GREENWING RESOURCES LTD — Capital/Financing Update 2009

Dec 3, 2009

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ABN 31 109 933 995
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Offer Document

Rights Issue

Offer Document for a non-renounceable pro rata Offer of 2 New Shares for every 9 existing Shares at an issue price of 23 cents per New Share to raise approximately $5.3 million.

Applications under the Rights Issue must be lodged by 5.00 pm WST on 18 December 2009. Please note payment made by BPAY® must be received by 3.00 pm WST on 18 December 2009.

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This document is not a prospectus.

It does not contain all of the information that an investor would find in a prospectus or which may be required in order to make an informed investment decision regarding, or about the rights attaching to, the New Shares offered by this document.

This document is important and requires your immediate attention . It should be read in its entirety. If you do not understand its content or are in doubt as to the course you should follow, you should consult your stockbroker or professional adviser without delay.

This Offer is scheduled to close at 5.00 pm WST on 18 December 2009. Please note that payment made by BPAY® must be received no later than 3.00 pm WST on 18 December 2009.

Valid acceptances must be received before that time, unless the Offer is extended.

Please read the instructions in this document and on the accompanying Entitlement and Acceptance Form regarding the acceptance of your entitlement.

TABLE OF CONTENTS

	IMPORTANT INFORMATION	2
	CHAIRMAN’S LETTER	3
1.	DETAILS OF THE OFFER	4
2.	ACTION REQUIRED BY SHAREHOLDERS	8
3.	RISK FACTORS	10
4.	DEFINED TERMS	14
	CORPORATE DIRECTORY	15

Bass Metals Ltd

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Important Information

No person is authorised to give any information or to make any representation in connection with the Offer which is not contained in this Offer Document. Any information or representation not so contained may not be relied on as having been authorised by the Company in connection with the Offer.

This document is not a prospectus and does not contain all of the information that an investor would find in a prospectus or which may be required to make an informed investment decision regarding, or about the rights attaching to, the New Shares offered by this Offer Document.

This Offer Document is dated 4 December 2009.

Eligibility

Applications for New Shares by Eligible Shareholders can only be made on an original Entitlement and Acceptance Form, as sent with this Offer Document. The Entitlement and Acceptance Form sets out an Eligible Shareholder's entitlement to participate in the Offer.

Overseas shareholders

No action has been taken to permit the offer of New Shares under this Offer Document in any jurisdiction other than Australia and New Zealand. The distribution of this Offer Document in jurisdictions outside Australia and New Zealand may be restricted by law and therefore persons into whose possession this document comes should seek advice on and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of applicable securities laws.

This Offer Document does not constitute an offer of New Shares in any jurisdiction where, or to any person to whom, it would be unlawful to issue this Offer Document.

Privacy

The Company collects information about each Applicant provided on an Entitlement and Acceptance Form for the purposes of processing the Application and, if the Application is successful, to administer the Applicant’s security holding in the Company.

By submitting an Entitlement and Acceptance Form, each Applicant agrees that the Company may use the information provided by an Applicant on the Entitlement and Acceptance Form for the purposes set out in this privacy disclosure statement and may disclose it for those purposes to the share registry, the Company’s related bodies corporate, agents, contractors and third party service providers, including mailing houses and professional advisers, and to ASX and regulatory authorities.

If you do not provide the information required on the Entitlement and Acceptance Form, the Company may not be able to accept or process your Application. An Applicant has a right to gain access to the information that the Company holds about that person subject to certain exemptions under law. A fee may be charged for access. Access requests must be made in writing to the Company’s registered office.

Bass Metals Ltd

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Chairman’s Letter to Shareholders

4 December 2009

Dear Shareholder

Non-Renounceable Rights Issue

The Board of Bass Metals Ltd is pleased to offer you an opportunity to acquire additional Shares.

Details of the Rights Issue are set out in the accompanying materials and you should read these in their entirety before deciding whether to participate. Key points of the Rights Issue are as follows:

• Eligible Shareholders are able to acquire additional Shares via a non-renounceable Rights Issue on the basis of two (2) New Shares for every nine (9) Shares held at the Record Date of 2 December 2009.

• there are no transaction costs payable on the allotment of Shares under the Rights Issue.

• should you elect to participate in the Rights Issue, all New Shares will be issued at 23 cents each. This pricing represented a discount of approximately 20% from Bass Metals’ 5 day volume weighted average Share price immediately before announcement of the Offer.

• Shares allotted under the Rights Issue will rank equally with existing fully paid ordinary shares.

If you decide to take up your full entitlement under the Offer you will also be able to apply for Additional Shares at the same price, being 23 cents per New Share, from any Shortfall. The Directors also reserve the right to place any Shortfall to parties, other than related parties of the Company, within three months of the close of the Rights Issue.

The Rights Issue is not underwritten but the Company’s major shareholder, Metals Finance Limited, has indicated its intention to participate to the full extent of its entitlement (20.8%).

