FINBAR GROUP LIMITED — Proxy Solicitation & Information Statement 2006

May 15, 2006

FINBAR INTERNATIONAL LIMITED

(ACN 009 113 473)

NOTICE OF GENERAL MEETING EXPLANATORY MEMORANDUM AND PROXY FORM

.......................................

Date of Meeting Friday 16 June 2006

Time of Meeting 10.00 a.m.

Place of Meeting "Reflections" Ground Floor, Finbar Building 15 Labouchere Road South Perth Western Australia

Finbar International Limited (ACN 009 113 473)

NOTICE OF GENERAL MEETING

NOTICE IS HEREBY GIVEN that a General Meeting of the shareholders of Finbar International Limited ("Company") will be held at "Reflections", Ground Floor, Finbar Building, 15 Labouchere Road, South Perth, Western Australia on Friday 16 June 2006 at 10.00 a.m. for the purpose of transacting the following business referred to in this Notice of General Meeting.

An Explanatory Memorandum containing information in relation to each of the following Resolutions accompanies this Notice of General Meeting.

Please note terms used in the Resolutions contained in this Notice of General Meeting have the same meaning as set out in the glossary of the Explanatory Memorandum accompanying this Notice.

AGENDA

BUSINESS

Resolution 1 - Approval to issue invitations for Options to the Managing Director - Mr John Chan

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

"That pursuant to the Executive Option Plan the Directors are authorised to issue invitations for 1,950,000 Options to be entered into by Mr John Chan (or his nominee or nominees) on the terms and conditions set out in Annexure A to the Explanatory Memorandum accompanying this Notice of General Meeting."

The Company will, in accordance with section 224 of the Corporations Act 2001, disregard any votes cast on Resolution 1 by Mr John Chan and any associate of Mr John Chan. However, the Company need not disregard a vote if it is cast by a person as a proxy appointed in writing that specifies how the proxy is to vote on the proposed resolution and it is not cast on behalf of Mr John Chan or an associate of Mr John Chan.

Resolution 2 - Approval to issue invitations for Options to the Executive Director - Mr Richard Rimington

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

"That pursuant to the Executive Option Plan the Directors are authorised to issue invitations for 1,400,000 Options to be entered into by Mr Richard Rimington (or his nominee or nominees) on the terms and conditions set out in Annexure A to the Explanatory Memorandum accompanying this Notice of General Meeting."

The Company will, in accordance with section 224 of the Corporations Act 2001, disregard any votes cast on Resolution 2 by Mr Richard Rimington and any associate of Mr Richard Rimington. However, the Company need not disregard a vote if it is cast by a person as a proxy appointed in writing that specifies how the proxy is to vote on the proposed resolution and it is not cast on behalf of Mr Richard Rimington or an associate of Mr Richard Rimington.

Resolution 3 - Approval to issue invitations for Options to the Chairman - Mr Paul Rengel

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

"That pursuant to the Executive Option Plan the Directors are authorised to issue invitations for 500,000 Options to be entered into by Mr Paul Rengel (or his nominee or nominees) on the terms and conditions set out in Annexure A to the Explanatory Memorandum accompanying this Notice of General Meeting."

The Company will, in accordance with section 224 of the Corporations Act 2001, disregard any votes cast on Resolution 2 by Mr Paul Rengel and any associate of Mr Paul Rengel. However, the Company need not disregard a vote if it is cast by a person as a proxy appointed in writing that specifies how the proxy is to vote on the proposed resolution and it is not cast on behalf of Mr Paul Rengel or an associate of Mr Paul Rengel.

Resolution 4 - Approval to issue invitations for Options to the Company Secretary - Mr Darren Pateman

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

"That pursuant to the Executive Option Plan the Directors are authorised to issue invitations for 1,000,000 Options to be entered into by Mr Darren Pateman (or his nominee or nominees) on the terms and conditions set out in Annexure A to the Explanatory Memorandum accompanying this Notice of General Meeting."

The Company will, in accordance with section 224 of the Corporations Act 2001, disregard any votes cast on Resolution 2 by Mr Darren Pateman and any associate of Mr Darren Pateman. However, the Company need not disregard a vote if it is cast by a person as a proxy appointed in writing that specifies how the proxy is to vote on the proposed resolution and it is not cast on behalf of Mr Darren Pateman or an associate of Mr Darren Pateman.

