HILLGROVE RESOURCES LIMITED

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

THE MATTERS RAISED IN THIS DOCUMENT WILL AFFECT YOUR SHAREHOLDING IN THE COMPANY. YOU ARE ADVISED TO READ THIS DOCUMENT IN ITS ENTIRETY BEFORE THE EXTRAORDINARY GENERAL MEETING REFERRED TO BELOW IS CONVENED.

IF YOU ARE IN ANY DOUBT ABOUT THE ACTION YOU SHOULD TAKE, PLEASE CONSULT YOUR STOCKBROKER, SOLICITOR, ACCOUNTANT OR OTHER PROFESSIONAL ADVISER.

ABN 73 004 297 116

NOTICE OF EXTRAORDINARY GENERAL MEETING

AND

PART A: ABOUT THESE DOCUMENTS

Shareholders in Hillgrove Resources Limited ABN 73 004 297 116 ( Company ) are requested to consider each of the Resolutions set out in the Notice as well as the contents of all other Documents accompanying the Notice.

You can vote by:

attending and voting at the Meeting; or
appointing someone as your proxy to attend and vote at the Meeting on your behalf, by completing and returning the Proxy Form to the Company in the manner set out on the Proxy Form (see Part E of these Documents). The Company must receive your duly completed Proxy Form by no later than 11.00 am (AEST) on 21 August 2012.

A glossary of the key terms used throughout this document is contained in Part D of this Document.

Please read the whole of this Document carefully, determine how you wish to vote and then cast your vote accordingly, either in person or by proxy.

HILLGROVE RESOURCES LIMITED

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PART B: NOTICE OF EXTRAORDINARY GENERAL MEETING

NOTICE is hereby given that an extraordinary general meeting of members of Hillgrove Resources Limited ABN 73 004 297 116 will be held at Level 41 Australia Square, 264 George Street, Sydney NSW 2000 on 23 August 2012 at 11.00 am (AEST).

Definitions: Unless expressly provided otherwise, each capitalised term used in this Notice has the same meaning as is ascribed to it in Part D of the Documents.

BUSINESS

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

That, for the purpose of Listing Rule 7.4 and for all other purposes, shareholders ratify the issue of 119,054,786 fully paid ordinary shares by the Company on or about 19 July 2012 to persons who are sophisticated or professional investors for the purpose of section 708 of the Corporations Act 2001(Cth) ( Institutional Investors ) under an unconditional placement at a price of $0.085 per Share ( Unconditional Placement ), as further set out in the Explanatory Notes accompanying this Notice.

(First Resolution)

Voting Exclusion Statement: The Company will disregard any votes cast on this resolution by any person who participated in the Unconditional Placement and any associates of those persons. However, the Company will not disregard a vote if it is cast by a person as proxy for a person who is entitled to vote, in accordance with the direction on the proxy form, or it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides. The Chairman intends to vote undirected proxies provided to him in favour of this First Resolution.

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

That, for the purpose of Listing Rule 7.1 and for all other purposes, approval be given for the issue of 57,415,803 fully paid ordinary shares in the Company to Institutional Investors under a conditional placement at a price of $0.085 per share ( Conditional Placement ), as further set out in the Explanatory Notes accompanying this Notice.

(Second Resolution)

Voting Exclusion Statement : The Company will disregard any votes cast on this resolution by any person who may participate in the proposed issue of Shares to the Conditional Placement investors and any associates of those persons. However, the Company will not disregard a vote if it is cast by a person as proxy for a person who is entitled to vote, in accordance with the direction on the proxy form, or it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides. The Chairman intends to vote undirected proxies provided to him in favour of this Second Resolution.

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

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That, for the purpose of Listing Rule 10.11 and for all other purposes, approval be given to issue 117,647 fully paid ordinary shares in the Company to John Edwin Gooding, a Director of the Company, under the Conditional Placement at a price of $0.085 per Share, as further set out in the Explanatory Notes accompanying this Notice.

(Third Resolution)

Voting Exclusion Statemen t: The Company will disregard any votes cast on this resolution by John Edwin Gooding or any of his associates. However, the Company will not disregard a vote if it is cast by a person as proxy for a person who is entitled to vote, in accordance with the direction on the proxy form, or it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides. The Chairman intends to vote undirected proxies provided to him in favour of this Third Resolution.