The Rights Issue will raise up to approximately $5.3 million before costs. The funds will be used as additional working capital primarily in relation to ongoing exploration, evaluation and development of the Company’s projects, particularly Fossey Zone, Que River and Hellyer.

The timetable for the Rights Issue is set out under Section 1.3 of the Offer Document.

To participate in the Rights Issue you must either:

• submit your payment using BPAY® before 3.00 pm WST on 18 December 2009; or

• complete and return your personalised Entitlement and Acceptance Form attaching either a cheque or bank draft and mail it in the reply paid envelope so that it is received by our share registry before 5.00 pm WST on 18 December 2009.

The Directors encourage you to consider the Offer carefully. If you are unsure about any aspects of the Offer you should consult your financial adviser.

Thank you for your continuing support as a shareholder of Bass Metals.

Yours faithfully

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Don Boyer Chairman

Bass Metals Ltd

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1. Details of the Offer

1.1. The Offer

The Company is making a non-renounceable pro rata offer of New Shares at an issue price of 23 cents each on the basis of two (2) New Shares for every nine (9) Shares held on the Record Date with any fractional entitlements rounded up.

As at the date of this Offer Document, the Company has 103,848,803 Shares on issue. The number of New Shares to be issued under the Offer, if fully subscribed, will be 23,077,512. The Company also has 4,176,939 quoted Options and 4,155,000 unquoted Options on issue which carry no entitlement to participate in the Offer unless exercised prior to the Record Date.

The Offer is not underwritten.

The Company has also included in the Offer a facility for Shareholders to apply for more Shares than their entitlement under any Shortfall (subject to availability) on the same terms as the Offer.

1.2. Use of Funds

The Offer will raise up to $5,307,828 before costs, if fully subscribed. The funds will be used as additional working capital primarily in relation to ongoing exploration, evaluation and development of the Company’s projects, particularly Fossey Zone, Que River and Hellyer. As the Rights Issue is not underwritten, the full amount may not be raised. However, as announced by the Company on 24 November 2009, the Rights Issue is part of an integrated fundraising strategy that includes a $10 million placement to institutional and professional investors in combination with a planned $10 to $15 million banking and/or concentrate pre-payment facility to generate sufficient cash for the Company to undertake its Fossey Mine development, accelerate testing of its new exploration targets in the Hellyer-Que River region and provide general working capital for the Company.

1.3. Timetable

1.3. Timetable
Rights Issue/Offer announced via ASX	24 November 2009
Shares trade ex-entitlements (Ex date)	26 November 2009
Record Date (date for determining entitlements of Eligible Shareholders to participate in	2 December 2009
the Offer)
Offer Document and Entitlement & Acceptance Form sent to Eligible Shareholders	4 December 2009
Acceptances close*	18 December 2009
New Shares quoted on a Deferred Settlement basis **	21 December 2009
Company to notify ASX of under-subscriptions (if any) **	23 December 2009
Allotment and issue of New Shares **	29 December 2009
Deferred Settlement trading ends **	29 December 2009
Trading commences on ASX **	30 December 2009
Dispatch of holding statements **	31 December 2009

Bass Metals Ltd

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• Subject to the Listing Rules, the Directors reserve the right to extend the Closing Date for the Offer at their discretion. Should this occur, the extension will have a consequential effect on the anticipated date of issue for the New Shares.

• ** These dates are indicative only.

1.4. Entitlement and Acceptance

The entitlement of Eligible Shareholders to participate in the Offer will be determined on the Record Date. Your entitlement is shown on the Entitlement and Acceptance Form accompanying this Offer Document. There is no obligation on Eligible Shareholders to participate in the Offer. Eligible Shareholders may accept their entitlement in full or in part or not at all. Eligible Shareholders who accept their full entitlement have the opportunity to apply for Additional Shares on the same terms under any Shortfall. Eligible Shareholders should refer to Section 2 and the Entitlement and Acceptance Form for further instructions.

1.5. Shortfall

Eligible Shareholders may, in addition to taking up all of their entitlement, apply for Additional Shares under any Shortfall. The allocation of these Additional Shares will be limited to any Shortfall and will be at the discretion of the Directors. The Company reserves the right to place any Shortfall, other than to related parties of the Company, at the discretion of the Directors. In accordance with the ASX Listing Rules, the Company must place any Shortfall within three (3) months of the Closing Date.

1.6. Closing Date

The Company will accept Applications until 5.00 pm WST on the Closing Date (18 December 2009) or such later date as the Directors in their absolute discretion shall determine, subject to the Listing Rules. Please note that payment made by BPAY® must be received no later than 3.00 pm WST on the Closing Date.

1.7. Withdrawal of Rights Issue

The Company reserves the right not to proceed with the Rights Issue at any time before the issue of the New Shares to Eligible Shareholders. If the Rights Issue does not proceed, the Company will return all application monies as soon as practicable after giving notice of its withdrawal, without interest.