Resolution 5 - Approval to issue invitations for Options to the Executive Accountant - Mr Edward Bank

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

"That pursuant to the Executive Option Plan the Directors are authorised to issue invitations for 250,000 Options to be entered into by Mr Edward Bank (or his nominee or nominees) on the terms and conditions set out in Annexure A to the Explanatory Memorandum accompanying this Notice of General Meeting."

The Company will, in accordance with section 224 of the Corporations Act 2001, disregard any votes cast on Resolution 2 by Mr Edward Bank and any associate of Mr Edward Bank. However, the Company need not disregard a vote if it is cast by a person as a proxy appointed in writing that specifies how the proxy is to vote on the proposed resolution and it is not cast on behalf of Mr Edward Bank or an associate of Mr Edward Bank.

By order of the Board

Darren Pateman Company Secretary

Dated this 16 day of May 2006.

LC:31585F:ii-01

PROXIES

• Votes at the General Meeting may be given personally or by proxy, attorney or representative. ٠
• A shareholder entitled to attend and vote at the above meeting may appoint not more than two proxies to attend and vote at this meeting. Where more than one proxy is appointed, each proxy must be appointed to represent a specified proportion of the shareholder's voting rights. If such appointment is not made then each proxy may exercise half of the shareholder's voting rights. Fractions shall be disregarded.
• A proxy may, but need not be a shareholder of the Company.
• The instrument appointing the proxy must be in writing, executed by the appointor or his attorney duly authorising in writing or, is such appointor is a corporation, either under seal or under hand of the officer of his attorney duly authorised.
• The instrument of proxy (and the power of attorney or other authority, if any, under which it is signed) must be lodged by person, post, courier or facsimile and must reach the Registered Office of the Company at lease 48 hours prior to the General Meeting. For the convenience of shareholders a Proxy Form is enclosed.

For the purposes of regulation 7.11.37 of the Corporations Regulations, the Company determines that members holding ordinary shares at 5.00 p.m. Western Standard Time on Friday 9 June 2006 will be entitled to attend and vote at the General Meeting.

Finbar International Limited (ACN 009 113 473)

EXPLANATORY MEMORANDUM

This Explanatory Memorandum is intended to provide shareholders with sufficient information to assess the merits of the Resolution contained in the accompanying Notice of General Meeting ("Notice") of the Company.

The Directors of the Company ("Directors") recommend shareholders read this Explanatory Memorandum in full before making any decision in relation to the resolutions.

Capitalised terms used in the Explanatory Memorandum are defined in the Glossary appearing at the end of this Explanatory Memorandum.

The following information should be noted in respect of the various matters contained in the accompanying Notice:

RESOLUTIONS 1 TO 5 - APPROVAL TO GRANT OPTION TO EXECUTIVES

The Company proposes to authorise the Directors to invite the following executives of the Company. namely, Messrs John Chan, Richard Rimington, Paul Rengel, Darren Pateman and Edward Bank ("executives") to enter into a total of 5,100,000 Options. The Options have an exercise price of \$0.40 and have an expiry date of 36 months from issue.

On the 7 February 2006 the Board resolved to seek approval for invitations to the made to the executives for taking up a total of 5,100,000 Options at an issue price of \$0.40. At that time the shares of the Company were trading at \$0.43.

The invitation to enter into the Options is designed to encourage the executives to have a greater involvement in the achievement of the Company's objectives and to provide an incentive to strive to that end by participating in the future growth and prosperity of the Company through share ownership. Under the Company's current circumstances the Directors consider that the incentives to the executives represented by the issue of these Options, are a cost effective reward and incentive for the Company, as opposed to alternative forms of incentive, such as the payment of additional cash compensation.

The terms of the Options are set out in Annexure A to this Explanatory Memorandum.

