiver will be granted by the time of the Meeting. The Chairman will inform Shareholders as to the status of the waiver application at the Meeting.

3. Resolution 3 - Underwriting Share Purchase Plan

The Company is in the process of making arrangements for the underwriting of the SPP. As at the date of this Notice of Meeting, the Company has a commitment from Fiori to underwrite $500,000 of the SPP. Under this commitment, Fiori must subscribe for up to $500,000 Shares at 2 cents per Share if the maximum subscription of 898,500,000 Shares under the SPP is not taken up (i.e. if there is any shortfall).

The Company is negotiating with other potential underwriters to obtain similar underwriting commitments. The Company expects that in those cases, the underwriter will be paid a fee, in cash, of up to 10% of the amount underwritten under the SPP.

Shares and Options issued to the underwriters in these circumstances will not comply with any of the exceptions to ASX Listing Rule 7.1 in ASX Listing Rule 7.2. Unless this or one of the other exceptions to Listing Rule 7.1 applies, Listing Rule 7.1 limits the number of securities that a company may issue or agree to issue without shareholder approval in any 12 month period to 15% of its issued securities. Another exception to Listing Rule 7.1 applies is an issue of securities with shareholder approval (Exception 14), and this is the reason for Resolution 3.

In accordance with ASX Listing Rule 7.3, the following information is provided for Shareholders with respect

to the underwriting arrangements.

1. The number of securities to be issued is up to 898,500,000 Shares and 1,797,000,000 Options. This would occur if the SPP was fully underwritten and no Shareholders applied for any Shares and Options under the SPP.

2. The securities will be issued no later than 3 months after the date of the Meeting.

3. The price for the securities is 2 cents per Share and $0 per Option.

4. The terms of the securities are that the Shares are fully paid ordinary shares in the Company and the Options are exercisable for Shares at 2 cents per Share and expire 5 years from the date of issue.

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Environmental Clean Technologies Limited

1. The allottees will be the underwriters to the SPP, including Fiori.

2. The funds to be raised under the SPP will be used to provide the cash required for the acquisition of the Coldry IP and to further progress development of the Coldry demonstration plant.

4. Resolution 4 – Issue of 11,000,000 Shares and 32,000,000 Options to Fiori

On 16 January 2009 Environmental Clean Technologies issued 11,000,000 Shares and 32,000,000 Options to Fiori Pty Ltd (Fiori).

Unless one of the exceptions to Listing Rule 7.1 applies, Listing Rule 7.1 limits the number of securities that a company may issue or agree to issue without shareholder approval in any 12 month period to 15% of its issued securities. Under Listing Rule 7.4, issues subsequently approved by Shareholders are excluded from the 15% calculation, and this is the reason for Resolution 4.

In accordance with ASX Listing Rule 7.5, the following information is provided for Shareholders with respect to the Fiori Placement:

1. The number of securities allotted was 11,000,000 Shares and 32,000,000 Options.

2. The price for the securities was $220,000 for the Shares and $0 for the Options.

3. The terms of the securities issued were that the Shares were ordinary fully paid ordinary shares in the Company and the Options are exercisable for Shares at 2 cents per Share and expire 16 January 2014.

4. The name of the allottee was Fiori.

5. The funds were raised to fund the commercial operations of the Company. 22,000,000 Options were issued to Fiori on a 2 for 1 basis with respect to the 11,000,000 Shares issued. 10,000,000 Options were issued to Fiori as part of the consideration for the Fiori Placement, the commitment to subscribe for an additional placement of 5,000,000 Shares if requested by the Company, and the commitment to underwrite the SPP.

5. Resolution 5 - Fortrend Drawdowns

In the general meeting on 10 October 2007 shareholders approved a $15,000,000 equity line of credit provided by Fortrend Securities Pty Ltd ( Fortrend ) via a Standby Subscription Agreement. The amount of capital raised and the equity consideration are unknown at the time of each draw down as a formula based on the VWAP applies. This resolution approves the issues of Shares and options that have been made under the Fortrend equity line of credit since the Notice of Meeting for the Annual General Meeting on 18 November 2008 was posted to Shareholders, enabling restoration of the 15% limit in ASX Listing Rule 7.1.

