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H3 ENERGY LIMITED Proxy Solicitation & Information Statement 2020

Jan 22, 2020

65034_rns_2020-01-22_ead39a03-f8aa-40a3-af6d-b78278a87595.pdf

Proxy Solicitation & Information Statement

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General Meeting Notice Of Meeting & Proxy Form 23 January 2020

Please find following the Notice of Meeting and sample proxy form for a General Meeting of Whitebark Energy Ltd to be held at 8:30am on Monday, 24 February 2020 at Level 2, 6 Thelma Street, West Perth.

End

This ASX announcement was approved and authorised for release by David Messina, Managing Director Whitebark Energy

For further information: David Messina Managing Director Ph: +61 8 6555 6000

Cameron Morse FTI Consulting Ph: +61 8 9321 8533

E [email protected]

whitebarkenergy.com PO Box 1195 West Perth WA 6872 Australia

T +61 8 6555 6000 Level 2, 6 Thelma Street West Perth WA 6005

WHITEBARK ENERGY LIMITED

ACN 079 432 796

NOTICE OF GENERAL MEETING

Notice is given that the Meeting will be held at:

TIME : 8:30 am (WST) DATE : Monday, 24 February 2020 PLACE : Level 2, 6 Thelma Street WEST PERTH WA 6005

The business of the Meeting affects your shareholding and your vote is important.

This Notice of Meeting should be read in its entirety. If Shareholders are in doubt as to how they should vote, they should seek advice from their professional advisers prior to voting.

The Directors have determined pursuant to Regulation 7.11.37 of the Corporations Regulations 2001 (Cth) that the persons eligible to vote at the Meeting are those who are registered Shareholders at 8:30 AM on Saturday, 22 February 2020.

BUSINESS OF THE MEETING

AGENDA

1. RESOLUTION 1 – RATIFICATION OF DECEMBER CAPITAL RAISING SHARES – ASX LISTING RULE 7.1

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

“That, for the purposes of ASX Listing Rule 7.4 and for all other purposes, Shareholders ratify the issue of 381,756,206 Shares on the terms and conditions set out in the Explanatory Statement.”

2. RESOLUTION 2 – RATIFICATION OF DECEMBER CAPITAL RAISING SHARES – ASX LISTING RULE 7.1A

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

“That, for the purposes of ASX Listing Rule 7.4 and for all other purposes, Shareholders ratify the issue of 98,043,794 Shares on the terms and conditions set out in the Explanatory Statement.”

3. RESOLUTION 3 – ISSUE OF CONSIDERATION SHARES TO POINT LOMA RESOURCES

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

“That, for the purposes of ASX Listing Rule 7.1 and for all other purposes, approval is given for the Company to issue up to that number of Shares, which when multiplied by the issue price, equates to C$2,000,000 to Point Loma Resources on the terms and conditions set out in the Explanatory Statement.”

4. RESOLUTION 4 – APPROVAL FOR RELATED PARTY TO PARTICIPATE IN DECEMBER 2019 CAPITAL RAISING – CHARLES MORGAN

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

“That, for the purposes of section 195(4) and section 208 of the Corporations Act, ASX Listing Rule 10.11 and for all other purposes, approval is given for the Company to issue up to 5,000,000 Shares at $0.01 per Share to Charles Morgan, a Director, (or his nominee/s) under the Capital Raising on the terms and conditions set out in the Explanatory Statement.”

5. RESOLUTION 5 – APPROVAL FOR RELATED PARTY TO PARTICIPATE IN DECEMBER 2019 CAPITAL RAISING – STEPHEN KEENIHAN

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

“That, for the purposes of section 195(4) and section 208 of the Corporations Act, ASX Listing Rule 10.11 and for all other purposes, approval is given for the Company to issue up to 10,000,000 Shares at $0.01 per Share to Stephen Keenihan, a Director, (or his nominee/s) under the Capital Raising on the terms and conditions set out in the Explanatory Statement.”

6. RESOLUTION 6 – APPROVAL FOR RELATED PARTY TO PARTICIPATE IN DECEMBER 2019 CAPITAL RAISING – DAVID MESSINA

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

“That, for the purposes of section 195(4) and section 208 of the Corporations Act, ASX Listing Rule 10.11 and for all other purposes, approval is given for the Company to issue up to 5,000,000 Shares at $0.01 per Share to David Messina, a Director, (or his nominee/s) under the Capital Raising on the terms and conditions set out in the Explanatory Statement.”

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7. RESOLUTION 7- APPROVAL FOR WILLIAM SMITH TO PARTICIPATE IN DECEMBER 2019 CAPITAL RAISING

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

“That, for the purposes of ASX Listing Rule 10.11 and for all other purposes, approval is given for the Company to issue up to 2,000,000 Shares at $0.01 per Share to William Smith (or his nominee) under the Capital Raising on the terms and conditions set out in the Explanatory Statement.”

8. RESOLUTION 8 – ISSUE OF OPTIONS TO RELATED PARTY – CHARLES MORGAN

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

“That, for the purposes of section 195(4) and section 208 of the Corporations Act, ASX Listing Rule 10.11 and for all other purposes, approval is given for the Company to issue 20,000,000 Options to Charles Morgan, a Director, (or his nominee) on the terms and conditions set out in the Explanatory Statement.”

9. RESOLUTION 9 – ISSUE OF OPTIONS TO RELATED PARTY – STEPHEN KEENIHAN

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

“That, for the purposes of section 195(4) and section 208 of the Corporations Act, ASX Listing Rule 10.11 and for all other purposes, approval is given for the Company to issue 20,000,000 Options to Stephen Keenihan, a Director, (or his nominee) on the terms and conditions set out in the Explanatory Statement.”

10. RESOLUTION 10 – ISSUE OF OPTIONS TO RELATED PARTY – DAVID MESSINA

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

“That, for the purposes of section 195(4) and section 208 of the Corporations Act, ASX Listing Rule 10.11 and for all other purposes, approval is given for the Company to issue 40,000,000 Options to David Messina, a Director, (or his nominee) on the terms and conditions set out in the Explanatory Statement.”

11. RESOLUTION 11 – ISSUE OF SHARES TO RELATED PARTY – DAVID MESSINA

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

“That, for the purposes of ASX Listing Rule 10.11 and for all other purposes, approval is given for the Company to issue 4,000,000 Shares to David Messina, a Director, (or his nominee) on the terms and conditions set out in the Explanatory Statement.”

Dated: 21 January 2020

By order of the Board

==> picture [112 x 36] intentionally omitted <==

Kevin Hart Company Secretary Whitebark Energy Limited

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Voting in person

To vote in person, attend the Meeting at the time, date and place set out above.

Voting by proxy

To vote by proxy, please complete and sign the enclosed Proxy Form and return by the time and in accordance with the instructions set out on the Proxy Form.

In accordance with section 249L of the Corporations Act, Shareholders are advised that:

each Shareholder has a right to appoint a proxy;
the proxy need not be a Shareholder of the Company; and
a Shareholder who is entitled to cast 2 or more votes may appoint 2 proxies and may specify the proportion or number of votes each proxy is appointed to exercise. If the member appoints 2 proxies and the appointment does not specify the proportion or number of the member’s votes, then in accordance with section 249X(3) of the Corporations Act, each proxy may exercise one-half of the votes.

Shareholders and their proxies should be aware that changes to the Corporations Act made in 2011 mean that:

if proxy holders vote, they must cast all directed proxies as directed; and
any directed proxies which are not voted will automatically default to the Chair, who must vote the proxies as directed.

Eligibility to Attend and Vote at the Meeting Voting Exclusion Statements

1. RESOLUTIONS 1 & 2 - RATIFICATION OF DECEMBER CAPITAL RAISING SHARES

The Company will disregard any votes cast in favour of this Resolution by or on behalf of:

(a) a person who participated in the issue; or
(b) an associate of that person or those persons.

However, this does not apply to a vote cast in favour of this Resolution by:

(a) a person as proxy or attorney for a person who is entitled to vote on this Resolution, in accordance with directions given to the proxy or attorney to vote on the resolution in that way; or
(b) the chair of the meeting as proxy or attorney for a person who is entitled to vote on this Resolution, in accordance with a direction given to the chair to vote on this Resolution as the chair decides; or
(c) a holder acting solely in a nominee, trustee, custodial or other fiduciary capacity on behalf of a beneficiary provided the following conditions are met:
(i) the beneficiary provides written confirmation to the holder that the beneficiary is not excluded from voting, and is not an associate of a person excluded from voting, on this Resolution; and
(ii) the holder votes on this Resolution in accordance with directions given by the beneficiary to the holder to vote in that way.

