PAINCHEK LTD — Capital/Financing Update 2015

Aug 11, 2015

Appendix 3B New issue announcement

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

**Appendix

3B**

**New

issue
announcement, application
for
quotation
of
additional
securities and
agreement**

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX’s property and may be made public.

Introduced 01/07/96 Origin: Appendix 5 Amended 01/07/98, 01/09/99, 01/07/00, 30/09/01, 11/03/02, 01/01/03, 24/10/05, 01/08/12, 04/03/13

Name of entity

MinQuest Limited

ABN

21 146 035 127

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

1 +Class of+securities issued or to be issued 2 Number of+securities issued or to be issued (if known) or maximum number which may be issued	Fully paid ordinary shares
	(a) 37,407,597 fully paid ordinary shares (b) 1,539,634 fully paid ordinary shares (c) 2,309,451 fully paid ordinary shares (d) 679,688 fully paid ordinary shares (e) 1,696,756 unlisted options (f) A convertible note with a face value of US$174,000

+ See chapter 19 for defined terms.

Appendix 3B Page 1

04/03/2013

Appendix 3B New issue announcement

3 Principal terms of the+securities (e.g. if options, exercise price and expiry date; if partly paid +securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)

(a) 37,407,597 fully paid ordinary shares (b) 1,539,634 fully paid ordinary shares (c) 2,309,451 fully paid ordinary shares (d) 679,688 fully paid ordinary shares issued pursuant to the conversion of a US$10,000 convertible note issued on 11 August 2015. (e) 1,696,756 unlisted share options with an exercise price of $0.10 and an expiry date of 11 August 2018. Each option is convertible into one fully paid ordinary share when exercised. (f) A convertible note with a face value of US$174,000 that may be converted into fully paid ordinary shares at the lower of 85% of the 5 day VWAP or $0.05 per share on or before 10 August 2017. Based on the AUD:USD exchange rate as at 7 August 2015 and the 5 day VWAP of the Company’s shares as at 7 August 2015, conversion of the convertible note in full would have resulted in the issue of 9,942,117 fully paid ordinary shares by the Company.

+ See chapter 19 for defined terms.

Appendix 3B Page 2

04/03/2013

Appendix 3B New issue announcement

4 Do the+securities rank equally in all respects from the+issue date with an existing+class of quoted+securities? If the additional+securities do not rank equally, please state: • the date from which they do • the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment • the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration 6 Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets)	(a),(b), (c) and (d) Yes (e) Shares acquired pursuant to the exercise of options will rank equally with fully paid ordinary shares (f) Shares acquired pursuant to the conversion of convertible notes will rank equally with fully paid ordinary shares
	(a) $0.025 per share (b) and (c) $0.03366 per share (d) $0.01989 per share (e) $Nil (f) Convertible note with a face value of US$174,000
	Funds raised pursuant to the issues of shares per (a) and (d) and the convertible note per (f) will be utilised to finance the Company’s due diligence and other costs in relation to the proposed acquisition of the assets of Yukon Zinc Corporation, to advance the Company’s exploration projects, and for working capital purposes. (b) Shares issued to Pacific Ridge Exploration Limited pursuant to an agreement to earn up to a 70% ownership interest in the Fyre Lake Project in Canada. (c) Shares issued to Golden Predator Limited pursuant to an agreement to earn up to a 75% ownership interest in The Marg Project in Canada. (e) Commitment Options issued to Magna Equities II LLC pursuant to the drawdown of funds under Tranche A of the convertible note facility.

+ See chapter 19 for defined terms.