The number of Options to be granted to each of the executives, Messrs John Chan, Richard Rimington, Paul Rengel, Darren Pateman and Edward Bank, has been determined based upon a consideration of:

• the remuneration of the executives the Directors wish to ensure that the remuneration of executives offered is competitive with market standards and, where appropriate, based upon performance hurdles. The Directors have considered the proposed number of Options to be issued and will ensure that the executives' overall remuneration is in line with market standards;
• length of service to the Company; and

$-4 -$

incentives to ensure continuity of service of the executives who have extensive knowledge of the ٠ Company and its assets.

In the event the Options are exercised, the following amounts will need to be paid to the Company by the executives, Messrs John Chan, Richard Rimington, Paul Rengel, Darren Pateman and Edward Bank.

Executive	Amount to be paid
John Chan	\$780,000.00
Richard Rimington	\$560,000.00
Paul Rengel	\$200,000.00
Darren Pateman	\$400,000.00
Edward Bank	\$100,000.00

The Company will, therefore, receive \$2,040,000.00 from the executives Messrs John Chan, Richard Rimington, Paul Rengel, Darren Pateman and Edward Bank, should all the Options be exercised.

Related Party Transactions Generally

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

• $1₁$ the giving of the financial benefits falls within one of the nominated exceptions to the provision; or
• $\overline{2}$ . shareholder approval is obtained prior to the giving of the financial benefit and the benefit is given within 15 months after obtaining such approval.

For the purposes of Chapter 2E, each of the executives are considered to be related parties of the Company.

Resolutions 1 to 5 provide for the grant of Options to the executives of the Company which is a financial benefit which requires shareholder approval.

Current Holdings

Set out below are details of each of the executives' relevant interests in the securities of the Company as at the date of this Notice:

Executive	Executive's Interest	Individual Interest
John Chan	2,238,403 shares	13,604,462 shares
Richard Rimington	1,325,285 shares	3,088,606 shares
Paul Rengel	600,000 shares	$23,000$ shares
Darren Pateman	700,000 shares	138,500 shares
Edward Bank	Nil	Nii

Previous Approvals under Executive Option Plan

Set out below are details of options previously approved by Shareholders pursuant to the Executive Option Plan in respect of the executives.

Executive	Options for shares exercisable by 4 September 2006
John Chan	1,286,828
Richard Rimington	1,008,000
Paul Rengel	600,000
Darren Pateman	700,000
Edward Bank	Nil

INFORMATION REQUIREMENTS

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

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

Subject to shareholder approval the Directors will be authorised to issue invitations for the following number of Options to be entered into by the following related parties or their respective nominees:

Executive	Amount to be paid
John Chan	1,950,000
Richard Rimington	1,400,000
Paul Rengel	500,000
Darren Pateman	1,000,000
Edward Bank	250,000

The nature of the financial benefit

The proposed financial benefit to be given is the invitation to enter into Options for no consideration to the executives of the Company as noted above. The terms and conditions of the Options to be granted to the executives are set out in the Explanatory Memorandum accompanying this Notice of General Meeting.

Executives' recommendation

For the reasons noted above:

Mr John Chan (who has no interest in the outcome of Resolutions 2, 3, 4 and 5) recommends that shareholders vote in favour of Resolution 2, 3, 4 and 5. Mr John Chan declines to make a recommendation

about Resolution 1 as he has a material personal interest in the outcome of that particular Resolution as it relates to the proposed issue of Options to him individually.

Mr Richard Rimington (who has no interest in the outcome of Resolution 1, 3, 4 and 5) recommends that shareholders vote in favour of Resolution 1, 3, 4 and 5. Mr Richard Rimington declines to make a recommendation about Resolution 2 as he has a material personal interest in the outcome of that particular Resolution as it related to the proposed issue of Options to him individually.

Mr Paul Rengel (who has no interest in the outcome of Resolution 1, 2, 4 and 5) recommends that shareholders vote in favour of Resolution 1, 2, 4 and 5. Mr Paul Rengel declines to make a recommendation about Resolution 3 as he has a material personal interest in the outcome of that particular Resolution as it related to the proposed issue of Options to him individually.

All the Directors were available to make a recommendation.

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

The proposed ordinary Resolutions 1 to 5 would have the effect of giving power to the Directors to issue invitations to executives to enter into a total of 5,100,000 Options on the terms and conditions as set out in Annexure A to this Explanatory Memorandum and as otherwise mentioned above.