2. RESOLUTION 3 - ISSUE OF CONSIDERATION SHARES TO POINT LOMA RESOURCES

The Company will disregard any votes cast in favour of this Resolution by or on behalf of:

(a) a person who is expected to participate in, or who will obtain a material benefit as a result of, the proposed issue (except a benefit solely by reason of being a holder of ordinary securities in the Company); or
(b) an associate of that person or those persons.

However, this does not apply to a vote cast in favour of this Resolution by:

(a) a person as proxy or attorney for a person who is entitled to vote on this Resolution, in accordance with directions given to the proxy or attorney to vote on the resolution in that way; or
(b) the chair of the meeting as proxy or attorney for a person who is entitled to vote on this Resolution, in accordance with a direction given to the chair to vote on this Resolution as the chair decides; or
(c) a holder acting solely in a nominee, trustee, custodial or other fiduciary capacity on behalf of a beneficiary provided the following conditions are met:

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(i) the beneficiary provides written confirmation to the holder that the beneficiary is not excluded from voting, and is not an associate of a person excluded from voting, on this Resolution; and
(ii) the holder votes on this Resolution in accordance with directions given by the beneficiary to the holder to vote in that way.

3. RESOLUTIONS 4, 5, 6 & 7 – APPROVAL FOR PARTICIPATION IN DECEMBER CAPITAL RAISING

The Company will disregard any votes cast in favour of these Resolutions by or on behalf of:

(a) Charles Morgan (or his nominee/s) in relation to Resolution 4, Stephen Keenihan (or his nominee/s) in relation to Resolution 5, David Messina (or his nominee/s) in relation to Resolution 6 and William Smith (or his nominee/s) in relation to Resolution 7, and any other person who will obtain a material benefit as a result of the issue of the securities (except a benefit solely by reason of being a holder of ordinary securities in the Company); or
(b) an associate of that person or those persons.

However, this does not apply to a vote cast in favour of this Resolution by:

(a) a person as proxy or attorney for a person who is entitled to vote on Resolutions 4, 5, 6 & 7, in accordance with directions given to the proxy or attorney to vote on Resolutions 4, 5, 6 & 7 in that way; or
(b) the chair of the meeting as proxy or attorney for a person who is entitled to vote on Resolutions 4, 5, 6 & 7, in accordance with a direction given to the chair to vote on Resolutions 4, 5, 6 & 7 as the chair decides; or
(c) a holder acting solely in a nominee, trustee, custodial or other fiduciary capacity on behalf of a beneficiary provided the following conditions are met:
(i) the beneficiary provides written confirmation to the holder that the beneficiary is not excluded from voting, and is not an associate of a person excluded from voting, on Resolutions 4, 5, 6 & 7; and
(ii) the holder votes on Resolutions 4, 5, 6 & 7 in accordance with directions given by the beneficiary to the holder to vote in that way.

4. RESOLUTIONS 8, 9 & 10 – ISSUES OF OPTIONS TO RELATED PARTIES

The Company will disregard any votes cast in favour of Resolutions 8, 9 & 10 by or on behalf of:

(a) Charles Morgan, Stephen Keenihan and David Messina (or their respective nominee/s) and any other person who will obtain a material benefit as a result of the issue of the securities (except a benefit solely by reason of being a holder of ordinary securities in the Company); or
(b) an associate of that person or those persons.

However, this does not apply to a vote cast in favour of this Resolution by:

(a) a person as proxy or attorney for a person who is entitled to vote on this Resolution, in accordance with directions given to the proxy or attorney to vote on the resolution in that way; or
(b) the chair of the meeting as proxy or attorney for a person who is entitled to vote on this Resolution, in accordance with a direction given to the chair to vote on this Resolution as the chair decides; or
(c) a holder acting solely in a nominee, trustee, custodial or other fiduciary capacity on behalf of a beneficiary provided the following conditions are met:
(i) the beneficiary provides written confirmation to the holder that the beneficiary is not excluded from voting, and is not an associate of a person excluded from voting, on this Resolution; and
(ii) the holder votes on this Resolution in accordance with directions given by the beneficiary to the holder to vote in that way.

5. RESOLUTION 11 – ISSUE OF SHARES TO RELATED PARTY – DAVID MESSINA

The Company will disregard any votes cast in favour of Resolution 11 by or on behalf of:

(a) David Messina (or his nominee/s) and any other person who will obtain a material benefit as a result of the issue of the securities (except a benefit solely by reason of being a holder of ordinary securities in the Company); or
(b) an associate of that person or those persons.

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However, this does not apply to a vote cast in favour of this Resolution by:

(a) a person as proxy or attorney for a person who is entitled to vote on this Resolution, in accordance with directions given to the proxy or attorney to vote on the resolution in that way; or
(b) the chair of the meeting as proxy or attorney for a person who is entitled to vote on this Resolution, in accordance with a direction given to the chair to vote on this Resolution as the chair decides; or
(c) a holder acting solely in a nominee, trustee, custodial or other fiduciary capacity on behalf of a beneficiary provided the following conditions are met:
(i) the beneficiary provides written confirmation to the holder that the beneficiary is not excluded from voting, and is not an associate of a person excluded from voting, on this Resolution; and
(ii) the holder votes on this Resolution in accordance with directions given by the beneficiary to the holder to vote in that way.

Voting Prohibition Statements

1. RESOLUTIONS 4, 5, 6 & 7 – APPROVAL FOR PARTICIPATION IN DECEMBER CAPITAL RAISING

A person appointed as a proxy must not vote, on the basis of that appointment, on Resolutions 4, 5, 6 & 7 if:

(a) the proxy is either:
(i) a member of the Key Management Personnel; or
(ii) a Closely Related Party of such a member; and
(b) the appointment does not specify the way the proxy is to vote on this Resolution.

Provided the Chair is not an Excluded Party of Resolutions 4, 5, 6 & 7 the above prohibition does not apply if:

(a) the proxy is the Chair; and
(b) the appointment expressly authorises the Chair to exercise the proxy even though Resolutions 4, 5, 6 & 7 are connected directly or indirectly with the remuneration of a member of the Key Management Personnel.

2. RESOLUTIONS 8, 9 & 10 – ISSUE OF OPTIONS TO RELATED PARTIES

A person appointed as a proxy must not vote, on the basis of that appointment, on Resolutions 8, 9 & 10 if:

(a) the proxy is either:
(i) a member of the Key Management Personnel; or
(ii) a Closely Related Party of such a member; and
(b) the appointment does not specify the way the proxy is to vote on Resolutions 8, 9 & 10.

Provided the Chair is not an Excluded Party of Resolutions 8, 9 & 10, the above prohibition does not apply if:

(a) the proxy is the Chair; and
(b) the appointment expressly authorises the Chair to exercise the proxy even though Resolutions 8, 9 & 10 are connected directly or indirectly with remuneration of a member of the Key Management Personnel.

3. RESOLUTION 11 – ISSUES OF SHARES TO RELATED PARTY – DAVID MESSINA

A person appointed as a proxy must not vote, on the basis of that appointment, on Resolution 11 if:

(a) the proxy is either:
(i) a member of the Key Management Personnel; or
(ii) a Closely Related Party of such a member; and
(b) the appointment does not specify the way the proxy is to vote on Resolution 11.

Provided the Chair is not an Excluded Party of Resolution 11, the above prohibition does not apply if:

(a) the proxy is the Chair; and
(b) the appointment expressly authorises the Chair to exercise the proxy even though Resolution 11 are connected directly or indirectly with remuneration of a member of the Key Management Personnel.

Should you wish to discuss the matters in this Notice of Meeting

please do not hesitate to contact the Company Secretary on +61 8 6555 6000 .

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EXPLANATORY STATEMENT

This Explanatory Statement has been prepared to provide information which the Directors believe to be material to Shareholders in deciding whether or not to pass the Resolutions.

1. OVERVIEW - ACQUISITION OF WIZARD LAKE ASSETS

1.1 Background to the Acquisition

On 18 December 2019, the Company announced that its 100% owned subsidiary, Salt Bush Energy Ltd ( SBE ), had executed a Definitive Agreement ( Agreement ) on 16 December 2019 to swap assets with its joint venture partner, the Toronto Exchange Listed, Point Loma Resources Limited (TSXV:PLX) ( PLX ) ( Acquisition ).