1.8. Issue and Dispatch

The expected dates for issue of New Shares offered by this Offer Document and dispatch of holding statements is expected to occur on the dates specified in the timetable set out in Section 1.3. It is the responsibility of Applicants to determine the allocation prior to trading in the New Shares. Applicants who sell New Shares before they receive their holding statements will do so at their own risk.

1.9. ASX Listing

Application will be made to the ASX for the official quotation of the New Shares. If the ASX does not grant quotation to the New Shares, the Company will repay all application monies received pursuant to the Offer, without interest, as soon as practicable after the Closing Date.

Bass Metals Ltd

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1.10. CHESS

The Company participates in the Clearing House Electronic Subregister System (CHESS) operated through ASX. Under CHESS, Applicants will not receive a certificate but will receive a statement of their holding of New Shares.

If you are registered in the Issuer Sponsored subregister, your statement will be dispatched by the Company’s share registry and will contain the number of New Shares issued to you under this Offer Document and your security holder reference number.

A CHESS statement or Issuer Sponsored statement will routinely be sent to Shareholders at the end of any calendar month during which the balance of their holding changes. Shareholders may request a statement at any other time, however there may be a charge associated with the provision of this service.

1.11. Ineligible Shareholders

This Offer is not being extended (and accordingly, Entitlement and Acceptance Forms will not be sent) to Shareholders with registered addresses outside Australia and New Zealand. The Company has decided that it is unreasonable to make the Offer to Shareholders outside Australia and New Zealand having regard to:

• the small number of Shareholders with addresses outside these countries;

• the small number and value of the Shares they hold; and

• the cost of complying with the legal requirements and the requirements of the regulatory authorities in each of the countries concerned.

No action has been taken to register or qualify the Offer Document and Entitlement and Acceptance Form, the Rights Issue, or the New Shares or to otherwise permit a public offering of the New Shares in any jurisdiction outside of Australia and New Zealand. The Offer Document and accompanying Entitlement and Acceptance Form do not, nor are they intended to, constitute an offer in any place in which, or to any person to whom, it would not be lawful to make such an offer.

1.12. Taxation Implications

The Directors do not consider it appropriate to give Shareholders advice regarding the taxation consequences of subscribing for New Shares under this Offer Document. The Company, its officers and its advisers do not accept any responsibility or liability for any such taxation consequences to Shareholders. Shareholders should consult their professional tax adviser in connection with subscribing for New Shares under this Offer Document.

1.13. Risk Factors

An investment in New Shares should be regarded as speculative. In addition to the general risks applicable to all investments in quoted securities, there are specific risks associated with an investment in the Company which are described in Section 3.

1.14. Enquiries

Enquiries concerning the Entitlement and Acceptance Form can be directed to the Company’s share registry by telephone on 1300 557 010. Enquiries relating to this Offer Document should be directed to Mr Michael Rosenstreich, the Managing Director, by telephone on +61 8 9322 8044.

Bass Metals Ltd

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1.15. Company Structure

Set out below is the proforma capital structure of the Company assuming the Rights Issue is fully subscribed. It is noted that the Rights Issue is not underwritten. The Company’s major shareholder, Metals Finance Limited, has indicated its intention to participate to the full extent of its entitlement which represents 20.8% of the total issued Shares at the date of this Offer Document. Further, the Company reserves the right to place any Shortfall within 3 months of the Closing Date.

The issue of the New Shares pursuant to the Rights Issue is not expected to have any material effect or consequence on the control of Bass Metals.

In addition to the Rights Issue, the Company announced on 24 November 2009 a placement of Shares to institutional and professional investors to raise $10,000,000 (before costs). The placement of up to 43,478,261 Shares at 23 cents (the same price as the Rights Issue) will occur in two tranches:

• Tranche A comprising 15,207,320 Shares will be issued under the Company’s 15% capacity on or about 7 December 2009; and

• Tranche B comprising 28,270,941 Shares which is subject to Shareholder approval will be issued in late January 2010 following a General Meeting of Shareholders to be convened by the Company. A Notice of Meeting will be issued to Shareholders in due course.

As the placement will not occur until after the Record Date of the Rights Issue, the placement Shares will not participate in the Offer pursuant to this Offer Document.

Proforma Capital Structure assuming the Rights Issue is Fully Subscribed

Proforma Capital Structure assuming the Rights Issue is Fully Subscribed
Issued Shares	Number of Shares
Total issued Shares at the date of the Offer Document prior to the Rights Issue	103,848,803
Maximum number of New Shares issued under the Rights Issue (2:9 basis)	23,077,512
Tranche A of the placement	15,207,320
Maximum total issued Shares following completion of the Rights Issue	142,133,635
Tranche B of the placement (subject to Shareholder approval)	28,270,941
Maximum total issued Shares following the Rights Issue and placement	170,404,576

The Company also has the following Options on issue at the date of the Offer Document. The Options carry no right to participate in the Rights Issue unless exercised prior to the Record Date.