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

That, for the purpose of Listing Rule 10.11 and for all other purposes, approval be given to issue 1,176,471 fully paid ordinary shares in the Company to Drew Anthony Simonsen, the Managing Director of the Company, under the Conditional Placement at a price of $0.085 per Share, as further set out in the Explanatory Notes accompanying this Notice.

(Fourth Resolution)

Voting Exclusion Statement: The Company will disregard any votes cast on this resolution by Drew Anthony Simonsen or any of his associates. However, the Company will not disregard a vote if it is cast by a person as proxy for a person who is entitled to vote, in accordance with the direction on the proxy form, or it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides. The Chairman intends to vote undirected proxies provided to him in favour of this Fourth Resolution.

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

That, for the purpose of Listing Rule 10.11 and for all other purposes, approval be given to issue 176,471 fully paid ordinary shares in the Company to Dean Craig Brown, the Chairman of the Company, under the Conditional Placement at a price of $0.085 per Share, as further set out in the Explanatory Notes accompanying this Notice.

(Fifth Resolution)

Voting Exclusion Statement: The Company will disregard any votes cast on this resolution by Dean Craig Brown or any of his associates. However, the Company will not disregard a vote if it is cast by a person as proxy for a person who is entitled to vote, in accordance with the direction on the proxy form, or it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides. The Chairman intends to vote undirected proxies provided to him in favour of this Fifth Resolution.

By order of the Board

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Russell Middleton Company Secretary

HILLGROVE RESOURCES LIMITED

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PART C: NOTICE REQUIREMENTS FOR RESOLUTIONS

EXPLANATORY NOTES

The purpose of these Explanatory Notes is to provide shareholders with information to assist them in assessing the merits of the resolutions contained in the accompanying Notice of Extraordinary General Meeting of Hillgrove Resources Limited ( Hillgrove or Company ).

The Directors recommend that shareholders read these Explanatory Notes in full before making any decision in relation to the resolution.

A. Background to applicable Listing Rules and provisions of the Corporations Act

Listing Rule 7.1

Listing Rule 7.1, known as the "15% rule", limits the capacity of a company to issue securities without the approval of its shareholders. In broad terms, that Listing Rule provides that a company may not, in a twelve month period, issue securities equal to more than 15% of the total number of ordinary securities on issue at the beginning of the twelve month period unless the issue is approved by shareholders or otherwise comes within one of the exceptions to Listing Rule 7.1 set out in Listing Rule 7.2.

Listing Rule 7.4

Listing Rule 7.4 states that an issue of securities made without approval under Listing Rule 7.1 is treated as having been made with approval for the purpose of listing rule 7.1, if that issue did not otherwise breach listing rule 7.1 and the holders of the entity’s ordinary securities subsequently approve the issue.

Listing Rule 10.11

Listing Rule 10.11 requires shareholder approval by ordinary resolution for the issue of equity securities to a related party, and a person whose relationship with the company or a related party is, in the ASX's opinion, such that approval should be obtained, unless one of the exceptions in Listing Rule 10.12 applies. Under the Listing Rules, a related party includes a director or a controlling entity of a company. As set out in exception 14 under Listing Rule 7.2, if approval is given under Listing Rule 10.11, approval is not needed under Listing Rule 7.1.

B. Commentary on each Resolution

The Resolutions proposed relate to the capital raising recently conducted by the Company, details of which were announced by the Company on 13 July 2012 ( Capital Raising ). The Capital Raising comprises:

(a) a placement of Shares ( Unconditional Placement );
(b) subject to Shareholders’ approval, a conditional placement of Shares ( Conditional Placement ); and
(c) a Share Purchase Plan.

Under the Unconditional Placement and Conditional Placement, Wilson HTM Corporate Finance Ltd is acting as Global Lead Manager and Sole Bookrunner, and Casimir Capital L.P. is acting as Joint Placement Agent North America.

The Share Purchase Plan is an offer to shareholders to apply for up to A$15,000 in Shares, the full terms and conditions of which were announced to the market on 19 July 2012.