Pursuant to the Agreement, PLX agreed to sell, and SBE agreed to purchase, the remaining interest in the Wizard Lake Oilfield from PLX. Details of the consideration payable by the Company under the Acquisition are set out in Section 1.2 below.

In April 2017, the Company acquired a 20% direct interest in the assets of PLX, providing access to modest production and a significant land position of 210,000 net acres. The Company diligently assessed the wide variety of exploration/development assets, determining that the Wizard Lake Oilfield presented the best risk-reward opportunity to drill and develop.

The recent drilling success at the Wizard Lake Oilfield has significantly de-risked the project which is now in development mode. The acquisition of PLX’s interest in the Wizard Lake oilfield enables the Company to be the sole beneficiary of the development of the project, which is anticipated to deliver strong financial benefits over the coming years. Whitebark has agreed as part of the acquisition to transfer its minority interests in the Point Loma Joint Venture assets back to PLX, relinquishing all ongoing obligations and the abandonment and other liabilities associated with these non-core assets.

1.2 Consideration for the Acquisition

The Company and PLX will make the following asset exchanges and the Company will pay to PLX the following consideration for the Acquisition:

(a) Step 1: The following actions occurred on or before 24 December 2019 ( Step 1 Closing Date ):
(i) SBE will transfer its minority interest in and convey assets to PLX comprising of or relating to:
- (A) the Salt Bush Lands;
- (B) the Salt Bush Major Facilities;
- (C) the Salt Bush Material Contracts; and
- (D) the Salt Bush Wells,
  - (together the Salt Bush Assets
(ii) PLX will transfer to SBE an undivided 10% gross working interest in those Wizard Lake assets comprising of or relating to:
- (A) the Point Loma Lands;
- (B) the Point Loma Major Facilities;
- (C) the Point Loma Material Contracts; and
- (D) the Point Loma Wells,

(together the Point Loma Step 1 Assets ).

(iii) SBE will make a cash payment to PLX of C$1,200,000 ( Step 1 Purchase Price ).
(b) Step 2: The following actions will occur on the date that is ten (10) business days following completion by SBE of financing between 1 January 2020 and 31 March 2020 for the

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C$2,800,000 cash portion of the Step 2 Purchase Price (as defined in Section 1.2(b)(i) below) ( Step 2 Closing Date ):

(i) PLX will transfer and convey those Point Loma Assets excluding:
(A) the Point Loma Step 1 Assets;
(B) an undivided 10% gross working interest in each of the Rex 1 Well and Rex 2 Wells ( Point Loma Deferred Assets ); and
(C) a 10% working interest in the Rex 3 Well ( Point Loma Step 2 Holdback Interest ),

(together, the Point Loma Step 2 Assets ).

(ii) SBE will:
(A) make a cash payment to PLX of C$2,300,000, plus or minus the net amount of all benefits and obligations of any kind or nature received, accruing, payable or paid in respect of the Assets, including the maintenance, development, capital and operating costs, royalties and proceeds from the sale of production, to be apportioned between SEB and PLX on an accrual basis; and
(B) procure for the Company to issue to PLX that number of fully paid ordinary shares in the capital of the Company ( Shares ) which equates to C$2,000,000. The first lot of C$1,000,000 shares will be held in escrow for 4 months. The second lot of C$1,000,000 will be held in escrow and only released following the successful transfer of the residual 10% WI in Rex 1 and Rex 2,

(together the Step 2 Purchase Price ).

(iii) SBE will release PLX from all further obligations to repay the Wizard Lake Payout Account.
(iv) PLX will relinquish all ownership and all rights to acquire ownership of the Wizard Lake Facilities and will enter into a custom processing agreement pursuant to which PLX production from the Wizard Lake Deferred Assets will be custom processed at the Wizard Lake Facilities subject to processing fees in accordance with a separate agreement between the parties and on standard commercial terms.
(v) After the Step 2 Closing Date:
- (A) If applications to transfer the Rex 3 Well licence and two pipeline licences (Licences Nos. 60891 and 60897) from PLX to SBE (Step 2 LTA) are received no later than 120 days following the Step 2 Closing Date (or such longer period as agreed in writing between the parties) then, within five (5) Business Days following receipt of Step 2 LTA approval, PLX will transfer and convey the Point Loma Step 2 Holdback Interest to SBE and SBE will make a C$500,000 cash payment to PLX, and the payment amount will added to the Step 2 Purchase Price.
- (B) If Step 2 LTA approval is not received within the time period specified in Section 1.2(b)(v)(A) above, then PLX will retain the Point Loma Step 2 Holdback Interest and the cash payment will not be made by SBE, unless the time frame is extended by mutual agreement between the parties.
(c) Step 3: The following actions will occur on 31 December 2020, or, the day which is two (2) business days following receipt of approval of the application to transfer the Rex 1 Well and Rex 2 Well licences from PLX to SBE:
(i) PLE will transfer and convey the Point Loma Deferred Assets to SBE; and
(ii) SBE will procure for the Company to release from escrow to PLX that number of Shares which equates to C$1,000,000.

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1.3 Funding the Acquisition

As announced on 18 December 2019, the Company has undertaken a share placement to new, existing, family office, sophisticated and professional investors to raise approximately $5,000,000 (before costs) ( Capital Raising ).

The cash consideration payable to PLX under the Acquisition amounts to C$4,000,000, which the Company intends to fund from the proceeds of the Capital Raising, new equity and/or funding package with a major financial institution that the Company is in advanced discussions with.

The Capital Raising was completed on 27 December 2019 by the issue of 479,800,000 Shares at an issue price of AUD$0.01 per Share ( Issue Price ) to raise 4,798,000 before costs. The Capital Raising was conducted via the Company’s ASX Listing Rules 7.1 and 7.1A issuance capacities in the following allotments:

(a) 381,756,206 Shares were issued under the Company’s ASX Listing Rule 7.1 issuance capacity; and
(b) 98,043,794 Shares were issued under the Company’s ASX Listing Rule 7.1A issuance capacity,

(together, the Capital Raising Shares ).

Shares issued under the Capital Raising are sought to be ratified under Resolutions 1 and 2.

The Issue Price represents a 17.3% discount to AUD$0.0121 (being the volume weighted average market price ( VWAP )) for the Shares over the last 10 days on which sales in the Shares were recorded before 18 December 2019.

Directors (or their nominees) seek to participate in the Capital Raising up to AUD$200,000. The Company is seeking Shareholder approval for the Directors’ (or their nominees) participation in the Capital Raising pursuant to Resolutions 4, 5 and 6 and Shareholder approval for the participation of William Smith in the Capital Raising pursuant to Resolution 7 (thereby bringing the total amount raised under the Capital Raising to $5,000,000). In addition to the proposed Directors’ participation, Company staff have participated in the Capital Raising for an amount of AUD$115,000.

Morgans Financial Limited (ABN 49 010 669 726) AFSL 235410 acted as lead manager to the Capital Raising and Adelaide Equity & Partners Ltd (ABN 59 119 059 559) AFSL 313143 as corporate advisor.

2. RESOLUTIONS 1 & 2 – RATIFICATION OF DECEMBER CAPITAL RAISING SHARES

2.1 General

On 27 December 2019, the Company issued a total of 479,800,000 Shares at an issue price of $0.01 per Share to raise $4,798,000.

381,756,206 Shares were issued pursuant to the Company’s issuance capacity under ASX Listing Rule 7.1 and 98,043,794 Shares were issued pursuant to the Company’s issuance capacity under ASX Listing Rule 7.1A.

Resolutions 1 & 2 seeks Shareholder ratification pursuant to ASX Listing Rule 7.4 for the issue of those Shares ( Ratification ).

2.2 Resolution 1 – ASX Listing Rule 7.1

ASX Listing Rule 7.1 provides that a company must not, subject to specified exceptions, issue or agree to issue more equity securities during any 12 month period than that amount which represents 15% of the number of fully paid ordinary securities on issue at the commencement of that 12 month period.

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The issue of Shares pursuant to the Company’s ASX Listing Rule 7.1 issuance capacity the subject of the Ratification, do not fit within any of these exceptions and, as it has not yet been approved by the Company’s Shareholders, it effectively uses up part of the Company’s 15% limit under ASX Listing Rule 7.1, reducing the Company’s capacity to issue further equity securities without Shareholder approval for the 12 month period following 27 December 2019.