On 14 November 2008, the Company issued 3,848,425 Shares and 962,106 options to HSBC Custody Nominees (Australia) Limited ACN 003 094 568 ( HSBC Custody Nominees ) via a drawdown notice under the Standby Subscription Agreement with Fortrend dated 31 August 2007. On 23 December 2008, the Company issued 1,443,995 Shares and 360,999 options to HSBC Custody Nominees via a drawdown notice under the Standby Subscription Agreement with Fortrend dated 31 August 2007. The equity issued was reflected in the Appendix 3Bs lodged with the ASX on 17 November 2008 and 29 December 2008.

Unless one of the exceptions to Listing Rule 7.1 applies, Listing Rule 7.1 limits the number of securities that a company may issue or agree to issue without shareholder approval in any 12 month period to 15% of its issued securities. Under Listing Rule 7.4, issues subsequently approved by Shareholders are excluded from the 15% calculation, and this is the reason for Resolution 5.

In accordance with ASX Listing Rule 7.5, the following information is provided for Shareholders with respect to the 14 November 2008 issue:

1. The number of securities allotted was 3,848,425 Shares and 962,106 options.

2. The price for the securities was $119,493.60 for the Shares and $0 for the options.

3. The terms of the securities issued were that the Shares were fully paid ordinary shares in the Company and the options are exercisable for Shares at 3.795c per Share and expire 14 November 2011.

4. The name of the allottee was HSBC Custody Nominees.

5. The funds were raised to fund the operations of the Company.

In accordance with ASX Listing Rule 7.5, the following information is provided for Shareholders with respect to the 23 December 2008 issue:

1. The number of securities allotted was 1,443,995 Shares and 360,999 options.

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Environmental Clean Technologies Limited

1. The price for the securities was $37,948.19 for the Shares and $0 for the options.

2. The terms of the securities issued were that the Shares were fully paid ordinary shares in the Company and the options are exercisable for Shares at 3.212 cents per Share and expire 23 December 2011.

3. The name of the allottee was HSBC Custody Nominees.

4. The funds were raised to fund the operations of the Company.

6. Resolution 6 – Issues of Convertible Notes

Environmental Clean Technologies has entered into an equity financing arrangement with Pacific Capital Value Fund and its manager Pacific Capital Management Limited ( Pacific Capital ). Under the Subscription Agreement dated 18 November 2008, Environmental Clean Technologies will issue Convertible Notes to Pacific Capital upon subscription for the Convertible Notes by Pacific Capital.

The number of Convertible Notes proposed to be issued may exceed the 15% limit in Listing Rule 7.1 of the ASX Listing Rules. This limit does not apply to an issue approved by shareholders, and accordingly the Company is seeking Shareholder approval for the issue of the Convertible Notes and the Shares to be issued on conversion of the Convertible Notes.

The arrangements with Pacific Capital are expected to result in a total capital raising of $10 million exclusive of costs and fees payable to Pacific Capital and the Company’s corporate advisers, over a maximum 36 month period.

The Convertible Notes will be issued in Tranches of $500,000 each. Resolution 6 is to approve the issue of up to 3 Tranches of Convertible Notes. As foreshadowed in the General Meeting on 10 September 2008 and the Annual General Meeting on 18 November 2008, the Directors are seeking Shareholder approval for additional issues of Convertible Notes over the next three months if Pacific Capital subscribes for the Convertible Notes. Shareholder approval is only required for the issue of Convertible Notes if the issue crosses the 15% threshold in ASX Listing Rule 7.1. Accordingly, a number of Tranches may be issued without further Shareholder approval.

Information required for shareholder approval

In accordance with ASX Listing Rule 7.3, the following information is provided for shareholders:

1. The number of Convertible Notes that will be issued with Shareholder approval under Resolution 6 will be up to 3 Tranches of $500,000.

The Company proposes to issue a maximum of $10 million of Convertible Notes to Pacific Capital, via a total of 20 Tranches, each with a denomination of $500,000 over a period of 36 months. The maximum number of Shares that the Company will issue on conversion of the Convertible Notes is 666,666,667 Shares, based on the minimum conversion price of the Convertible Notes being 1.5 cents.

The conversion price is at the discretion of Pacific Capital either:

• i. 125% of 30 day VWAP (broadly, at the time of issue of the Convertible Notes); or

• ii. 90% of the VWAP per share on any 5 consecutive trading days (selected by Pacific Capital) during the 30 days immediately preceding conversion,

with a 1.5 cent minimum conversion price.

1. All of the Convertible Notes approved under Resolution 6 will be issued within 3 months of the date of the Meeting (i.e. no later than 4 June 2009).