Issued Options	Number of Options
Quoted Options exercisable at 40 cents each and expiring 30 April 2010.	4,176,939
Unquoted Options exercisable at 27.5 cents and expiring 22 December 2011.	1,375,000
Unquoted Options exercisable at 37.5 cents and expiring 31 December 2011.	350,000
Unquoted Options exercisable at 51 cents and expiring 31 December 2012.	525,000
Unquoted Options exercisable at 37.5 cents and expiring 2 November 2011.	250,000
Unquoted Options exercisable at 42.5 cents and expiring 16 October 2012.	1,455,000
Unquoted Options exercisable at 25 cents and expiring 1 September 2013.	100,000
Unquoted Options exercisable at 35 cents and expiring 1 September 2013.	100,000
Total Issued Options	8,331,939

Bass Metals Ltd

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2. Action Re uired b Shareholders q y

2.1. To Accept Your Entitlement

Shareholders who wish to accept their entitlement under this Offer Document may pay by either BPAY®, cheque or bank draft. Each payment method is described in turn below.

Payment by BPAY®

If you wish to pay using BPAY®, there is no requirement for the Entitlement and Acceptance Form to be returned. You can simply make a payment for the number of New Shares (and any Additional Shares) you wish to apply for using the Bass Metals Biller Code and your personalised Reference Number which can be found on both sides of your Entitlement and Acceptance Form.

Instructions regarding making a payment by BPAY® are also set out on the Entitlement and Acceptance Form. Please note that payment made by BPAY® must be received no later than 3.00pm WST on the Closing Date.

Payment by cheque/bank draft

If you do not wish to pay using BPAY®, your completed Entitlement and Acceptance Form must be accompanied by a cheque or bank draft in Australian dollars for the application monies, crossed “Not Negotiable” and made payable to "Bass Metals Ltd" and lodged at any time after the Opening Date and on or before 5.00pm WST on the Closing Date at the Company’s share registry (by delivery or by post). A reply paid envelope is enclosed for Shareholders in Australia. New Zealand Shareholders will need to affix the appropriate postage.

By post: Computershare Investor Services Pty Ltd Locked Bag 2508 Perth WA 6001

By delivery: Computershare Investor Services Pty Ltd Level 2 45 St Georges Terrace PERTH WA 6000

2.2. To Apply for Additional Shares

Eligible Shareholders may, in addition to taking up all of their entitlement, apply for Additional Shares under any Shortfall.

Payment by BPAY®

If payment is made using BPAY®, as set out above, there is no requirement for the Entitlement and Acceptance Form to be returned. By paying for more New Shares than your entitlement, you will be making an Application for the excess shares as Additional Shares. If there is any discrepancy between the number of Additional Shares you apply for on the Entitlement and Acceptance Form and the number you pay for using BPAY®, the Company will assume you wish to apply for the number of Additional Shares to which your payment relates.

Bass Metals Ltd

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As set out above, you can simply make a payment for the number of New Shares you wish to apply for using the Bass Metals Biller Code and your personalised Reference Number which can be found on both sides of your Entitlement and Acceptance Form. Instructions regarding making a payment by BPAY® are also set out on the Entitlement and Acceptance Form.

Payment by cheque/bank draft

If you do not wish to pay using BPAY®, you can apply for Additional Shares as well as your entitlement by submitting one completed Entitlement and Acceptance Form to the Company’s share registry at the address above. You can apply for Additional Shares in the dedicated section for Additional Shares on the Entitlement and Acceptance Form.

Your cheque or bank draft, made payable to "Bass Metals Ltd", should be for the full amount of your Application being:

• The application monies payable in relation to your entitlement; and

• The amount payable in relation to any Additional Shares for which you have applied.

Allocation of Additional Shares

Eligible Shareholders are not assured their Application for Additional Shares will be met in full. The allocation of these Additional Shares will be limited to any Shortfall and will be at the discretion of the Directors. Further, the Directors reserve the right to place any Shortfall, other than to related parties of the Company, at the discretion of the Directors within three (3) months of the Closing Date. No Additional Shares will be issued which will result in an Eligible Shareholder increasing their percentage interest in Bass Metals Shares above 20%. There is no assurance that Eligible Shareholders will be allocated any Additional Shares and by applying for Additional Shares you are bound to accept a lesser number of Additional Shares as determined by the Company. Any excess application monies will be refunded without interest as soon as possible after the Closing Date.

2.3. To Accept Part of Your Entitlement

Complete the Entitlement and Acceptance Form by filling in the details in the spaces provided, including the number of New Shares you wish to accept and the application monies (calculated at 23 cents per New Share accepted), and attach a cheque for the appropriate application monies. Send the Entitlement and Acceptance Form and cheque to the share registry by the Closing Date per Section 2.1 above.

If payment is made using BPAY®, Shareholders must pay the appropriate application monies (calculated at 23 cents per New Share accepted) as set out in Section 2.1 above. There is no requirement for the Entitlement and Acceptance Form to be returned.