ASX Listing Rule 7.4 sets out an exception to ASX Listing Rule 7.1. It provides that where a company in general meeting ratifies the previous issue of securities made pursuant to ASX Listing Rule 7.1 (and provided that the previous issue did not breach ASX Listing Rule 7.1) those securities will be deemed to have been made with shareholder approval for the purpose of ASX Listing Rule 7.1.

By ratifying this issue, the Company will retain the flexibility to issue equity securities in the future up to the 15% annual placement capacity set out in ASX Listing Rule 7.1 without the requirement to obtain prior Shareholder approval.

2.3 Resolution 2 – ASX Listing Rule 7.1A

ASX Listing Rule 7.1A provides that in addition to issues permitted without prior shareholder approval under ASX Listing Rule 7.1, an entity that is eligible and obtains shareholder approval under ASX Listing Rule 7.1A may issue or agree to issue during the period for which the approval is valid a number of quoted equity securities which represents 10% of the number of fully paid ordinary securities on issue at the commencement of that 12 month period as adjusted in accordance with the formula in ASX Listing Rule 7.1.

Where an eligible entity obtains shareholder approval to increase its placement capacity under ASX Listing Rule 7.1A then any ordinary securities issued under that additional placement capacity:

(a) will not be counted in variable “A” in the formula in ASX Listing Rule 7.1A; and
(b) are counted in variable “E”,

until their issue has been ratified under ASX Listing Rule 7.4 (and provided that the previous issue did not breach ASX Listing Rule 7.1A) or 12 months has passed since their issue.

By ratifying the issue the subject of Resolution 2, the base figure (i.e. variable “A”) in which the Company’s 15% and 10% annual placement capacities are calculated will be a higher number which in turn will allow a proportionately higher number of securities to be issued without prior Shareholder approval.

2.4 Technical information required by ASX Listing Rule 7.4

Pursuant to and in accordance with ASX Listing Rule 7.5, the following information is provided in relation to the Ratification:

(a) the Shares the subject of the Ratification were issued as part of the Capital Raising to new and existing institutional, family office, sophisticated and professional investors, as announced by the Company on 18 December 2019, none of these subscribers are related parties of the Company. Morgans Corporate Limited acted as lead manager to the placement and Adelaide Equity Partners as corporate advisor;
(b) 479,800,000 Shares were issued on the following basis:
(i) 381,756,206 Shares issued pursuant to the Company’s ASX Listing Rule 7.1 issuance capacity; and
(ii) 98,043,794 Shares issued pursuant to the Company’s ASX Listing Rule 7.1A issuance capacity.
(c)
the issue price was $0.01 per Share;
(d) the Shares issued were all fully paid ordinary shares in the capital of the Company issued on the same terms and conditions as the Company’s existing Shares; and
(e) as announced by the Company on 18 December 2019, the funds raised from this issue were applied to the staged Acquisition of remaining assets at Wizard Lake future development activities and growth initiatives.

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3. RESOLUTION 3 – ISSUE OF CONSIDERATION SHARES TO POINT LOMA RESOURCES

3.1 General

Resolution 3 seeks Shareholder approval to issue to PLX up to that number of Shares, which when multiplied by the issue price, equates to C$2,000,000 as part consideration for the Acquisition ( Placement ).

The background to the issue the subject of this Resolution, including the material terms of the Acquisition Agreement, are summarised in Section 1.2(b)(ii)(B) above.

ASX Listing Rule 7.1 provides that a company must not, subject to specified exceptions, issue or agree to issue more equity securities during any 12 month period than that amount which represents 15% of the number of fully paid ordinary securities on issue at the commencement of that 12 month period.

The Placement does not fit within any of the exceptions mentioned above. While the Placement does not exceed the 15% limit in ASX Listing Rule 7.1 and can therefore be made without breaching that, the Company wishes to retain as much flexibility as possible to issue additional equity securities into the future without having to obtain Shareholder approval under ASX Listing Rule 7.1. To do this, the Company seeks Shareholder approval for the issue of the Shares under the Placement so that it does not use up its 15% limit on issuing equity securities without Shareholder approval as set out in ASX Listing Rule 7.1.

The effect of Resolution 3 will be to allow the Company to issue the Shares pursuant to the Placement during the period of 3 months after the Meeting (or a longer period, if allowed by ASX), without using the Company’s 15% annual placement capacity.

3.2 Technical information required by ASX Listing Rule 7.1

Pursuant to and in accordance with ASX Listing Rule 7.3, the following information is provided in relation to the Placement:

(a) The Shares will be issued to PLX, who is not a related party of the Company;
(b) the number of Shares to be issued is up to that number of Shares which, when multiplied by the issue price, equals C$2,000,000. Set out below is a worked example of the number of Shares that may be issued under the Placement.

Assuming a share issue price of 1.2 cents (being the closing price on Friday 16 January 2020) and the current AUD/CAD exchange rate of AUD$1 = C$0.9, the C$2,000,000 consideration would result in the issue of 185.33m shares.

The table below sets out that number of Shares that may be issued if the exchange rate is varied by +/- 10%.

AUD / CAD Exchange rate	AUD ($)	No of shares issued at AUD$0.012	Potential dilution (%)
1.0–current rate plus 10%	2,220,000	185,000,000	6.12
0.9–current rate	2,000,000	166,666,667	5.51
0.8–current rate minus 10%	2,500,000	208,333,333	6.89

The table below set out that number of Shares that may be issued if the Company’s share price is varied by +/- 10%, assuming an exchange rate of AUD$1 = C$0.9 (being the exchange between the Australian dollar and the Canadian dollar on Friday 16 January 2020).

WBE Share Price	AUD ($)	No of shares issued	Potential dilution (%)
$0.0132–Closing price 16 January 2020 plus 10%	2,000,000	151,515,152	5.01
$0.012–Closing price 16 January 2020	2,000,000	166,666,667	5.51
$0.0108–Closing price 16 January 2020 minus 10%	2,000,000	185,185,185	6.12

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(c) the issue price of the Shares will be the 30 day VWAP immediately preceding the Step 2 Closing Date;
(d) the Shares issued will be fully paid ordinary shares in the capital of the Company issued on the same terms and conditions as the Company’s existing Shares;
(e) the Shares will be issued at the Step 2 Closing Date, being no later than 31 March 2020, and otherwise no later than 3 months after the date of the Meeting (or such later date to the extent permitted by any ASX waiver or modification of the ASX Listing Rules) and it is intended that issue of the Shares will occur on the same date;
(f) the Shares will be issued for nil cash consideration in satisfaction of the acquisition of Point Loma Step 2 Assets, described above at Section 1.2;
(g) no funds will be raised from the Placement as the Shares are being issued in consideration for the acquisition of Point Loma Step 2 Assets, described above at Section 1.2; and
(h) the Shares issued under the Placement are being issued pursuant to the Agreement, a summary of the material terms of the agreement are set out in Section 1.2.

4. RESOLUTIONS 4, 5, 6 & 7 – APPROVAL FOR PARTICIPATION IN DECEMBER CAPITAL RAISING – MESSRS MORGAN, KEENIHAN, MESSINA AND SMITH

4.1 General

Pursuant to the Capital Raising announced on 18 December 2019, described at Section 1.3 above, Messrs Morgan, Keenihan, Messina and Smith (or their respective nominees) ( Related Parties ) wish to participate in the Capital Raising on the same terms as other investors.

Resolutions 4, 5, 6 and 7 seek Shareholder approval for the issue of up to a total of 22,000,000 Capital Raising Shares to Messrs Morgan, Keenihan, Messina and Smith (or their respective nominees) arising from their proposed participation in the Capital Raising ( Participation ).

4.2 Chapter 2E of the Corporations Act and ASX Listing Rule 10.11

For a public company, or an entity that the public company controls, to give a financial benefit to a related party of the public company, the public company or entity must:

(a) obtain the approval of the public company’s members in the manner set out in sections 217 to 227 of the Corporations Act; and
(b) give the benefit within 15 months following such approval,

unless the giving of the financial benefit falls within an exception set out in sections 210 to 216 of the Corporations Act.

The Participation will result in the issue of Capital Raising Shares which constitutes giving a financial benefit and Messrs Morgan, Keenihan and Messina are related parties of the Company by virtue of being Directors.

ASX Listing Rule 10.11 also requires shareholder approval to be obtained where an entity issues, or agrees to issue, securities to a related party, or a person whose relationship with the entity or a related party is, in ASX’s opinion, such that approval should be obtained unless an exception in ASX Listing Rule 10.12 applies.

