GREENWING RESOURCES LTD — Capital/Financing Update 2016

Dec 14, 2016

ASX ANNOUNCEMENT 15 DECEMBER 2016

==> picture [135 x 49] intentionally omitted <==

BASS NEGOTIATES SUBSTANTIAL REDUCTION IN GRAPHMADA MINE ACQUISITION DEFERRED CONSIDERATION PAYMENTS

Highlights

• Bass has entered into an agreement with the vendor of the Graphmada graphite mine, Stratmin Global Resources Plc (“Stratmin”), for a substantial reduction in future milestone based payment obligations payable to Stratmin.

• Agreement provides for a material reduction of future obligations to Stratmin from previously up to A$13m to now a maximum of A$3.14m, on a revised and accelerated timeframe. The agreement delivers a reduction in the overall final price that Bass will pay for the operating Graphmada graphite mine from A$15.25m to just A$5.39m.

• In addition, Bass’ corporate advisor, Bizzell Capital Partners Pty Ltd, has arranged for the placement of Stratmin’s remaining shareholding in Bass (70m shares) to a number of existing Bass shareholders including all directors and key management.

• Bass proposes to undertake a capital raising of up to A$2,000,000 to facilitate this transaction and to allow Bass to continue to progress with its production optimisation plans at Graphmada.

The Board and Management of Bass Metals Ltd (ASX:BSM) (“Bass” or “the Company”) are pleased to announce that the Company has entered into an agreement with Stratmin Global Resources Plc (“Stratmin”) to pay out at a material discount its future purchase obligations to Stratmin in relation to its acquisition of the Graphmada operating graphite mine in Madagascar. Additionally, Bass has secured the right to buy back its future royalty payments to Stratmin at a value significantly lower than the expected future royalty obligations.

BASS METALS LTD. (ASX: BSM) Email: admin@bassmetals.com.au Phone: (07) 3221 0783 Post: PO Box 1048, Subiaco WA 6904 Web: www.bassmetals.com.au

1

ASX ANNOUNCEMENT 15 DECEMBER 2016

==> picture [135 x 49] intentionally omitted <==

Original Agreement with Stratmin

Under the Company’s original Share Purchase Agreement (“SPA”) with Stratmin, Bass was required to pay A$1,500,000 in cash and issue 75,000,000 shares to Stratmin as part of its Tranche 1 obligations. These obligations were met and concluded in early September 2016.

The SPA also provided, as outlined in our ASX release of 4 April 2016, that Bass make further future payments to Stratmin, as part of the acquisition, as follows:

• Tranche 2 – Bass was to issue to Stratmin A$3,000,000 worth of shares in Bass with the achievement of production milestones on or before 31 December 2017;

• Tranche 3 - Bass was to issue to Stratmin A$5,000,000 worth of shares in Bass with the achievement of production milestones on or before 31 December 2018;

• The total of the Tranche 2 and 3 obligations was to be A$8,000,000 worth of Bass shares to be issued to Stratmin; and

• Additionally, the Company was obliged to pay to Stratmin a 2.5% production Royalty of up to A$5,000,000 in cash over the next 5 years.

New favourable terms reached with Stratmin

Under the terms of the deed of amendment to the SPA, Bass and Stratmin have now agreed that Bass’ obligation to issue $8,000,000 worth of shares shall be waived upon the payment of A$2,640,000 to Stratmin over the following timeframe:

• A$955,000 on or before 19 December 2016;

• A$1,185,000 on or before 15 March 2017; and

• a final payment of A$500,000 on 30 September 2017.

Additionally, Bass has secured an option to buy back its up to A$5,000,000 royalty obligation for the sum of A$500,000 with the option to be exercised by 31 December 2017, with no royalty payments to be made before this date.

Rick Anthon (Bass Metals Chairman), commented “We are delighted with the terms of this revised agreement, which allows us to remove up to A$13,000,000 worth of future potential liabilities for A$3,140,000. This transaction provides great certainty to Bass over it future financial forecasts and allows us to move forward confidently with our ongoing optimisation and expansion plans”.

BASS METALS LTD. (ASX: BSM) Email: admin@bassmetals.com.au Phone: (07) 3221 0783 Post: PO Box 1048, Subiaco WA 6904 Web: www.bassmetals.com.au

2

ASX ANNOUNCEMENT 15 DECEMBER 2016

==> picture [135 x 49] intentionally omitted <==

Bass Metals Director, Peter Wright, also stated “The board remains excited with the enormous potential of the Graphmada project. We are pleased to have arrived at the revised terms and also pleased with the support of a number of existing shareholders in purchasing all of Stratmin’s remaining shareholding in Bass. We wish Stratmin all the best for their future endeavours. We will continue to focus on delivering on the significant potential of the Graphmada mine and firmly believe we have the team and strategy to do so”.