2.4. Entitlement Not Taken Up

If you do not wish to accept any of your entitlement you are not obliged to do anything. The number of Shares you currently hold and the rights attaching to those Shares will not be affected. However, your shareholding in the Company will be diluted with the subsequent issue of the New Shares. All entitlements not accepted will form part of the Shortfall which will be dealt with at the discretion of the Directors.

Bass Metals Ltd

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3. Risk Factors

The New Shares offered under this Offer Document are considered speculative. The Directors strongly recommend Eligible Shareholders examine the contents of this Offer Document and ASX releases and consult their professional advisers before deciding whether to apply for the New Shares pursuant to this Offer. Eligible Shareholders should be aware there are risks associated with investment in the Company, many of which are largely beyond the control of the Company and its Directors because of the nature of the business of the Company. The following summary, which is not exhaustive, represents some of the major risk factors which Eligible Shareholders need to be aware of:

3.1. General Risks

An investment in the Company involves general risks associated with any investment in shares of companies that are listed on a stock exchange. Many factors affect the financial performance of Bass Metals and/or the price of its Shares and Options. General risk factors include:

Investment Risk

The New Shares to be issued pursuant to this Offer Document should be considered speculative. They carry no guarantee as to payment of dividends, return of capital or market value. The prices at which the New Shares trade on ASX may be above or below the price paid for the New Shares. While the Directors commend the Rights Issue, Shareholders must make their own assessment of the likely risks and determine whether accepting their entitlements in the Company is appropriate to their own circumstances.

Share Market Risk

The Company will apply to ASX for quotation of the New Shares. Share market conditions may affect the quoted securities regardless of the operating performance of the Company. Many factors will affect the market price of the securities including local and international stock markets, movements in interest rates, commodity prices and currency fluctuations, economic outlook and investor sentiment generally. The market price of the New Shares may fall as well as rise.

Availability of Capital Risk

The ability of the Company to access debt and/or raise equity capital as and when required will be influenced by many factors and may not be available on commercially acceptable terms or may not be available at all.

Commodity Price and Exchange Rate Risk

As the Company’s earnings are largely derived from the sale of mineral commodities, either in processed or concentrate forms, the Company’s future revenues and cash flows will be impacted by changes in the prices of these commodities. Commodity prices fluctuate and are affected by numerous factors beyond the control of the Company. These factors include current and expected future supply and demand, forward selling by producers, production cost levels in major metal producing centres as well as macroeconomic conditions such as inflation and interest rates. Furthermore, the international prices of most commodities are denominated in United States dollars while the Company’s cost base will be in Australian dollars. Consequently changes in the Australian dollar exchange rate will impact on the earnings of the Company. The exchange rate is affected by numerous factors beyond the control of the Company, including interest rates, inflation and the general economic outlook.

Bass Metals Ltd

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Economic Factors and Government Risks

The future viability of the Company is also dependent on a number of factors affecting performance of all industries, including, but not limited to, the following:

• general economic conditions in Australia and its major trading partners;

• changes in Government policies, taxation and other laws;

• the strength of the equity markets in Australia and throughout the world, and in particular investor sentiment towards the commodities (resources) sector;

• movement in, or outlook on, interest rates and inflation rates; and

• natural disasters, social upheaval or war in Australia or overseas.

Acts of Terrorism and Outbreak of International Hostilities

An act of terrorism or an outbreak of international hostilities may occur, adversely affecting consumer confidence and share market performance. This may have an adverse impact on Bass Metals’ operating, financial and share price performance.

3.2. Exploration, Development, Mining and Processing Risks

Mineral exploration, project development and mining contain elements of significant risk. The future success of the Company, like all resource exploration and mining companies, will be heavily dependent upon a number of factors many of which are beyond the control of the Company. Such risk factors include:

• maintenance of tenure and access to the Company’s tenements and the granting of any mining tenement applications or other approvals required for the conduct of exploration and mining activities;

• reliance on key personnel, including the Directors, and ongoing access to competent management and technical personnel;

• the discovery and exploitation of economically recoverable ore reserves on the Company’s tenements or any other tenements that may be acquired in the future;

• the calculation and interpretation of resource estimates are by their nature expressions of judgement based on knowledge, experience and industry practice. Estimates which were valid when originally calculated may alter significantly through additional fieldwork or when new information or techniques become available. This may result in alterations to development and mining plans, which may, in turn adversely affect the Company’s operations;

• finalisation of bankable feasibility studies and access to adequate project development capital on acceptable terms;

• financial failure or default by a participant in any joint venture or other contractual relationship to which the Company is, or may become a party;

• the ability to negotiate acceptable treatment agreements with respect to various mining and milling alternatives;

• obtaining consents and approvals necessary for the conduct of exploration and mining;

• mechanical failure or breakdown of mining or drilling plant and equipment or mine structure resulting in significant delays;

• adverse weather conditions, accidents or industrial disputes over a prolonged period adversely affecting mining and exploration activities and the earning of revenues; and

• adverse changes in government policies or legislation affecting mining and exploration activities.

Bass Metals Ltd

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3.3. Native Title

The Native Title Act 1993 (Cth) recognises and protects the rights and interests in Australia of Aboriginal and Torres Strait Islander people in land and waters, according to their traditional laws and customs. The risks arising because of native title and aboriginal land rights may affect the Company’s ability to gain access to prospective exploration areas to obtain production titles. Compensatory obligations may be necessary in settling native title claims lodged over any of the tenements held or acquired by the Company. The level of impact of these matters will depend, in part, on the location and status of the tenements acquired by the Company.

3.4. Risks Specific to the Company

There are also a number of specific risks associated with the Company which may adversely affect the Company’s financial position, prospects and price of its quoted securities. In particular, the Company is subject to risks relating to the exploration and development of mineral properties which are not generally associated with other businesses.

Operational and Technical Risks

The current and future operations of the Company, including exploration, appraisal and possible production activities may be affected by a range of factors, including:

• geological conditions;

• limitations on activities due to seasonal weather patterns;

• alterations to joint venture programmes and budgets;

• the availability of drilling rigs and other machinery in Tasmania necessary for the Company to undertake its activities;

• unanticipated operational and technical difficulties encountered in survey, drilling and production activities;

• mechanical failure of operating plant and equipment, adverse weather conditions, industrial and environmental accidents, industrial disputes and other force majeure events;

• unexpected shortages or increases in the costs of consumables, spare parts, plant and equipment; and

• prevention or restriction of access by reason of political unrest, outbreak of hostilities, and inability to obtain consents or approvals (including clearance of work programs pursuant to existing, and any future access agreements entered into with future registered Aboriginal Land Council and Native Title claimants).

Title, Environmental Bonds & Conditions

All mining tenements which the Company may acquire either by application, sale and purchase or farm-in are regulated by applicable state mining legislation. There is no guarantee that applications will be granted as applied for. Various conditions may also be imposed as a condition of grant. In addition the relevant minister may need to consent to any transfer of a tenement to the Company.

The Company’s projects are subject to State and Federal laws and regulations regarding environmental matters. Many of the activities and operations of the Company cannot be carried out without prior approval from and compliance with all relevant authorities. Resource activities can be environmentally sensitive and can give rise to substantial costs for environmental rehabilitation, damage control and losses. The Company intends to conduct its activities in an environmentally responsible manner and in accordance with all applicable laws.

Bass Metals Ltd

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The Company has recently submitted a Development Proposal and Environmental Management Plan (DPEMP) to the Tasmanian Environmental Protection Authority (EPA) as part of the approval process for its Fossey Mine development. The application is in progress and whilst the Company considers that its DPEMP meets all of the requirements, failure to achieve an approval or further investigations by the EPA could halt or delay the proposed mine development.

The Tasmanian Department of Minerals and Resources (MRT) from time to time review the environmental bonds that are placed on tenements. The Company’s Hellyer Mine Lease is currently under review for a further extension of term. Bass Metals considers that an extension for a full 21 year term will be granted, however this is at the discretion of the MRT. The review of Bonds, including the review of the Hellyer Mine lease bond could result in a requirement to lodge additional funds potentially impacting the Company’s working capital position.

The Federal Government has committed to increasing Forest Reserves by 170,000 ha. The decision as to where those areas will be has yet to be determined and is under review by Forestry Tasmania. These reserves could impinge on the Company’s tenement areas though the Tasmanian Government has stated that in areas prospective for minerals those reserves will be dual use and accessible to exploration.

Resource Estimates

Resource estimates are expressions of judgement based on knowledge, experience and industry practice. Estimates which were valid when made, may change significantly when new information becomes available. In addition, resource estimates are imprecise and depend to some extent on interpretations, which may prove to be inaccurate. Should the Company encounter mineralisation or formations different from those predicted by past sampling and drilling, resource estimates may have to be adjusted and mining plans altered in a way which could impact adversely on the operations of the Company.

Mine Development

The Company is contemplating a new underground mine development to mine its Fossey Mineral Resource. A detailed feasibility study has recently been completed however estimates of costs, ground conditions, production rates, dewatering aspects and all of the typical technical parameters which were valid when made, may change significantly when new information becomes available as mine development commences. Should the Company encounter mining conditions or ore blocks different from those predicted in the feasibility study then mining plans may need to be altered in a way which could impact adversely on the operations of the Company.

Agreements with Third Parties

The Company is and will be subject to various contracts and agreements with third parties. There is a risk of financial failure or default by a counterparty to these arrangements. Any breach or failure may lead to penalties or termination of the relevant contract. In addition, the Company’s interest in the relevant subject matter may be jeopardised.

Bass Metals Ltd

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4. Defined Terms

"Additional Shares" means those New Shares that Eligible Shareholders will be able to purchase in addition to their full entitlement in the event of any Shortfall;

"Applicant" refers to a person who submits an Entitlement and Acceptance Form;

"Application" refers to the submission of an Entitlement and Acceptance Form;

"ASX" means ASX Limited (ACN 008 624 691) or, where the context permits, the Australian Securities Exchange operated by ASX Limited;

"Closing Date" means 18 December 2009;

"Company" or "Bass Metals" means Bass Metals Ltd, ABN 31 109 933 995;

"Directors" mean the directors of the Company;

"Eligible Shareholder" means a Shareholder whose details appear on the Company's register of Shareholders with an address in Australia or New Zealand as at the Record Date;

"Entitlement and Acceptance Form" means the Entitlement and Acceptance Form accompanying this Offer Document;

"Listing Rules" mean the Listing Rules of the ASX;

"New Share" means a new Share proposed to be issued pursuant to this Offer;

"Offer" or “Rights Issue” means the non-renounceable pro rata offer of New Shares at an issue price of 23 cents each on the basis of two (2) New Shares for every nine (9) Shares held on the Record Date pursuant to this Offer Document;

"Offer Document" means this Offer Document dated 4 December 2009;

"Option" means an option to acquire a Share;

"Record Date" means 2 December 2009;

"Section" means a section of this Offer Document;

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

"Shareholder" means a holder of Shares;

"Shortfall" means those New Shares for which valid Applications have not been received by the Closing Date under the Offer; and

"WST" means Western Standard Time.

Bass Metals Ltd

Page 14

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CORPORATE DIRECTORY

Share Registry

Directors

Don Boyer Non Executive Chairman Computershare Investor Services Pty Ltd Mike Rosenstreich Managing Director Level 2 Craig McGown Non Executive Director 45 St Georges Terrace Tony Treasure Non Executive Director Perth WA 6000 Australia Company Secretary Telephone: 1300 557 010

Company Secretary

Solicitors

Susan Hunter

Blakiston & Crabb 1202 Hay Street West Perth WA 6005

Registered / Business Office

16 Thelma Street West Perth WA 6005 Telephone: +61 8 9322 8044 Facsimile: +61 8 9481 2846 Email: admin@bassmetals.com.au Web: www.bassmetals.com.au

Auditor

Grant Thornton Audit Pty Ltd Level 1/10 Kings Park Road West Perth WA 6005

Stock Exchange Listing

Australian Securities Exchange ASX Code “BSM” and “BSMOA”

Bass Metals Ltd

Page 15

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000001 000 1301011221012102012221332120133322113 SAM MR JOHN SMITH 1 FLAT 123 123 SAMPLE STREET THE SAMPLE HILL SAMPLE ESTATE SAMPLEVILLE VIC 3030

Please return completed form to: Computershare Investor Services Pty Limited Locked Bag 2508 Perth Western Australia 6001 Australia Enquiries (within Australia) 1300 557 010 (outside Australia) 61 3 9415 4000 web.queries@computershare.com.au www.computershare.com

Securityholder Reference Number (SRN)

I1234567890

I 1234567890 I N D

Use a black pen. Print in CAPITAL letters A B C 1 2 3 inside the grey areas.

� For your security keep your SRN/HIN confi dential.

Entitlement and Acceptance Form (including Additional Shares)

This personalised form can only be used in relation to the securityholding represented by the SRN or HIN printed above. This is an important document and requires your immediate attention. If you are in doubt about how to deal with this document, please consult your financial or other professional adviser.

Non-Renounceable Entitlement Issue closing 5pm AWST on 18 December 2009

Non-Renounceable Entitlement Issue of 2 New Shares for every 9 Shares registered and entitled to participate at the record date at an issue price of A$0.23 per New Share.

Receipt of the slip below by 5pm AWST on 18 December 2009 with your payment, utilising the payment options detailed overleaf will constitute acceptance in accordance with the terms and conditions of the Offer Document dated 4 December 2009. I/We enclose my/our payment for the amount shown below being payment of A$0.23 per New Share. I/We hereby authorise you to register me/us as the holder(s) of the New Shares allotted to me/us, and I/we agree to be bound by the Constitution of the Company.

A Securityholder Entitlement details Subregister Issuer Existing Shares entitled to participate at Record Date on 2 December 2009 XXX,XXX,XXX Entitlement to New Shares on a 2 for 9 basis XXX,XXX,XXX Amount payable on full acceptance at A$0.23 per New Share X,XXX,XXX.XX Entitlement Number 123456789012

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See back of form for completion guidelines
B S M 2 N R B
SAMP_PAYMENT_000000/000001/000001/i
▼ PLEASE DETACH HERE ▼
cheque(s) Paperclip Please see overleaf for Payment Options Biller Code: 123456
here. Ent: X,XXX Pay: X,XXX Ref No: 1234 5678 9012 3456 78
B Number of New Shares applied for C Number of Additional Shares applied for D Amount enclosed at A$0.23 per New Share
.
A$
Payment Details – Please note that funds are unable to be directly debited from your bank account
E
Drawer Cheque number BSB number Account number Cheque amount
A$
Make your cheque or bank draft payable to “Bass Metals Ltd”
Contact Details
F
Please provide your contact details in case we need to speak to you about this slip
Name of contact person Contact person’s daytime telephone number
( )
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1234567890123456+1234567890-1234+12

How to complete the Entitlement and Acceptance Form (including Additional Shares)

Please note that photocopies of this form will not be accepted. These instructions are cross-referenced to each section of the Entitlement and Acceptance Form.