The Participation the subject of Resolution 7 will result in the issue of Capital Raising Shares, which constitutes giving a financial benefit to William Smith. William Smith is the sole director of the Company’s wholly owned subsidiary, Salt Bush Energy Ltd (a body corporate incorporated pursuant to the laws of the Province of Alberta). ASX has deemed William Smith to be a person whose relationship with the entity or a related party is, in ASX’s opinion, such that shareholder approval should be obtained in accordance with ASX Listing Rule 10.11.5.

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It is proposed that all Directors be permitted to participate under the Capital Raising, as such, the Directors have been unable to form a quorum to consider whether one of the exceptions set out in sections 210 to 216 of the Corporations Act or ASX Listing Rule 10.15 applies to these issues. Accordingly, Shareholder approval is sought for Messrs Morgan, Keenihan, Messina and Smith to participate in the Capital Raising.

4.3 Technical information required by Chapter 2E of the Corporations Act and Listing Rule 10.11

Pursuant to and in accordance with the requirements of section 219 of the Corporations Act and ASX Listing Rule 10.13, the following information is provided in relation to the proposed Participation:

(a) the related parties are Messrs Morgan, Keenihan and Messina (or their respective nominees) and they are related parties by virtue of being Directors of the Company;
(b) the party whom ASX has deemed to be a person whose relationship with the entity or a related party is, in ASX’s opinion such that shareholder approval should be obtained in accordance with ASX Listing Rule 10.11.5 is William Smith (or his nominee);
(c) the maximum number of Capital Raising Shares (being the nature of the financial benefit being provided) to be granted is 22,000,0000 Shares to be issued in the following amounts:
(i) 5,000,000 Capital Raising Shares to Charles Morgan (or his nominee/s), the subject of Resolution 4;
(ii) 10,000,000 Capital Raising Shares to Stephen Keenihan (or his nominee/s) the subject of Resolution 5;
(iii) 5,000,000 Capital Raising Shares to David Messina (or his nominee/s) the subject of Resolution 6; and
(iv) 2,000,000 Capital Raising Shares to William Smith (or his nominee/s) the subject of Resolution 7;
(d) the Shares will be issued to the Related Parties no later than 1 month after the date of the Meeting (or such later date as permitted by any ASX waiver or modification of the ASX Listing Rules) and it is anticipated the Capital Raising Shares will be issued on one date;
(e) the Shares issued will be fully paid ordinary shares in the capital of the Company issued on the same terms and conditions as the Company’s existing Shares;
(f) the issue price is $0.01 per Share, to raise $220,000;
(g) as announced by the Company on 18 December 2019, the funds raised from this issue were applied to the staged Acquisition of remaining assets at Wizard Lake future development activities and growth initiatives;
(h) the relevant interests of Messrs Morgan, Keenihan, Messina and Smith in the securities of the Company are set out below:

Related Party	Shares	Options
Charles Morgan	169,450,679	51,050,1471
Stephen Keenihan	86,749,999	38,052,6652
David Messina	39,112,000	77,000,0003
William Smith	nil	nil

Notes :

Comprised of the following classes of Options:
(a) 31,050,147 Listed Options exercisable at $0.01 each on or before 31 August 2020; and
(b) 20,000,000 Unlisted Options exercisable at $0.015 each on or before 31 May 2021.
Comprised of the following classes of Options:
(a) 10,052,665 Listed Options exercisable at $0.01 each on or before 31 August 2020; and
(b) 28,000,000 Unlisted Options exercisable at $0.015 each on or before 31 May 2021.

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Comprised of the following classes of Options:
- (a) 25,000,000 Listed Options exercisable at $0.01 each on or before 31 August 2020; and
- (b) 52,000,000 Unlisted Options exercisable at $0.015 each on or before 31 May 2021.
(i) the Board acknowledges the issue of Capital Raising Shares to Charles Morgan and Stephen Keenihan is contrary to Recommendation 8.3 of The Corporate Governance Principles and Recommendations with 2010 Amendments (2[nd] Edition) as published by The ASX Corporate Governance Council. However, the Board considers Messrs Morgan and Keenihan’s participation in the Capital Raising to be reasonable in the circumstances for the reason set out in paragraph (j);
(j) Charles Morgan declines to make a recommendation to Shareholders in relation to Resolution 4 due to his material personal interest in the outcome of the Resolution on the basis that Charles Morgan is to be permitted to subscribe for Capital Raising Shares in the Company should Resolution 4 be passed. However, in respect of Resolutions 5, 6 and 7, Charles Morgan recommends that Shareholders vote in favour of those Resolutions for the following reasons:
(i) the issue of Shares to the Directors will align the interests of the Directors with those of Shareholders;
(ii) participation of the Directors and William Smith under the Capital Raising is reasonable and on the same terms as other investors to the Capital Raising; and
(iii) it is not considered that there are any significant opportunity costs to the Company or benefits foregone by the Company in allowing the Directors and William Smith to participate under the Capital Raising on the terms proposed.
(k) Stephen Keenihan declines to make a recommendation to Shareholders in relation to Resolution 5 due to his material personal interest in the outcome of the Resolution on the basis that Stephen Keenihan is to be permitted to subscribe for Capital Raising Shares in the Company should Resolution 5 be passed. However, in respect of Resolutions 4, 6 and 7, Stephen Keenihan recommends that Shareholders vote in favour of those Resolutions for the reasons set out in paragraph (j);
(l) David Messina declines to make a recommendation to Shareholders in relation to Resolution 6 due to his material personal interest in the outcome of the Resolution on the basis that David Messina is to be permitted to subscribe for Capital Raising Shares in the Company should Resolution 6 be passed. However, in respect of Resolutions 4, 5 and 7, David Messina recommends that Shareholders vote in favour of those Resolutions for the reasons set out in paragraph (j);
(m) in forming their recommendations, each Director considered the experience of each other Related Party and the current market price of Shares, the current market practices when determining the number of Shares to be subscribed; and
(n) the Board is not aware of any other information that would be reasonably required by Shareholders to allow them to make a decision whether it is in the best interests of the Company to pass Resolutions 4 to 7.

Approval pursuant to ASX Listing Rule 7.1 is not required in order to issue the Capital Raising Shares to the Related Parties as approval is being obtained under ASX Listing Rule 10.11. Accordingly, the issue of Capital Raising Shares to the Related Parties will not be included in the 15% calculation of the Company’s annual placement capacity pursuant to ASX Listing Rule 7.1.

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5. RESOLUTIONS 8 TO 10 – ISSUE OF OPTIONS TO RELATED PARTIES – MESSR MORGAN, KEENIHAN AND MESSINA

5.1 General

The Company has agreed, subject to obtaining Shareholder approval, to issue a total of 80,000,000 Options ( Related Party Options ) to Messrs Morgan, Keenihan and Messina (or their respective nominees) ( Related Parties ) pursuant to the Share Option Plan adopted by Shareholders on 11 November 2019 and on the terms and conditions set out below.

5.2 Chapter 2E of the Corporations Act and ASX Listing Rule 10.11

For a public company, or an entity that the public company controls, to give a financial benefit to a related party of the public company, the public company or entity must:

(a) obtain the approval of the public company’s members in the manner set out in sections 217 to 227 of the Corporations Act; and
(b) give the benefit within 15 months following such approval,

unless the giving of the financial benefit falls within an exception set out in sections 210 to 216 of the Corporations Act.

The grant of the Related Party Options constitutes giving a financial benefit and Messrs Morgan, Keenihan and Messina (or their respective nominees) are related parties of the Company by virtue of being Directors.

ASX Listing Rule 10.14 also requires shareholder approval to be obtained where an entity issues, or agrees to issue, securities under an employee incentive scheme to a director of the entity, an associate of the director, or a person whose relationship with the entity, director or associate of the director is, in ASX’s opinion, such that approval should be obtained.

As it is proposed that all Directors be issued Related Party Options, as such, the Directors have been unable to form a quorum to consider whether one of the exceptions set out in sections 210 to 216 of the Corporations Act or ASX Listing Rule 10.15 applies to these issues. Accordingly, Shareholder approval is sought for the issue of Related Party Options to the Related Parties.