HILLGROVE RESOURCES LIMITED

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FIRST RESOLUTION – RATIFICATION OF UNCONDITIONAL PLACEMENT

On 19 July 2012, the Company issued 119,054,786 shares at a price of $0.085 per Share to Institutional Investors under the Unconditional Placement. The proceeds from the Unconditional Placement will be used to supplement the Company’s existing cash resources to ensure it has access to the necessary working capital to optimise mining operations at the Company’s Kanmantoo mine in South Australia, and for general corporate purposes. The results and details of the Unconditional Placement were included in the announcement to the ASX on 13 July 2012.

Shareholder approval was not required prior to the issue of the shares under the Unconditional Placement but is being sought now for the purposes of Listing Rule 7.4, the effect of which will be to ratify the issue of the shares for the purposes of Listing Rule 7.1. Under Listing Rule 7.4, once the First Resolution has been passed in accordance with its terms, the issue of the Shares will be treated as having been made with approval for the purposes of Listing Rule 7.1.

If Shareholder approval is obtained under the First Resolution the Shares will be excluded from the calculation of the Company's issuance capacity under the 15% limit contained in Listing Rule 7.1. This will provide the Company with flexibility during the next 12 month period to issue further equity securities without being required to seek further Shareholder approval.

In accordance with the requirements of Listing Rule 7.5, the Company provides the following information:

119,054,786 Shares were issued on 19 July 2012;
the issue price of the Shares is A$0.085 per Share;
the allotees of the Shares were various Institutional Investors; and
the Shares will be issued on the same terms as, and will rank equally with, all other Shares, from the time of issue; and
the funds raised by the Unconditional Placement will be used to supplement the Company’s existing cash resources to ensure it has access to the necessary working capital to optimise mining operations at the Company’s Kanmantoo mine in South Australia, and for general corporate purposes.

The Board unanimously recommends that Shareholders vote in favour of the approval of the First Resolution.

Voting Exclusion Statement: The voting exclusion statement has been included with the Resolution in Part B of this Notice.

SECOND RESOLUTION – CONDITIONAL PLACEMENT

It is proposed that the Company will issue 57,415,803 Shares under the Conditional Placement to Institutional Investors at an issue price of $0.085 per Share.

Approval is sought for the proposed issue of Shares to Institutional Investors under the Conditional Placement in the Second Resolution to permit the Company to issue those Shares without breaching the 15% limit which applies to the Company under Listing Rule 7.1 and to preserve the Company's capacity to issue further Shares within this 15% limit in a 12 month period without the prior approval of Shareholders.

If the Second Resolution is not passed the Shares the subject of the Conditional Placement will not be issued and the funding to be raised under the Conditional Placement will not be received by the Company. In these circumstances, the Company will need to explore alternative sources of funding.

HILLGROVE RESOURCES LIMITED

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In accordance with Listing Rule 7.3, the Company provides the following information:

(a) the maximum number of Shares that the Company will issue under the Conditional Placement is 57,415,803;
(b) the date by which the Company will issue the Shares under the Conditional Placement is expected to be 29 August 2012 but, in any event, no later than one month after the date of the Meeting;
(c) the issue price for the Shares to be issued under the Conditional Placement is $0.085 per Share;
(d) the Shares will be issued to the Conditional Placement investors, being various Institutional Investors;
(e) the Shares will be issued on the same terms as, and will rank equally with, all other Shares, from the time of issue; and
(f) the Company will apply the net proceeds from the Conditional Placement to supplement the Company’s existing cash resources to ensure it has access to the necessary working capital to optimise mining operations at the Company’s Kanmantoo mine in South Australia, and for general corporate purposes.

The Board unanimously recommends that Shareholders vote in favour of the approval of the Second Resolution.

Voting Exclusion Statement: The voting exclusion statement has been included with the Resolution in Part B of this Notice.

THIRD, FOURTH AND FIFTH RESOLUTIONS – APPROVAL TO ISSUE SHARES TO JOHN GOODING, DREW SIMONSEN AND DEAN CRAIG BROWN

Shareholder approval is being sought pursuant to Listing Rule 10.11 for the issue of Shares under the Conditional Placement to John Gooding (a Director of the Company), Drew Simonsen (the Managing Director of the Company) and Dean Craig Brown (the Chairman of the Company). This will enable each of John Gooding, Drew Simonsen and Dean Craig Brown to participate in the Conditional Placement.