If all Options for which invitations are issued were applied for as proposed above and exercised together with the existing unlisted options on issue, the effect would be to dilute the share holding of existing shareholders by 5%. The market price of the Company's Shares during the period of the Options will normally determine whether or not option holders exercise the Options. At the time any Options are exercised and Shares are issued pursuant to the exercise of the Options, the Company's Shares may be trading at a price which is higher than the exercise price of the Options.

The Company's Shares are quoted on ASX and as such have a market value.

Other Information

The Directors do not consider that from an economic and commercial point of view, there are any costs of detriments including opportunity costs or taxation consequences for the Company or benefits foregone by the Company in granting the Options pursuant to Resolutions 1 to 5.

Neither the Directors nor the Company are aware of other information that would reasonably be required by shareholders to make a decision in relation to the financial benefits contemplated by the proposed Resolutions.

GLOSSARY

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

"ASIC" means the Australian Securities and Investments Commission;

"ASX" means the Australian Stock Exchange Limited;

"Board" means the board of Directors;

"Company" means Finbar International Limited;

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

"Director" means a director of the Company;

"Executive Option Plan" means the Executive Option Plan 2003 Rules of the Company;

"Listing Rules" means the Listing Rules of the ASX;

"Notice" means the Notice of Meeting accompanying this Explanatory Memorandum;

"Option" means an option to acquire a Share, the terms and conditions of which are set out in Annexure A to the Explanatory Memorandum accompanying this Notice of General Meeting;

"Prospectus" means a prospectus proposed to be issued by the Company for the purpose of raising capital and seeking application to list on ASX;

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

"WST" means Australian Western Standard Time.

ANNEXURE A

TERMS AND CONDITIONS OF OPTIONS

The terms and conditions of the Options are as follows:

• $(a)$ The Options shall expire 36 months after issue ("Expiry Date").
• $(b)$ Each Option shall confer the right to subscribe for one fully paid ordinary share, ranking pari passu with existing fully paid ordinary shares, in the capital of the Company.
• The Options shall be exercisable by notice in writing to the Company received at any time after the $(c)$ first anniversary of the issue date and on or before the Expiry Date, however, the fully paid ordinary shares will be allotted not more than fifteen days after (but not including) the exercise date.
• $(d)$ The Options may be exercised in whole or in part. If the Options are exercised in part each notice of exercise must be for not less than 1,000 shares and in multiples of 1,000 shares.
• $(e)$ The exercise price for each Option shall be \$0.40.
• $(f)$ The Options may not be transferred within the first 12 months in whole or part.
• A certificate will be issued for the Options. On the reverse side of the certificate there will be $(g)$ endorsed a statement of the rights of the option holder and a notice that is to be completed when exercising the Options. If there is no more than one Option comprised in this certificate and prior to the Expiry Date those Options are exercised in part, the Company will issue another certificate for the balance of the Options held and not yet exercised.
• $(h)$ The option holder will not be permitted to participate in any new pro rata entitlement issues of securities of the Company.
• $(i)$ In the event of a reorganisation of the issued capital of the Company, the Options will be reorganised in accordance with the Listing Rules.
• $\left(\mathbf{i}\right)$ The Options will not give any right to participate in dividends until shares are allotted pursuant to the exercise of the relevant Options.
• There is no right to change the exercise price of the Options nor the number of underlying shares $(k)$ over which the Options can be exercised, if the Company completes a bonus or entitlements issue.
• $\left(\mathbf{l}\right)$ The Options are otherwise subject to the terms of the Executive Option Plan.

Finbar International Limited (ACN 009 113 473) PROXY FORM

I/We (name):
of (address):
	____

being a member of Finbar International Limited entitled to attend and vote at the General Meeting, hereby Appoint:

Name of Proxy

or, failing that person so named, then the Chairman of the General Meeting as my/our proxy to vote for me/us and on my/our behalf at the General Meeting of the Company to be held at "Reflections", Ground Floor, Finbar Building, 15 Labouchere Road, South Perth, Western Australia on Friday 16 June 2006 at 10.00 a.m. WST and at any adjournment of the meeting.