5.3 Shareholder Approval (Chapter 2E of the Corporations Act and Listing Rule 10.11)

Pursuant to and in accordance with the requirements of section 219 of the Corporations Act and ASX Listing Rule 10.15, the following information is provided in relation to the proposed grant of Related Party Options:

(a) the related parties are Messrs Morgan, Keenihan and Messina (or their respective nominees) and they are related parties by virtue of being Directors;
(b) the maximum number of Related Party Options (being the nature of the financial benefit being provided) to be granted is 80,000,000 Related Party Options to be issued in the following amounts:
(i) 20,000,000 Related Party Options to Charles Morgan (or his nominee/s), the subject of Resolution 8;
(ii) 20,000,000 Related Party Options to Stephen Keenihan (or his nominee/s) the subject of Resolution 9; and
(iii) 40,000,000 Related Party Options to David Messina (or his nominee/s) the subject of Resolution 10;
(c) the Share Option Plan was adopted by Shareholders on 11 November 2019. 25,000,000 Options have been issued under the Share Option Plan on 13 November 2019;
(d) any full or part time employee or director (being Messrs Morgan, Keenihan and Messina) of the Company is entitled to participate in the Share Option Plan, however, at the current time the Company does not intend to make an offer to any other employees. Accordingly, approval is being sought only for the offer to the Related Parties;
(e) the Related Party Options will be issued to the Related Parties within one (1) month of the date of the Meeting (or such later date as permitted by any ASX waiver or modification of the ASX Listing Rules) and it is anticipated the Related Party Options will be issued on the same date;

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(f) the terms of the Related Party Options are in accordance with the Share Option Plan, subject to the key terms and conditions of the Related Party Options summarised in Schedule 1;
(g) the Related Party Options will be granted for nil cash consideration, accordingly no funds will be raised;
(h) the value of the Related Party Options and the pricing methodology is set out in Schedule 2 – VALUATION OF RELATED PARTY OPTIONS
(i) details of any securities issued under the Share Option Plan will be published in the annual report of the Company relating to the period in which they were issued, along with a statement that approval for the issue was obtained under ASX Listing Rule 10.14;
(j) any additional person covered by ASX Listing Rule 10.14 who become entitled to participate in an issue of securities under the Share Option Plan after Resolutions 8 to 10 is approved and who were not named in the notice of meeting will not participate until approval is obtained under ASX Listing Rule 10.14;
(k) the relevant interests of the Related Parties in securities of the Company are set out below:

Related Party	Shares	Options
Charles Morgan	169,450,679	51,050,1471
Stephen Keenihan	86,749,999	38,052,6652
David Messina	39,112,000	77,000,0003

Notes :

Comprised of the following classes of Options:
(a) 31,050,147 Listed Options exercisable at $0.01 each on or before 31 August 2020; and (b) 20,000,000 Unlisted Options exercisable at $0.015 each on or before 31 May 2021.
1. Comprised of the following classes of Options:
2. (a) 10,052,665 Listed Options exercisable at $0.01 each on or before 31 August 2020; and
(b) 28,000,000 Unlisted Options exercisable at $0.015 each on or before 31 May 2021.
1. Comprised of the following classes of Options:
2. (a) 25,000,000 Listed Options exercisable at $0.01 each on or before 31 August 2020; and
3. (b) 52,000,000 Unlisted Options exercisable at $0.015 each on or before 31 May 2021.
(l) the remuneration and emoluments from the Company to the Related Parties for the previous financial year and the proposed remuneration and emoluments for the current financial year are set out below:

Related Party	Current Financial Year (FY20)	Previous Financial Year (FY19)
Charles Morgan	$75,000	$87,162
Stephen Keenihan	$150,000	$185,027
David Messina	$430,000	$528,936

Note : the above figures for FY19 are inclusive of share-based payments to each of the Directors which were $4,162, $5,827 and $62,076 in the case of Messrs Morgan, Keenihan and Messina, respectively.

(m) if the Related Party Options granted to the Related Parties are exercised, a total of 80,000,000 Shares would be issued. This will increase the number of Shares on issue from 3,217,583,037 to 3,297,583,037 (assuming that no other Options are exercised and no shares other than those contemplated by the Resolutions of this Notice are issued) with the effect that the shareholding of existing Shareholders would be diluted by an aggregate of 2.4% comprising 0.6% by Charles Morgan, 0.6% by Stephen Keenihan and 1.2% by David Messina.
(n) The market price for Shares during the term of the Related Party Options would normally determine whether or not the Related Party Options are exercised. If, at any time any of the Related Party Options are exercised and the Shares are trading on ASX at a price that is higher than the exercise price of the Related Party Options, there may be a perceived cost to the Company;

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(o) the trading history of the Shares on ASX in the 12 months before the date of this Notice is set out below:

	Price	Date
Highest	$0.0150	9 December 2019
Lowest	$0.0040	1 July 2019
Last	$0.012	13 January 2020

(p) the Board acknowledges the grant of Related Party Options to Charles Morgan and Stephen Keenihan is contrary to Recommendation 8.3 of The Corporate Governance Principles and Recommendations with 2010 Amendments (2[nd] Edition) as published by The ASX Corporate Governance Council. However, the Board considers the grant of Related Party Options to Charles Morgan and Stephen Keenihan reasonable in the circumstances for the reason set out in paragraph (j);
(q) the primary purpose of the grant of the Related Party Options to the Related Parties is to provide a performance linked incentive component in the remuneration package for the Related Parties to motivate and reward the performance of the Related Parties in their respective roles as Directors;
(r) Charles Morgan declines to make a recommendation to Shareholders in relation to Resolution 8 due to his material personal interest in the outcome of the Resolution on the basis that he is to be granted Related Party Options in the Company should Resolution 8 be passed. However, in respect of Resolutions 9 and 10, Charles Morgan recommends that Shareholders vote in favour of those Resolutions for the following reasons:
(i) the grant of Related Party Options to the Related Parties will align the interests of the Related Parties with those of Shareholders;
(ii) the grant of the Related Party Options is a reasonable and appropriate method to provide cost effective remuneration as the non-cash form of this benefit will allow the Company to spend a greater proportion of its cash reserves on its operations than it would if alternative cash forms of remuneration were given to the Related Parties; and
(iii) it is not considered that there are any significant opportunity costs to the Company or benefits foregone by the Company in granting the Related Party Options upon the terms proposed.
(s) Stephen Keenihan declines to make a recommendation to Shareholders in relation to Resolution 9 due to his material personal interest in the outcome of the Resolution on the basis that Stephen Keenihan is to be granted Related Party Options in the Company should Resolution 9 be passed. However, in respect of Resolutions 8 and 10, Stephen Keenihan recommends that Shareholders vote in favour of those Resolutions for the reasons set out in paragraph 5.3(i);
(t) David Messina declines to make a recommendation to Shareholders in relation to Resolution 10 due to his material personal interest in the outcome of the Resolution on the basis that David Messina is to be granted Related Party Options in the Company should Resolution 10 be passed. However, in respect of Resolutions 8 and 9, David Messina recommends that Shareholders vote in favour of those Resolutions for the reasons set out in paragraph (j);
(u) in forming their recommendations, each Director considered the experience of each other Related Party, the current market price of Shares, the current market practices when determining the number of Related Party Options to be granted as well as the exercise price and expiry date of those Related Party Options; and
(v) the Board is not aware of any other information that would be reasonably required by Shareholders to allow them to make a decision whether it is in the best interests of the Company to pass Resolutions 8 to 10.

Approval pursuant to ASX Listing Rule 7.1 is not required in order to issue the Related Party Options to the Related Parties as approval is being obtained under ASX Listing Rule 10.15. Accordingly, the issue of Related Party Options to the Related Parties will not be included in the 15% calculation of the Company’s annual placement capacity pursuant to ASX Listing Rule 7.1.

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6. RESOLUTION 11 – ISSUE OF SHARES TO RELATED PARTY – DAVID MESSINA

6.1 General

The Company has agreed, subject to obtaining Shareholder approval, to issue 4,000,000 Shares to David Messina ( Related Party Shares ) on the terms and conditions set out below.

The Related Party Shares form part of the remuneration payable to Mr Messina in connection with his engagement as Managing Director of the Company. Specifically, the Related Party Shares are being issued in lieu of a $44,000 cash performance bonus approved by the board and owing to Mr Messina under his executive services contract with the Company.

The number of Related Party Shares to be issued to Mr Messina in satisfaction of the cash amount owing has been calculated on the basis of the 10-day VWAP of the Company’s Shares immediately preceding the date of this Notice, which is $0.011. Accordingly, approval for the issue of 4,000,000 Related Party Shares is sought.