Regards: Tim McManus Chief Executive Officer Phone: (07) 3221 0783 Email: admin@bassmetals.com.au

Please visit us at: www.bassmetals.com.au

BASS METALS LTD. (ASX: BSM) Email: admin@bassmetals.com.au Phone: (07) 3221 0783 Post: PO Box 1048, Subiaco WA 6904 Web: www.bassmetals.com.au

3

ASX ANNOUNCEMENT 15 DECEMBER 2016

==> picture [135 x 49] intentionally omitted <==

ABOUT THE GRAPHMADA LARGE FLAKE GRAPHITE MINE

Bass Metals Ltd. is one of only five publicly listed graphite producers in the world. The Company owns and operates the Graphmada large flake graphite mine, Bass’ flagship project, located in eastern Madagascar. Madagascar has been a recognized producer and exporter of graphite since 1907 and sets the world standard for product quality and flake size.

The Graphmada mine has 40-year mining permits in place, containing

==> picture [237 x 181] intentionally omitted <==

four premium quality, large flake, graphite deposits hosted in weathered graphitic gneiss, a soft, easily minable rock that incurs low mining costs. With all associated mining infrastructure and logistics in place, the mine currently produces and sells a range of graphite concentrates into multiple market segments, to customers in India, the United States and Europe.

Generating revenue through ongoing lowest quartile cost production, the mine is currently being optimised by an experienced management team to 6000 tonnes per annum with improved final graphite concentrate grades, in order to grow cash margins.

Graphmada also has significant potential for low capital intensity expansion. Bass plans to invest capital to expand production to greater than 20,000 tonnes per annum of graphite concentrate sales by late 2018.

The Company has also made the strategic decision, in parallel with the optimisation at Graphmada, to actively explore and develop deposits in the immediate proximity to the mine, with a view to materially expanding existing resource inventories.

The Loharano deposit has provided the bulk of the feed to the Graphmada processing plant and has total JORC compliant Indicated and Inferred resources of 5.7Mt @ 4.1% Grade with a 2% cut-off[1] . These resources are to a depth of only 6 meters, and mineralization is known to go to depth with increasing grade, and is open in all directions.

With the Company having a strong community engagement program and being well down the path in achieving its optimisation plans and growing its resource inventory, the team at Bass is confident of its plans for expansion and its future value creation for shareholders.

1 These estimates were prepared and first disclosed by Stratmin Global Resource PLC under the JORC Code 2004. The estimates have not been updated to JORC Code 2012 on the basis that the information has not materially changed since it was last reported. Reference is made to the Company's announcement of 2 September 2015, which provides further detail regarding this information.

BASS METALS LTD. (ASX: BSM)

Email: admin@bassmetals.com.au Phone: (07) 3221 0783 Post: PO Box 1048, Subiaco WA 6904 Web: www.bassmetals.com.au

4

ASX ANNOUNCEMENT 15 DECEMBER 2016

==> picture [135 x 49] intentionally omitted <==

DISCLAIMER & CAUTIONARY STATEMENTS

Disclaimer

This document has been prepared by Bass Metals Limited (the “Company”). It should not be considered as an invitation or offer to subscribe for or purchase any securities in the Company or as an inducement to make an invitation or offer with respect to those securities. No agreement to subscribe for securities in the Company will be entered into on the basis of this document. This document is provided on the basis that neither the Company nor its officers, shareholders, related bodies corporate, partners, affiliates, employees, representatives and advisers make any representation or warranty (express or implied) as to the accuracy, reliability, relevance or completeness of the material contained in the document and nothing contained in the document is, or may be relied upon as a promise, representation or warranty, whether as to the past or the future. The Company hereby excludes all warranties that can be excluded by law.

The document may contain forward-looking information and prospective financial material, which is predictive in nature and may be affected by inaccurate assumptions or by known or unknown risks and uncertainties, and may differ materially from results ultimately achieved. All references to future production, production targets and resource targets and infrastructure access are subject to the completion of all necessary feasibility studies, permitting, construction, financing arrangements and infrastructure-related agreements. Where such a reference is made, it should be read subject to this paragraph and in conjunction with further information about the Mineral Resources and Exploration Results, as well as the Competent Persons' statements. All persons should consider seeking appropriate professional advice in reviewing the document and all other information with respect to the Company and evaluating the business, financial performance and operations of the Company. Neither the provision of the document nor any information contained in the document or subsequently communicated to any person in connection with the document is, or should be taken as, constituting the giving of investment advice to any person.

Forward-looking statements

This document may contain certain forward-looking statements. Such statements are only predictions, based on certain assumptions and involve known and unknown risks, uncertainties and other factors, many of which are beyond the Company’s control. Actual events or results may differ materially from the events or results expected or implied in any forward-looking statement. The inclusion of such statements should not be regarded as a representation, warranty or prediction with respect to the accuracy of the underlying assumptions or that any forward looking statements will be or are likely to be fulfilled. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date of this document (subject to securities exchange disclosure requirements). The information in this document does not take into account the objectives, financial situation or particular needs of any person. Nothing contained in this document constitutes investment, legal, tax or other advice.

BASS METALS LTD. (ASX: BSM)

Email: admin@bassmetals.com.au Phone: (07) 3221 0783 Post: PO Box 1048, Subiaco WA 6904 Web: www.bassmetals.com.au

5