A Details of your Entitlement based on your Securityholding at 5pm AWST on E Payment Details 2 December 2009 are shown in box A on the front of this Entitlement Form. You can apply for shares by utilising the payment options detailed below. Please note that funds are unable to be directly debited from your bank account. B New Shares Applied for By making your payment using either electronic means or by cheque, bank draft or You can apply to accept either all or part of your Entitlement. Enter in box B the number money order, you confirm that you: of New Shares you wish to accept from your Entitlement. ● agree to all of the terms and conditions as detailed in the Offer Document dated Please ensure you complete Section B on the bottom of the form. 4 December 2009 Your cheque, money order or bank draft must be made in Australian currency and C Additional Shares Applied for drawn on an Australian branch of a financial institution. Such payment must be made Enter the number of additional New Shares you wish to apply for (if any). payable to “Bass Metals Ltd” and crossed “Not Negotiable”. Payments not properly drawn may be rejected. No Eligible Shareholder is assured of receiving any New Shares applied for in excess of their Entitlement and any amount by which applications from Eligible Shareholders Cheques will be processed on the day of receipt and as such, sufficient cleared funds exceed their Entitlements may be scaled back at Bass Metals Ltd’s discretion, in such must be held in your account as cheques returned unpaid may not be manner as Bass Metals Ltd considers is reasonable in the circumstances. re-presented and may result in your Acceptance form being rejected. Paperclip (do not staple) your cheque(s) to the form where indicated. Cash will not be accepted. Please ensure you complete Section C on the bottom of the form. Receipt of payment will not be forwarded. D Acceptance Monies F Contact Details Enter the total amount of acceptance monies payable. To calculate this amount, Enter the name of a contact person and telephone number. These details will only be multiply the total number of New Shares applied for in box B, and if applicable, box C, used in the event that the registry has a query regarding the slip below. by A$0.23.

Please ensure you complete Section D on the bottom of the form.

The directors reserve the right to make amendments to this form where appropriate.

Lodgement of Acceptance

If you are applying for shares and your payment is being made using BPAY[®] , you do not need to return the slip below. Your payment must be received by no later than 3pm AWST on 18 December 2009. Applicants should be aware that their own financial institution may implement earlier cut off times with regards to electronic payment, and should therefore take this into consideration when making payment. Ensure you have read and accurately followed your banking institution’s BPAY FAQ or other instructions prior to making multiple payments for multiple holdings under this offer. Neither CIS nor Bass Metals Ltd accepts any responsibility for loss incurred through incorrectly completed BPAY payments. It is the responsibility of the applicant to ensure that funds submitted through BPAY are received by this time.

If you are paying by cheque, bank draft or money order, the slip below must be received by Computershare Investor Services Pty Limited (CIS) Perth by no later than 5pm AWST on 18 December 2009. You should allow sufficient time for this to occur. A reply paid envelope is enclosed for securityholders in Australia. New Zealand holders will need to affix the appropriate postage. Return the slip below with cheque attached.

Neither CIS nor the Company accepts any responsibility if you lodge the slip below at any other address or by any other means.

Privacy Statement

Personal information is collected on this form by CIS, as registrar for securities issuers (“the issuer”), for the purpose of maintaining registers of securityholders, facilitating distribution payments and other corporate actions and communications. Your personal information may be disclosed to our related bodies corporate, to external service companies such as print or mail service providers, or as otherwise required or permitted by law. If you would like details of your personal information held by CIS, or you would like to correct information that is inaccurate, incorrect or out of date, please contact CIS. In accordance with the Corporations Act 2001, you may be sent material (including marketing material) approved by the issuer in addition to general corporate communications. You may elect not to receive marketing material by contacting CIS. You can contact CIS using the details provided on the front of this form or e-mail privacy@computershare.com.au

If you have any enquiries concerning this form or your entitlement, please contact CIS on 1300 557 010.

This form may not be used to notify your change of address. For information, please contact CIS on 1300 557 010 or www.computershare.com (Certificated/Issuer Sponsored Holders only).

CHESS holders must contact their Controlling Participant to notify a change of address.

® Registered to BPAY Pty Ltd ABN 69 079 137 518

Payment Options:

Biller Code: 123456 Ref No: 1234 5678 9012 3456 78

Telephone & Internet Banking – BPAY

Call your bank, credit union or building society to make this payment from your cheque or savings account. More info: www.bpay.com.au

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Bass Metals Ltd Computershare Investor Services Pty Limited Locked Bag 2508 Perth Western Australia 6001 Australia

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I1234567890
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Entitlement Number:

SAMPLE CUSTOMER SAMPLE STREET SAMPLE STREET SAMPLE STREET SAMPLE STREET SAMPLETOWN TAS 7000