6.2 Chapter 2E of the Corporations Act

For a public company, or an entity that the public company controls, to give a financial benefit to a related party of the public company, the public company or entity must:

(a) obtain the approval of the public company’s members in the manner set out in sections 217 to 227 of the Corporations Act; and
(b) give the benefit within 15 months following such approval,

unless the giving of the financial benefit falls within an exception set out in sections 210 to 216 of the Corporations Act.

The grant of the Related Party Shares constitutes giving a financial benefit and Mr Messina is a related party of the Company by virtue of being a Director.

The Directors (other than Mr Messina who has a material personal interest in the Resolution) consider that Shareholder approval pursuant to Chapter 2E of the Corporations Act is not required in respect of the grant of Related Party Shares because the agreement to grant the Related Party Shares, which forms part of the remuneration package for Mr Messina, is considered reasonable remuneration in the circumstances and was negotiated on an arm’s length basis.

6.3 ASX Listing Rule 10.11

In addition, ASX Listing Rule 10.11 also requires shareholder approval to be obtained where an entity issues, or agrees to issue, securities to a related party, or a person whose relationship with the entity or a related party is, in ASX’s opinion, such that approval should be obtained unless an exception in ASX Listing Rule 10.12 applies.

As the grant of the Related Party Shares involves the issue of Shares to a related party of the Company, Shareholder approval pursuant to ASX Listing Rule 10.11 is required unless an exception applies. It is the view of the Directors that the exceptions set out in ASX Listing Rule 10.12 do not apply in the current circumstances.

6.4 Technical information required by ASX Listing Rule 10.13

Pursuant to and in accordance with ASX Listing Rule 10.13, the following information is provided in relation to this Resolution:

(a) the Related Party Shares will be issued to David Messina (or his nominee);
(b) Mr Messina is a related party of the Company by virtue of being a Director;
(c) the number of Related Party Shares to be issued is 4,000,000 Shares;
(d) the Related Party Shares will be granted no later than 1 month after the date of the Meeting (or such later date to the extent permitted by any ASX waiver or modification of the ASX Listing Rules) and it is intended that issue of the Shares will occur on the same date;

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(e) the Related Party Shares will be issued for nil cash consideration, in lieu of cash amounts owing to Mr Messina as directors fees and accordingly no funds will be raised;
(f) Mr Messina’s current remuneration package comprises:
(i) a director’s fee of $441,860 per annum (excluding superannuation); and
(ii) share based payments which, for the past financial year ended 30 June 2019, totalled $62,076.

Further, subject to Resolution 10 of this Notice being approved, Mr Messina will receive 40,000,000 Options under the Company’s Share Option Plan.

(g) the Shares issued will be fully paid ordinary shares in the capital of the Company issued on the same terms and conditions as the Company’s existing Shares.

Approval pursuant to ASX Listing Rule 7.1 is not required for the grant of the Related Party Shares as approval is being obtained under ASX Listing Rule 10.11. Accordingly, the grant of Related Party Shares to David Messina (or his nominee) will not be included in the use of the Company’s 15% annual placement capacity pursuant to ASX Listing Rule 7.1.

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GLOSSARY

$ means Australian dollars.

ASIC means the Australian Securities & Investments Commission.

Assets means the Salt Bush Assets and Point Loma Assets, which for the avoidance of doubt includes the Petroleum and Natural Gas Rights, tangible depreciable property, apparatus, plant and equipment and inventory of each of Salt Bush and Point Loma and the Miscellaneous Rights held by each of those parties.

ASX means ASX Limited (ACN 008 624 691) or the financial market operated by ASX Limited, as the context requires.

ASX Listing Rules means the Listing Rules of ASX.

Board means the current board of directors of the Company.

Business Day means Monday to Friday inclusive, except New Year’s Day, Good Friday, Easter Monday, Christmas Day, Boxing Day, and any other day that ASX declares is not a business day.

Chair means the chair of the Meeting.

Company means Whitebark Energy Limited (ACN 079 432 796).

Constitution means the Company’s constitution.

Corporations Act means the Corporations Act 2001 (Cth).

Directors means the current directors of the Company.

Explanatory Statement means the explanatory statement accompanying the Notice.

General Meeting or Meeting means the meeting convened by the Notice.

Miscellaneous Rights means the Vendor’s right, title and interest in and to all property and rights that pertain directly to the Petroleum and Natural Gas Rights or the Tangibles) including title and operating documents and other related contracts and agreements, surface rights, well bores and permits.

Notice or Notice of Meeting means this notice of meeting including the Explanatory Statement and the Proxy Form.

Option means an option to acquire a Share.

Optionholder means a holder of an Option or Related Party Option as the context requires.

Petroleum and Natural Gas Rights means each Vendor’s rights, title and interest in and to:

(a) rights in, or rights to drill for and to produce, save and market, Petroleum Substances;
(b) rights to a share of production of Petroleum Substances therefrom; and
(c) fee simple, royalty interests and similar interests in Petroleum Substances.

Petroleum Substances means crude oil, natural gas, natural gas liquids and other related hydrocarbons and all other substances related to any of the foregoing, whether liquid, solid or gaseous, and whether hydrocarbons or not, including sulphur and coalbed methane.

Point Loma Assets means the Point Loma Step 1 Assets and Point Loma Step 2 Assets, as those terms are defined in Section 1.2 of the Notice.

Proxy Form means the proxy form accompanying the Notice.

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Related Party Option means an Option granted pursuant to Resolutions 8 to 10 with the terms and conditions set out in Schedule 1.

Resolutions means the resolutions set out in the Notice, or any one of them, as the context requires.

Section means a section of the Explanatory Statement.

Share means a fully paid ordinary share in the capital of the Company.

Shareholder means a registered holder of a Share.

Vendor means Salt Bush, in relation to Salt Bush’s Assets and Point Loma, in relation to the Point Loma Assets.

Wizard Lake Payout Account means the tally of costs for facility construction and other things which Salt Bush has paid on behalf of Point Loma and for which Point Loma is repaying Salt Bush from the sale proceeds of production from the Rex 1 Well (being the 100/16-17-048-27W4/00 well).

WST means Western Standard Time as observed in Perth, Western Australia.

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SCHEDULE 1 – TERMS AND CONDITIONS OF RELATED PARTY OPTIONS

(a) Entitlement

Each Option entitles the holder to subscribe for one Share upon exercise of the Option.

(b) Exercise Price

Subject to paragraph (j), the amount payable upon exercise of each Option will be $0.016 (1.6 cents) ( Exercise Price ).

(c) Expiry Date

Each Option will expire at 5:00 pm (WST) on 2 January 2023 ( Expiry Date ). An Option not exercised before the Expiry Date will automatically lapse on the Expiry Date.

(d) Exercise Period

The Options will vest in equal tranches as follows:

(i) half will vest on issue; and
(ii) the remaining half will vest twelve (12) months from their date of issue,

and subject to clauses (d) and (e), the Options are exercisable at any time on or prior to the Expiry Date ( Exercise Period ).

(e) Cessation of Employment

Should the holder cease employment or engagement by the Company:

(i) any unexercised Options that have vested as at the date of cessation of employment or engagement with the Company ( Cessation Date ) shall lapse if the holder does not exercise the Option within a period of 1 month after the Cessation Date; and
(ii) any unexercised Options that have not vested as at the Cessation Date shall immediately lapse upon the Cessation Date.
(f) Notice of Exercise

The Options may be exercised during the Exercise Period by notice in writing to the Company in the manner specified on the Option certificate ( Notice of Exercise ) and payment of the Exercise Price for each Option being exercised in Australian currency by electronic funds transfer or other means of payment acceptable to the Company.

(g) Exercise Date

A Notice of Exercise is only effective on and from the later of the date of receipt of the Notice of Exercise and the date of receipt of the payment of the Exercise Price for each Option being exercised in cleared funds ( Exercise Date ).

(h) Timing of issue of Shares on exercise

Within five Business Days after the Exercise Date, the Company will:

(i) issue the number of Shares required under these terms and conditions in respect of the number of Options specified in the Notice of Exercise and for which cleared funds have been received by the Company;
(ii) if required, give ASX a notice that complies with section 708A(5)(e) of the Corporations Act, or, if the Company is unable to issue such a notice, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors; and
(iii) if admitted to the official list of ASX at the time, apply for official quotation on ASX of Shares issued pursuant to the exercise of the Options.

If a notice delivered under (h)(ii) for any reason is not effective to ensure that an offer for sale of the Shares does not require disclosure to investors, the Company must, no later than 20 Business Days after becoming aware of such notice being ineffective, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors.

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(i) Shares issued on exercise

Shares issued on exercise of the Options rank equally with the then issued shares of the Company.

(j) Reconstruction of capital

If at any time the issued capital of the Company is reconstructed, all rights of an Optionholder are to be changed in a manner consistent with the Corporations Act and the ASX Listing Rules at the time of the reconstruction.

(k) Participation in new issues

There are no participation rights or entitlements inherent in the Options and holders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the Options without exercising the Options.

(l) Change in exercise price

An Option does not confer the right to a change in Exercise Price or a change in the number of underlying securities over which the Option can be exercised.

(m) Transferability

The Options are transferable subject to any restriction or escrow arrangements imposed by ASX or under applicable Australian securities laws.

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SCHEDULE 2 – VALUATION OF RELATED PARTY OPTIONS

The Related Party Options to be issued to the Related Parties pursuant to Resolutions 8 to 10 have been valued by internal management .

Using the Black & Scholes option model model and based on the assumptions set out below, the Related Party Options were ascribed the following value:

Options were ascribed the following value:
Assumptions:

Valuation date	6 January 2020
Market price of Shares	1.2 cents
Exercise price	1.6 cents
Expiry date (length of time from issue)	2 January 2023
Risk free interest rate	0.78%
Volatility (discount)	100% being an expected future volatility of the company’s shares

Indicative value per Related Party Option	0.67 cents

Total Value of Related Party Options	$536,000

- Mr Charles Morgan	$134,000
- Mr David Messina	$268,000
- Mr Stephen Keenihan	$134,000

Note: The valuation noted above is not necessarily the market price that the Related Party Options could be traded at and is not automatically the market price for taxation purposes.

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Need assistance?

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Phone:

1300 850 505 (within Australia) +61 3 9415 4000 (outside Australia)

Online:

www.investorcentre.com/contact

WBE

MR SAM SAMPLE FLAT 123 123 SAMPLE STREET THE SAMPLE HILL SAMPLE ESTATE SAMPLEVILLE VIC 3030

YOUR VOTE IS IMPORTANT

For your proxy appointment to be effective it must be received by 8:30am (WST) Saturday, 22 February 2020.

Proxy Form

How to Vote on Items of Business

Lodge your Proxy Form:

XX

All your securities will be voted in accordance with your directions.

Online:

APPOINTMENT OF PROXY

Voting 100% of your holding: Direct your proxy how to vote by marking one of the boxes opposite each item of business. If you do not mark a box your proxy may vote or abstain as they choose (to the extent permitted by law). If you mark more than one box on an item your vote will be invalid on that item.

Voting a portion of your holding: Indicate a portion of your voting rights by inserting the percentage or number of securities you wish to vote in the For, Against or Abstain box or boxes. The sum of the votes cast must not exceed your voting entitlement or 100%.

Appointing a second proxy: You are entitled to appoint up to two proxies to attend the meeting and vote on a poll. If you appoint two proxies you must specify the percentage of votes or number of securities for each proxy, otherwise each proxy may exercise half of the votes. When appointing a second proxy write both names and the percentage of votes or number of securities for each in Step 1 overleaf.

Lodge your vote online at www.investorvote.com.au using your secure access information or use your mobile device to scan the personalised QR code.

Your secure access information is

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Control Number: 999999

SRN/HIN: I9999999999 PIN: 99999

For Intermediary Online subscribers (custodians) go to www.intermediaryonline.com

A proxy need not be a securityholder of the Company.

SIGNING INSTRUCTIONS FOR POSTAL FORMS

Individual: Where the holding is in one name, the securityholder must sign.

Joint Holding: Where the holding is in more than one name, all of the securityholders should sign.

Power of Attorney: If you have not already lodged the Power of Attorney with the registry, please attach a certified photocopy of the Power of Attorney to this form when you return it.

Companies: Where the company has a Sole Director who is also the Sole Company Secretary, this form must be signed by that person. If the company (pursuant to section 204A of the Corporations Act 2001) does not have a Company Secretary, a Sole Director can also sign alone. Otherwise this form must be signed by a Director jointly with either another Director or a Company Secretary. Please sign in the appropriate place to indicate the office held. Delete titles as applicable.

By Mail:

Computershare Investor Services Pty Limited GPO Box 242 Melbourne VIC 3001 Australia

By Fax:

1800 783 447 within Australia or +61 3 9473 2555 outside Australia

ATTENDING THE MEETING

If you are attending in person, please bring this form with you to assist registration.

Corporate Representative

PLEASE NOTE: For security reasons it is important that you keep your SRN/HIN confidential.

If a representative of a corporate securityholder or proxy is to attend the meeting you will need to provide the appropriate “Appointment of Corporate Representative” prior to admission. A form may be obtained from Computershare or online at www.investorcentre.com under the help tab, "Printable Forms".

Samples/000001/000001

MR SAM SAMPLE FLAT 123 123 SAMPLE STREET THE SAMPLE HILL SAMPLE ESTATE SAMPLEVILLE VIC 3030

I ND

Change of address. If incorrect, mark this box and make the correction in the space to the left. Securityholders sponsored by a broker (reference number commences with ‘ X ’) should advise your broker of any changes.



I 9999999999

Proxy Form

Please mark to indicate your directions

Step 1 Appoint a Proxy to Vote on Your Behalf

XX

I/We being a member/s of Whitebark Energy Limited hereby appoint

the Chairman OR of the Meeting

PLEASE NOTE: Leave this box blank if you have selected the Chairman of the Meeting. Do not insert your own name(s).

or failing the individual or body corporate named, or if no individual or body corporate is named, the Chairman of the Meeting, as my/our proxy to act generally at the meeting on my/our behalf and to vote in accordance with the following directions (or if no directions have been given, and to the extent permitted by law, as the proxy sees fit) at the General Meeting of Whitebark Energy Limited to be held at Level 2, 6 Thelma Street, West Perth, Western Australia on Monday, 24 February 2020 at 8:30am (WST) and at any adjournment or postponement of that meeting. Chairman authorised to exercise undirected proxies on remuneration related resolutions: Where I/we have appointed the Chairman of the Meeting as my/our proxy (or the Chairman becomes my/our proxy by default), I/we expressly authorise the Chairman to exercise my/our proxy on Resolutions 8 - 11 (except where I/we have indicated a different voting intention in step 2) even though Resolutions 8 - 11 are connected directly or indirectly with the remuneration of a member of key management personnel, which includes the Chairman.

Important Note: If the Chairman of the Meeting is (or becomes) your proxy you can direct the Chairman to vote for or against or abstain from voting on Resolutions 8 - 11 by marking the appropriate box in step 2.

Step 2 Items of Business

PLEASE NOTE: If you mark the Abstain box for an item, you are directing your proxy not to vote on your behalf on a show of hands or a poll and your votes will not be counted in computing the required majority.

For Against Abstain 1 Ratification of December Capital Raising Shares – ASX Listing Rule 7.1 2 Ratification of December Capital Raising Shares – ASX Listing Rule 7.1A 3 Issue of Consideration Shares to Point Loma Resources 4 Approval for Related Party to participate in December 2019 Capital Raising – Charles Morgan 5 Approval for Related Party to participate in December 2019 Capital Raising – Stephen Keenihan 6 Approval for Related Party to participate In December 2019 Capital Raising – David Messina	For Against Abstain	For Against Abstain	For Against Abstain	For Against Abstain	For Against Abstain	For Against Abstain	For Against Abstain
	7 Approval for William Smith to participate In December 2019 Capital Raising

	8 Issue of Options to Related Party – Charles Morgan

	9 Issue of Options to Related Party – Stephen Keenihan

	10 Issue of Options to Related Party – David Messina

	11 Issue of Shares to Related Party – David Messina

The Chairman of the Meeting intends to vote undirected proxies in favour of each item of business. In exceptional circumstances, the Chairman of the Meeting may change his/her voting intention on any resolution, in which case an ASX announcement will be made.

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Step 3 Signature of Securityholder(s) This section must be completed.
Individual or Securityholder 1 Securityholder 2 Securityholder 3
/ /
Sole Director & Sole Company Secretary Director Director/Company Secretary Date
Update your communication details (Optional) By providing your email address, you consent to receive future Notice
Mobile Number Email Address of Meeting & Proxy communications electronically
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