2. The issue price of the Convertible Notes is $500,000 per Tranche.

3. The allottee of the Convertible Notes is Pacific Capital Value Fund or a related body corporate of Pacific Capital Value Fund.

4. The terms of the Convertible Notes are described below.

5. The funds raised by the issue of the Convertible Notes will be used for:

6. a. further commercialisation of the Coldry technology, including ongoing feasibility studies and design work for the proposed 150,000 tonne demonstration plant;

7. b. preparation for a further capital raising to fund the acquisition of the Coldry technology and construction of the demonstration plant;

8. c. further development of the Matmor technology; and

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Environmental Clean Technologies Limited

• d. increasing the Company’s human resources particularly by recruiting a Product Manager, a Business Development Manager and specialised sales support staff. The new staff will be devoted primarily to the commercialisation of the Coldry technology.

Terms of the Convertible Notes

The Convertible Notes are convertible redeemable debt securities with no coupon (i.e. no interest is payable on them). On conversion Pacific Capital is to be issued with Shares which are to be listed on ASX. Convertible Notes which are not converted must be redeemed by the Company at 100% of their principal amount on the Final Maturity Date, which is 36 months after the Tranche 1 subscription date, i.e. 18 December 2011.

The Convertible Notes may be converted into Shares any time before the Final Maturity Date. There are several variables applicable to the conversion price (discussed above).

Pacific Capital and 2 major Shareholders of the Company have entered into Share Lending Agreements for 3 years with respect to 10,000,000 Shares, placed with Pacific Capital’s nominated custodian, Minter Ellison. The Company will issue Shareholders who lend their Shares further shares totalling 5% of the number they lend per annum (so a lender of 100,000 Shares will receive them back at the end of the 3 year period and will also receive 5,000 Shares each year by way of a facilitation payment).

A further summary of the terms of the Convertible Notes is contained in the Annexure. The full terms and conditions of the Convertible Notes can be obtained from the Environmental Clean Technologies’ website at www.ectltd.com.au or the ASX website at www.asx.com.au. Shares issued on conversion of the Convertible Notes will have the same terms and rank equally with existing issued Shares and will be quoted by the ASX.

Recommendation

The Board unanimously recommends that Shareholders vote in favour of the Resolutions.

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Glossary

In this Notice and Explanatory Memorandum:

ASX means ASX Limited ACN 008 624 691;

ASX Listing Rules means the listing rules of the ASX;

Australian Pacific Coal and Steel means Australian Pacific Coal and Steel Pty Ltd ACN 111 577 041;

Board means the board of Directors;

Coldry is the technology used by the Company to dewater brown coal;

Coldry Shares means all of the shares in Maddingley Coldry Pty Ltd ACN 109 941 175, the trustee of the Coldry Trust;

Coldry Trust means the Maddingley Coldry Unit Trust constituted by a trust deed dated 7 July 2004;

Coldry Unitholder means the unitholder in the Coldry Trust, being JBD Industrial Park Pty Ltd ACN 088 750 574;

Coldry Units means all of the units in the Coldry Trust;

Convertible Notes means the convertible notes issued, and proposed to be issued, by the Company to Pacific Capital;

Corporations Act means the Corporations Act 2001 (Cth);

Directors mean the directors of the Company from to time;

Explanatory Memorandum means the explanatory memorandum which accompanies, and is incorporated as part of, the Notice of Meeting;

Environmental Clean Technologies or Company means Environmental Clean Technologies Limited ACN 009 120 405;

Final Maturity Date means that date that is 36 months from Pacific Capital’s subscription for the first Tranche of Convertible Notes, i.e. 18 December 2011;

Fiori means Fiori Pty Ltd ACN 007 208 335;

Fiori Placement means the issue of 11,000,000 Shares and 32,000,000 Options to Fiori on 16 January 2009;

Fortrend means Fortrend Securities Pty Ltd ACN 055 702 693;

General Meeting and Meeting mean the general meeting of the Company to be held at 11.00 am on 4 March 2009;

HSBC Custody Nominees means HSBC Custody Nominees (Australia) Limited ACN 003 094 568;

Maddingley Coldry means Maddingley Coldry Pty Ltd ACN 109 941 175;

Options means options that are exercisable at any time up to 5:00 pm AEST on 16 January 2014 at a price of 2 cents for 1 Share;

Pacific Capital means Pacific Capital Value Fund, and its manager Pacific Capital Investment Management Limited Company No. 05836809, of 39 James Street, London, UK SW1 A1JD;

Record Date means the record date for determining Shareholders’ entitlements to vote at the Meeting;

Resolution means the resolution to be put to Shareholders at the Meeting, as set out in the Notice of General Meeting;

Shares means fully paid ordinary shares in the capital of the Company;

Shareholders means the legal owners of the Shares;

SPP means the share purchase plan outlined in paragraph 2 of the Explanatory Memorandum; and

VWAP means the volume weighted average price of Shares traded on the securities market operated by ASX.

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www.ectltd.com.au

Environmental Clean Technologies Limited

Annexure - Summary of the Convertible Notes’ Terms and Conditions

This is a summary only of the key principle features of the Convertible Notes. A full copy of the terms of the Convertible Notes will be able to be obtained from the Environmental Clean Technologies website at www.ectltd.com.au or the ASX website, www.asx.com.au.

Issuer Environmental Clean Technologies Limited The Convertible Notes 0.00% convertible notes due 2011. Interest Rate 0.00% per annum Conversion Right Pacific Capital has the absolute discretion at anytime from the respective Closing Dates of the Tranches up to the close of business on the day one week prior to the Final Maturity Date to decide on the dates to convert the Convertible Notes. Conversion Price Conversion Price is subject to variation at the discretion of the Purchaser: (1) 125% of 30 day VWAP (broadly, at the time of issue of the Convertible Notes); or (2) 90% of 5 /30 day VWAP on conversion, with a 1.5 cent minimum conversion price. Maturity Date The Final Maturity Date is 36 months from the date of subscription of the Tranche 1 Convertible Notes, i.e. 18 December 2011 Mandatory Redemption by the Company Convertible Notes which are not converted by Pacific Capital must be redeemed by the Issuer at 100% of their principal amount on the Final Maturity Date Use of Proceeds Further commercialisation of the Coldry technology, including ongoing feasibility studies and design work for the proposed 150,000 tonne demonstration plant. Preparation for a further capital raising to fund the acquisition of the Coldry technology and construction of the demonstration plant. Further development of the Matmor technology.

Increasing the Company’s human resources particularly by recruiting a Product Manager, a Business Development Manager and specialised sales support staff. The new staff will be devoted primarily to the commercialisation of the Coldry technology.

Page 12 of 12

www.ectltd.com.au

ENVIRONMENTAL CLEAN TECHNOLOGIES LIMITED

ABN 28 009 120 405

PROXY FORM

REGISTERED OFFICE:

SHARE REGISTRY: Security Transfer Registrars Pty Ltd All Correspondence to: PO BOX 535, APPLECROSS WA 6953 770 Canning Highway, APPLECROSS WA 6153 T: (08) 9315 2333 F: (08) 9315 2233 E: registrar@securitytransfer.com.au W: www.securitytransfer.com.au

niL 1 e niL 2 e niL 3 e niL 4 e niL 5 e niL 6 e

HIN/SRN No.: TYHdlo reN

ASX Code: Cm p

Meeting No.: 1

\

SECTION A: Appointment of Proxy

I/We being a member(s) of Environmental Clean Technologies Limited and entitled to attend and vote hereby appoint:

!

OR

The meeting Chairperson Name of the person you are appointing if this person is someone other than the Chairperson of the meeting. (mark with an “X”)

or failing the person named, or if no person is named, the Chairperson 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, as the Proxy sees fit) at the General Meeting of the Company to be held at 11.00am on Wednesday, 4 March 2009 at Deacons, Level 15, RACV Tower, 485 Bourke Street, Melbourne, Victoria and at any adjournment of that meeting.

SECTION B: Voting Directions to Your Proxy

Please mark with “X” in the box to indicate your voting directions to your Proxy:

ECTION B: Voting Directions to Your Proxy lease mark with “X” in the box to indicate your voting directions to your Proxy:	ECTION B: Voting Directions to Your Proxy lease mark with “X” in the box to indicate your voting directions to your Proxy:
Resolution		For	Against	Abstain*
1.	Issue of Shares and Options to Coldry Trust Unitholder	!	!	!
2.	Issue of Shares and Options under Share Purchase Plan	!	!	!
3.	Underwriting of Share Purchase Plan	!	!	!
4.	Issue of 11,000,000 Shares and 32,000,000 Options to Fiori	!	!	!
5.	Fortrend Drawdowns	!	!	!
6.	Issue of Convertible Notes	!	!	!

If no directions are given my proxy may vote as the proxy thinks fit or may abstain.