If Shareholder approval of the Third, Fourth and Fifth Resolutions is not obtained, then each of John Gooding, Drew Simonsen and Dean Craig Brown will not be issued any Shares under the Conditional Placement, and the aggregate subscription proceeds of approximately $125,000 will not be received by the Company.

For the purposes of Listing Rule 10.13 the Company provides the following information:

(a) the maximum number of Shares that the Company will issue under the Conditional Placement to:
John Edwin Gooding is 117,647;
Drew Anthony Simonsen is 1,176,471; and
Dean Craig Brown is 176,471,

being in aggregate, a maximum of 1,470,589 Shares.

(b) the date by which the Company will issue the Shares under the Conditional Placement to each of John Edwin Gooding, Drew Anthony Simonsen and Dean Craig Brown is expected to be 29 August 2012 but, in any event, no later than three months after the date of the Meeting;

HILLGROVE RESOURCES LIMITED

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(c) the issue price for the Shares to be issued is $0.085 per Share;
(d) the Shares will be issued on the same terms as, and will rank equally with, all other Shares, from the time of issue;
(e) the Company will apply the net proceeds raised from issuing Shares to each of John Gooding, Drew Simonsen and Dean Craig Brown to supplement the Company’s existing cash resources to ensure it has access to the necessary working capital to optimise mining operations at the Company’s Kanmantoo mine in South Australia, and for general corporate purposes; and
(f) Shareholder approval is being sought under Listing Rule 10.11 and, as such, approval is not required under Listing Rule 7.1.

Voting Exclusion Statement: The voting exclusion statement has been included with the Resolution in Part B of this Notice.

HILLGROVE RESOURCES LIMITED

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PART D: GLOSSARY OF TERMS

associate has the meaning ascribed to that term in section 12 of the Corporations Act.

ASX means the ASX Limited ACN 008 624 691.

Board means the board of Directors.

Capital Raising means the capital raising comprising of the Unconditional Placement, the Conditional Placement and the Share Purchase Plan, details of which were announced by the Company on 13 July 2012.

Company means Hillgrove Resources Limited ACN 004 297 116.

Conditional Placement has the meaning given to it in Part B of these Documents.

Constitution means the constitution of the Company, as amended from time to time.

Corporations Act means Corporations Act 2001 (Cth).

Director means a member of the board of directors of the Company.

Documents means each of the Notice, the Explanatory Notes, the Proxy Form and any or all other documents that each constitute part of this booklet.

Explanatory Notes means the explanatory notes set out in Part C of these Documents.

Institutional Investors means persons who are sophisticated or professional investors for the purpose of section 708 of the Corporations Act.

Listing Rules means the rules and procedures issued and enforced by the ASX, as amended from time to time, including all appendices and guidance notes thereto.

Meeting means the extraordinary general meeting being convened by the Directors and pursuant to the Notice.

Notice means the Notice of Extraordinary General Meeting of Shareholders that accompanies and forms part of these Documents and all disclosures made in these Documents in accordance with the requirements of the Listing Rules and the Corporations Act.

Proxy Form means the proxy form more particularly set out in Section 5 and forms part of these Documents.

Resolution means any one of the resolutions set out in the Notice.

Securities has the meaning given to it in the Listing Rules.

Share means a fully paid ordinary share in the Company.

Shareholder means the holder of a Share.

Unconditional Placement has the meaning given to it in Part B of these Documents.

HILLGROVE RESOURCES LIMITED

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PART E: PROXIES AND PROXY FORMS

(a) Right to appoint : Each member entitled to vote at the meeting has the right to appoint a proxy to attend and vote for the member at the meeting. To appoint a proxy, use the Proxy Form sent out with this Notice.
(b) A proxy or attorney is not entitled to vote while the member appointing them is present at the meeting.
(c) Who may be a proxy : A member can appoint anyone to be their proxy. A proxy need not be a member of the Company. The proxy appointed can be described in the Proxy Form by an office held eg "Chair of the Meeting".
(d) Two proxies : A member who is entitled to two (2) or more votes at the meeting, may appoint 2 proxies. Where two (2) proxies are appointed:
(i) a separate Proxy Form should be used to appoint each proxy; and
(ii) the Proxy Form may specify the proportion, or the number, of votes that each proxy may exercise, and if it does not do so each proxy may exercise half of the votes.
(e) Signature(s) of individuals : In the case of members who are individuals, the Proxy Form must be signed if the shares are held:
(i) by one person, by that member; or
(ii) in joint names, by any one of them.
(f) Signatures on behalf of companies : In the case of members which are companies, the Proxy Form must be signed:
(i) if it has a sole director who is also sole secretary, by that director (and stating that fact next to or under the signature on the Proxy Form); or
(ii) in the case of any other company, by two (2) directors or by a director and secretary.