If the Chair of the meeting is appointed as your proxy, or may be appointed by default and you do not wish to direct your proxy how to vote as your proxy in respect of a resolution, please place a mark in the box. $\Box$

By marking this box, you acknowledge that the Chair of the meeting may exercise your proxy even if he has an interest in the outcome of the resolution/s and that votes cast by the Chair of the meeting for those resolutions other than as proxy holder will be disregarded because of that interest.

If you do not mark this box, and you have not directed your proxy how to vote, the Chair will not cast your votes on the resolution and your votes will not be counted in calculating the required majority if a poll is called on the resolution.

Should you so desire to direct the Proxy how to vote, you should place a cross in the appropriate box(s) below: I/We direct my/our Proxy to vote in the following manner: maa 100 Annipet Abetain

		ги	жүнигы	ADSCHI
Resolution 1:	Approval to issue invitations to enter into Options to a Director - Mr John Chan	O	П
Resolution 2:	Approval to issue invitations to enter into Options to a Director - Mr Richard Rimington	л	П
Resolution 3:	Approval to issue invitation to enter into Options to a Director - Mr Paul Rengel	П	П
Resolution 4:	Approval to issue invitation to enter into Options to the Company Secretary - Mr Darren Pateman	П	O
Resolution 5:	Approval to issue invitation to enter into Options to the Executive Accountant - Mr Edward Bank	П	U

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

The Chair proposes to vote for all of the resolutions other than any resolution in respect of which the Chair has a personal interest.

% of my voting right, or if 2 proxies are appointed Proxy 1 represents This Proxy is appointed to represent % and Proxy 2 represents % of my total votes. My total voting right is shares.

2006 by: ____ Signed this day of

INSTRUCTIONS FOR APPOINTMENT OF PROXY

• $\ddagger$ . A shareholder entitled to attend and vote is entitled to appoint no more than two proxies to attend and vote at this General Meeting as the shareholder's proxy. A proxy need not be a shareholder of the Company.
• $\overline{2}$ . Where more than one proxy is appointed, each proxy may be appointed to represent a specific proportion of the shareholder's voting rights. If such appointment is not made then each proxy may exercise half of the shareholder's voting rights. Fractions shall be disregarded.
• 1. The proxy form must be signed personally by the shareholder or his attorney, duly authorised in writing. If a proxy is given by a corporation, the proxy must be executed under either the common seal of the corporation or under the hand of an officer of the company or its duly authorised attorney. In the case of joint shareholders, this proxy must be signed by at least one of the joint shareholders, personally or by a duly authorised attorney.
• $\mathbf{4}$ If a proxy is executed by an attorney of a shareholder, then the original of the relevant power of attorney or a certified copy of the relevant power of attorney, if it has not already been noted by the company, must accompany the proxy form.
• 1. To be effective, forms to appoint proxies must be received by the Company no later than 48 hours before the time appointed for the holding of this General Meeting (that is, by 5.00 p.m. WST on Tuesday 13 June 2006) by post or facsimile to respective addresses stipulated below.
• 1. If the proxy form specifies a way in which the proxy is to vote on any of the resolutions states above, then the following applies:
• the proxy need not vote on a show of hands, but if the proxy does so, the proxy must vote that way; $(a)$ and
• $(b)$ if the proxy has 2 or more appointments that specify different ways to vote on the resolution, the proxy must not vote on a show of hands; and
• $(c)$ if the proxy is Chairperson, the proxy must vote on a poll and must vote that way; and
• $(d)$ if the proxy is not the Chairperson, the proxy need not vote on a poll, but if the proxy does so, the proxy must vote that way.

If a proxy is also a shareholder, the proxy can cast any votes the proxy holds as a shareholder in any way that the proxy sees fit.

• $\overline{7}$ . The Chairman intends to vote in favour of all resolutions set out in the Notice other than resolution 4 of which he has a material personal interest.
• 1. To vote by proxy, please complete and sign the proxy form enclosed and either:
• send the proxy form by post to Finbar International Limited, PO Box 113, South Perth, Western $(a)$ Australia, 6951; or
• send the proxy form by facsimile to the Company on facsimile number: + 61 8 9474 4458. $(b)$

so that it is received not later than 5.00 p.m. WST on Tuesday 13 June 2006.

Proxy forms received later than this time will be invalid.