• 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.

!

If you wish to appoint the Chairperson as your Proxy and you do not wish to direct the Chairperson how to vote, please mark an “X” in the box. By marking this box, you acknowledge that the Chairperson may exercise your proxy even if he has an interest in the outcome of the resolution and votes cast by him other than as proxy holder will be disregarded because of that interest.

SCTION C: Please Sign Below

This section must be signed in accordance with the instructions overleaf to enable your directions to be implemented.

Individual or Security Holder 1 Sole Director and Sole Company Secretary	Security Holder 2 Director	Security Holder 3
		Director / Company Secretary

!

Change of Name or Address: If your registration details are incorrect, please mark this box and make the correction on this form.

Please note: CHESS sponsored holders must notify their sponsoring broker of the change. Your broker will notify the registry.

"

" Seq-Po/tsO s

PRX: 704

My/Our contact details in case of enquiries are: Contact Name

Contact Number

Shareholders are entitled to appoint up to two (2) Proxies (whether shareholders or not) to attend the meeting and vote on their behalf.

If you wish to appoint two (2) Proxies, please phone Security Transfer Registrars on +61 8 9315 2333 to obtain your second proxy form. Both forms must be completed with the nominated amount (number/percentage) clearly printed on each of the forms. If you do not specify the nominated amount, each Proxy may exercise half of your voting rights.

PLEASE RETURN BOTH OF THE FORMS TOGETHER.

NOTES

1. Name and Address

This is the name and address on the Share Register of Environmental Clean Technologies Limited. If this information is incorrect, please make corrections on this form. Shareholders sponsored by a broker should advise their broker of any changes. Please note that you cannot change ownership of your shares using this form.

2. Appointment of a Proxy

If you wish to appoint the Chairperson of the Meeting as your Proxy please mark ‘X’ in the box in Section A. Please also refer to Section B of this proxy form and ensure you mark the box in that section if you wish to appoint the Chairperson as your Proxy.

If the person you wish to appoint as your Proxy is someone other than the Chairperson of the Meeting please write the name of that person in Section A. If you leave this section blank, or your named Proxy does not attend the meeting, the Chairperson of the Meeting will be your Proxy. A Proxy need not be a Shareholder of Environmental Clean Technologies Limited.

5. Signing Instructions

Individual: where the holding is in one name, the Shareholder must sign.

Joint Holding : where the holding is in more than one name all of the Shareholders must sign.

Power of Attorney : to sign under Power of Attorney you must have already lodged this document with the Registry. If you have not previously lodged this document for notation, 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 may sign alone. Otherwise this form must be signed by a Director jointly with either another Director or Company Secretary. Please indicate the office held in the appropriate place.

3. Directing your Proxy how to vote

To direct the Proxy how to vote place an ‘X’ in the appropriate box against each item in Section B. Where more than one Proxy is to be appointed and the Proxies are to vote differently, then two separate forms must be used to indicate voting intentions.

If a representative of the corporation is to attend the meeting the appropriate “Certificate of Appointment of Corporate Representative” should be lodged with the Company before the meeting or at the registration desk on the day of the meeting. A form of the certificate may be obtained from the Company’s Share Registry.

4. Appointment of a Second Proxy

You are entitled to appoint up to two persons as proxies to attend the meeting and vote on a poll. If you wish to appoint a second Proxy an additional proxy form may be obtained by telephoning the Company’s Share Registry (08) 9315 2333 or you may photocopy this form.

To appoint a second Proxy you must:

• (a) On each of the first Proxy form and the second proxy form state the percentage of your voting rights or number of securities applicable to that form. If the appointments do not specify the percentage or number of votes that each Proxy may exercise, each Proxy may exercise half of your votes; and

• (b) Return both forms in the same envelope.

Lodgement of Proxy

This proxy form (and any power of attorney under which it is signed) must be received no later than 11.00am on 2 March 2009 being 48 hours before the time for holding the meeting. Any proxy form received after that time will not be valid for the scheduled meeting. Please lodge the proxy form with the Company’s Share Registry, you are encouraged to submit your proxy by mail or fax 08 9315 2233. The addresses of Security Transfer Registrars are as follows:

By mail: Security Transfer Registrars Pty Ltd PO Box 535 Applecross WA 6953 By hand: Suite 1, 770 Canning Highway Applecross WA 6153 By Fax: + 61 8 9315 2233 By email: registrar@securitytransfer.com.au