The use of the common seal of the company on the Proxy Form is optional.

(g) Lodgement place and deadline : Proxy forms must be received by the Company with the original or a certified copy of the authority under which the Proxy Form is signed (if the Proxy Form is signed by an attorney or other representative):
at the offices of the Company, Level 41 Australia Square, 264-278 George Street, Sydney NSW; or
by facsimile on 02 8221 0407.

by no later than 11.00 am (AEST) on 21 August 2012 .

CORPORATE REPRESENTATIVES

A body corporate may appoint an individual to act as its representative to exercise any of the powers the body may exercise at meetings of a company's members. Unless otherwise stated, the corporate representative may exercise all of the powers the appointing body can exercise. The certificate evidencing the appointment of a corporate representative (or a photocopy or facsimile of it) must be received by the Company at Level 41 Australia Square, 264-278 George Street, Sydney NSW or by facsimile on 02 8221 0407, by no later than 11.00 am (Sydney time) on 21 August 2012.

MEMBERS WHO ARE ENTITLED TO VOTE

In accordance with Corporations Regulations 7.11.37, the directors have determined that a person's entitlement to vote at the meeting will be the entitlement of that person set out in the registrar of members as at 7.00 pm (AEST) on 21 August 2012.

HILLGROVE RESOURCES LIMITED

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Hillgrove Resources Limited

ABN 73 004 297 116

PROXY FORM

Reference Number: XXXXXXXXXX

Appoints

(Proxy name or office held by Proxy - please print)

or failing that person, or if no person is named, the Chair of the Meeting to vote as directed below, or if no directions are given, as the Proxy or Chairman thinks fit (with discretion as to any business not referred to below) at the Extraordinary General Meeting of the Company to be held at Level 41 Australia Square, 264-278 George Street, Sydney NSW on 23 August 2012 at 11:00 am and at any adjournment of that meeting.

IMPORTANT FOR MOTIONS BELOW

If the Chairman of the Meeting is to be your proxy and you have not directed your proxy to vote on any of the motions below, please place a mark in the adjacent box

By marking this box you acknowledge that the Chairman of the Meeting may exercise your proxy even if he has an interest in the outcome of a motion and that votes cast by him, other than as a proxy holder, would be disregarded because of that interest. If you do not mark this box, and you have not directed your proxy how to vote, the Chairman of the Meeting will not cast your votes on any motion and your votes will not be counted in computing the required majority if a poll is called on a motion.

The Chairman of the Meeting will vote all undirected proxies in favour of each motion.

Resolution:

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For Against Abstain
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Ratifying the issue of 119,054,786 Shares to institutional investors under an Unconditional Placement
Approving the issue of 57,415,803 Shares to institutional investors under a Conditional Placement
Approving the issue of 117,647 Shares to John Gooding, a Director of the Company, under the Conditional Placement
Approving the issue of 1,176,471 Shares to Drew Simonsen, the Managing Director of the Company, under the Conditional Placement
Approving the issue of 176,471 Shares to Dean Craig Brown, the Chairman of the Company, under the Conditional Placement

Appointment of a second proxy

If appointing a second proxy, state the number or percentage of votes applicable to the proxy appointed by this form.

Date: 2012

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Individual or Shareholder 1 Shareholder 2 Shareholder 3
Individual or Sole Director/
Director Director/Company Secretary
Company Secretary
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Contact Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Daytime Telephone . . . . . . . . . .. . . . . . . . . . . .

Date / /2012

AI assistant

HILLGROVE RESOURCES LIMITED Proxy Solicitation & Information Statement 2012

65051_rns_2012-07-23_efcc493e-6125-4059-aacd-c21bd8ae3e1d.pdf

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION