GR ENGINEERING SERVICES LIMITED — Regulatory Filings 2016

Jul 14, 2016

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15 July 2016

Ms Anjuli Sinniah Adviser, Listings Compliance (Perth) ASX Compliance Pty Limited Level 40, Central Park 152-158 St George’s Terrace PERTH WA 6000

By email: anjuli.sinniah@asx.com.au tradinghaltsperth@asx.com.au

Response to ASX Aware Query

We refer to your query letter dated 14 July 2016 and respond as follows:

• 1) Yes

• 2) N/A

• 3) GR Engineering Services Limited ( Company ) first became aware of the Engineering Contract Information disclosed in the Announcement following the close of the trade on ASX on Friday, 8 July 2016.

• 4) The Company did not make any announcement prior to 11 July 2016 for the following reasons:

• a) the agreement the subject of the Engineering Contract Information ( Agreement ) was executed following the close of trade on ASX on Friday, 8 July 2016;

• b) at all material times up to the execution of the Agreement, the Engineering Contract Information was the subject of continuous negotiation and drafting between the parties’ respective management teams and legal counsel. These negotiations extended to key commercial terms of the Agreement;

• c) for the reasons set out in item 4(b) above, prior to the execution of the Agreement the Engineering Contract Information:

  • i) remained the subject of an incomplete proposal or negotiation; and

  • ii) was insufficiently definite to warrant disclosure;

• d) the Engineering Contract Information was the subject of confidential commercial discussions, occurring in the context of a competitive tender process that the Company was participating in; and

GR ENGINEERING SERVICES LIMITED ABN 12 121 542 738 Tel: +61 8 6272 6000 Fax: +61 8 6272 6001 Email: gres@gres.com.au Website: www.gres.com.au PO Box 258, Belmont WA 6984 179 Great Eastern Highway, Belmont WA 6104

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• e) for the reasons set out above, there could be no reasonable expectation that the information be disclosed.

Upon the execution of the Agreement, the situations referred to in items 4(c) – 4(e) ceased to exist, giving rise to the Company’s disclosure obligation. The Announcement was released to the ASX Market Announcement Platform at 7:29 (AWST) on Monday, 11 July 2016, prior to trading resuming following the Company’s entry into the Agreement and in compliance with the Company’s obligations under Listing Rule 3.1.

• 5) The Company confirms that it is in compliance with the Listing Rules and, in particular, Listing Rule 3.1.

Your sincerely

Joe Totaro Chief Financial Officer & Company Secretary

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14 July 2016

Mr J Totaro Company Secretary GR Engineering Services Limited 179 Great Eastern Highway BELMONT WA 6104

By email: joe.totaro@gres.com.au

Dear Mr Totaro

GR Engineering Services Limited (“GNG”): ASX aware query

ASX Limited (“ASX”) refers to the following:

1. GNG’s response to a price and volume query from ASX on 6 July 2016 regarding an increase in the price and volume of GNG’s securities, lodged on the ASX Market Announcements Platform and released at 1:36pm (AEST) on 6 July 2016 (“Price and Volume Query”).

2. In response to ASX’s question whether GNG was aware of any information concerning it that has not been announced to the market which, if known by some in the market, could explain the recent trading in its securities, GNG responded as follows:

“ No, the Company is not aware of any information that would be required to be announced under the ASX Listing Rules that has not previously been announced.”

1. GNG’s announcement entitled “Entry into $36 million EPC Contract” (“Contract”) lodged with the ASX Market Announcements Platform and released at 9.29 am (AEST) on Monday, 11 July 2016 (“Announcement”) disclosing GNG entered into an engineering, procurement and construction contract with Auctus Resources Pty Ltd, for the design and construction of completion works associated with the 500,000 tonne per annum Mungaga zinc, lead, copper and gold concentrator facility located at Chillagoe, North Queensland (“Engineering Contract Information”).

2. The movement in GNG’s share price between 4 July 2016 and 11 July 2016, where the share price increased from an intra-day low of $1.00 on 4 July 2016 to a closing price of $1.125 on 6 July 2016. Subsequent to the release of the Announcement, GNG’s share price increased from a closing price on $1.12 on 8 July 2016 to an intra-day high of $1.465 on 13 July 2016.

3. Listing Rule 3.1, which requires a listed entity to give ASX immediately any information concerning it that a reasonable person would expect to have a material effect on the price or value of the entity’s securities.

Level 40, Central Park 152-158 St George's Terrace Perth WA 6000

www.asx.com.au T 61 8 9224 0000 Customer service 13 12 79

ASX Compliance Pty Limited ABN 26 087 780 489

1. The definition of “aware” in Chapter 19 of the Listing Rules. This definition states that:

2. “ an entity becomes aware of information if, and as soon as, an officer of the entity (or, in the case of a trust, an officer of the responsible entity) has, or ought reasonably to have, come into possession of the information in the course of the performance of their duties as an officer of that entity.”

Additionally, you should refer to section 4.4 in Guidance Note 8 Continuous Disclosure: Listing Rules

3.1 – 3.1B “When does an entity become aware of information” .

1. Listing Rule 3.1A, which sets out exceptions from the requirement to make immediate disclosure, provided that each of the following are satisfied.

2. “3.1A Listing rule 3.1 does not apply to particular information while each of the following requirements is satisfied in relation to the information:

   • 3.1A.1 One or more of the following applies:

     • It would be a breach of a law to disclose the information;

     • The information concerns an incomplete proposal or negotiation;

     • The information comprises matters of supposition or is insufficiently definite to warrant disclosure;

     • The information is generated for the internal management purposes of the entity; or

     • The information is a trade secret; and

   • 3.1A.2 The information is confidential and ASX has not formed the view that the information has ceased to be confidential; and

   • 3.1A.3 A reasonable person would not expect the information to be disclosed.”

3. ASX’s policy position on the concept of “confidentiality” which is detailed in section 5.8 of Guidance Note 8 Continuous Disclosure: Listing Rules 3.1 – 3.1B “Listing Rule 3.1A.2 – the requirement for information to be confidential” . In particular, the Guidance Note states that:

“Whether information has the quality of being confidential is a question of fact, not one of the intention or desire of the listed entity. Accordingly, even though an entity may consider information to be confidential and its disclosure to be a breach of confidence, if it is in fact disclosed by those who know it, then it ceases to be confidential information for the purposes of this rule.”

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Having regard to the above, we ask that you answer the following questions in a format suitable for release to the market in accordance with Listing Rule 18.7A:

1. Does GNG consider the Engineering Contract Information disclosed in the Announcement, to be information that a reasonable person would expect to have a material effect on the price or value of its securities?

2. If the answer to question 1 is “no”, please advise the basis for that view.

3. If the answer to question 1 is “yes”, when did GNG first become aware of the Engineering Contract Information disclosed in the Announcement?

4. If the answer to question 1 is “yes” and GNG first became aware of the Engineering Contract Information prior to 11 July 2016, did GNG make any announcement prior to 11 July 2016 which disclosed the Engineering Contract Information? If so, please provide details. If not, please explain why the Engineering Contract Information was not released to the market at an earlier time, commenting specifically on when you believe GNG was obliged to release the Engineering Contract Information under Listing Rules 3.1 and 3.1A, and what steps GNG took to ensure that the Engineering Contract Information, was released promptly and without delay.

5. Please confirm that GNG is in compliance with the Listing Rules and, in particular, Listing Rule 3.1.

When and where to send your response

This request is made under, and in accordance with, Listing Rule 18.7. Your response is required as soon as reasonably possible and, in any event, by not later than 4.00pm WST on Monday 18 July 2016 . If we do not have your response by then, ASX will have no choice but to consider suspending trading in the Entity’s securities under Listing Rule 17.3.

You should note that if the information requested by this letter is information required to be given to ASX under Listing Rule 3.1 and it does not fall within the exceptions mentioned in Listing Rule 3.1A, the Entity’s obligation is to disclose the information “immediately”. This may require the information to be disclosed before the deadline set out in the previous paragraph.

ASX reserves the right to release a copy of this letter and your response on the ASX Market Announcements Platform under Listing Rule 18.7A. Accordingly, your response should be in a form suitable for release to the market.

Your response should be sent by e-mail to tradinghaltsperth@asx.com.au. It should not be sent directly to the ASX Market Announcements Office. This is to allow me to review your response to confirm that it is in a form appropriate for release to the market, before it is published on the ASX Market Announcements Platform.

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Listing Rule 3.1

Listing Rule 3.1 requires a listed entity to give ASX immediately any information concerning it that a reasonable person would expect to have a material effect on the price or value of the entity’s securities. Exceptions to this requirement are set out in Listing Rule 3.1A.

The obligation of the Entity to disclose information under Listing Rules 3.1 and 3.1A is not confined to, nor is it necessarily satisfied by, answering the questions set out in this letter.

In responding to this letter, you should have regard to the Entity’s obligations under Listing Rules 3.1 and 3.1A and also to Guidance Note 8 Continuous Disclosure: Listing Rules 3.1 – 3.1B.

Trading halt

If you are unable to respond to this letter by the time specified above, you should discuss with us whether it is appropriate to request a trading halt in the Entity’s securities under Listing Rule 17.1.

If you wish a trading halt, you must tell us:

• the reasons for the trading halt;

• how long you want the trading halt to last;

• the event you expect to happen that will end the trading halt;

• that you are not aware of any reason why the trading halt should not be granted; and

• any other information necessary to inform the market about the trading halt, or that we ask for.

We may require the request for a trading halt to be in writing. The trading halt cannot extend past the commencement of normal trading on the second day after the day on which it is granted.

You can find further information about trading halts in Guidance Note 16 Trading Halts & Voluntary Suspensions.

If you have any queries or concerns about any of the above, please contact me immediately.

Yours sincerely

[Sent electronically without signature]

Anjuli Sinniah Adviser, Listings Compliance (Perth)

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