Appendix 3B Page 3

04/03/2013

Appendix 3B New issue announcement

6a Is the entity an+eligible entity that has obtained security holder approval under rule 7.1A? If Yes, complete sections 6b – 6h in relation to the+securities the subject of this Appendix 3B, and comply with section 6i 6b The date the security holder resolution under rule 7.1A was passed 6c Number of +securities issued without security holder approval under rule 7.1 6d Number of+securities issued with security holder approval under rule 7.1A 6e Number of+securities issued with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting) 6f Number of+securities issued under an exception in rule 7.2 6g If+securities issued under rule 7.1A, was issue price at least 75% of 15 day VWAP as calculated under rule 7.1A.3? Include the +issue date and both values. Include the source of the VWAP calculation. 6h If+securities were issued under rule 7.1A for non-cash consideration, state date on which valuation of consideration was released to ASX Market Announcements 6i Calculate the entity’s remaining issue capacity under rule 7.1 and rule 7.1A – complete Annexure 1 and release to ASX Market Announcements 7 +Issue dates Note: The issue date may be prescribed by ASX (refer to the definition of issue date in rule 19.12). For example, the issue date for a pro rata entitlement issue must comply with the applicable timetable in Appendix 7A. Cross reference: item 33 of Appendix 3B.	Yes
	11 May 2015
	(e) 1,696,756 options (f) Convertible note with a face value of US$174,000, convertible into 9,942,117 ordinary shares based on the AUD:USD exchange rate as at 7 August 2015 and the 5 day VWAP of the Company’s shares as at 7 August 2015.
	Nil
	(a), (b), (c) and (d) 41,256,683 fully paid shares issued pursuant to resolutions approved at an extraordinary general meeting shareholders on 11 May 2015.
	Nil
	N/a
	N/a
	LR7.1 2,730,878 LR7.1A 4,125,668
	11 August 2015

+ See chapter 19 for defined terms.

Appendix 3B Page 4

04/03/2013

Appendix 3B New issue announcement

• 8 Number and[+] class of all[+] securities quoted on ASX (including the[+] securities in section 2 if applicable)

Number + Class 200,230,115 Fully paid ordinary shares

• 9 Number and[+] class of all[+] securities not quoted on ASX (including the + securities in section 2 if applicable)

Number

+Class

7,000,000 50,316,669 7,923,067 6,000,000 1,696,756 1

Share options with an exercise price of $0.20 per share expiring 31/08/2015 Share options with an exercise price of $0.045 per share expiring 11/05/2017 Share options with an exercise price of $0.045 per share expiring 11/02/2017 Share options with an exercise price of $0.045 per share expiring 23/07/2017 Share options with an exercise price of $0.10 per share expiring 10 August 2018. Convertible note with a face value of US$174,000 and an expiry date of 10 August 2017 that may be converted into equity securities at a conversion price that is the lesser of (a) the 5dasy VWAP prior to the issue of a conversion notice or (b) A$0.05 per share.

• 10 Dividend policy (in the case of a All fully paid ordinary shares rank equally in relation to trust, distribution policy) on the dividends. increased capital (interests)

Part 2 - Pro rata issue

• 11 Is security holder approval required? N/a 12 Is the issue renounceable or nonN/a renounceable?

+ See chapter 19 for defined terms.

Appendix 3B Page 5

04/03/2013

Appendix 3B New issue announcement

13 Ratio in which the+securities will be offered 14 +Class of+securities to which the offer relates 15 +Record date to determine entitlements 16 Will holdings on different registers (or subregisters) be aggregated for calculating entitlements? 17 Policy for deciding entitlements in relation to fractions 18 Names of countries in which the entity has security holders who will not be sent new offer documents Note: Security holders must be told how their entitlements are to be dealt with. Cross reference: rule 7.7. 19 Closing date for receipt of acceptances or renunciations 20 Names of any underwriters 21 Amount of any underwriting fee or commission 22 Names of any brokers to the issue 23 Fee or commission payable to the broker to the issue 24 Amount of any handling fee payable to brokers who lodge acceptances or renunciations on behalf of security holders 25 If the issue is contingent on security holders’ approval, the date of the meeting 26 Date entitlement and acceptance form and offer documents will be sent to persons entitled	N/a
	N/a
	N/a
	N/a
	N/a
	N/a
	N/a
	N/a
	N/a
	N/a
	N/a
	N/a
	N/a
	N/a

+ See chapter 19 for defined terms.

Appendix 3B Page 6

04/03/2013

Appendix 3B New issue announcement

27 If the entity has issued options, and the terms entitle option holders to participate on exercise, the date on which notices will be sent to option holders 28 Date rights trading will begin (if applicable) 29 Date rights trading will end (if applicable) 30 How do security holders sell their entitlements in full through a broker? 31 How do security holders sell part of their entitlements through a broker and accept for the balance? 32 How do security holders dispose of their entitlements (except by sale through a broker)? 33 +Issue date	N/a
	N/a
	N/a
	N/a
	N/a
	N/a
	N/a

Part 3 - Quotation of securities

You need only complete this section if you are applying for quotation of securities

34 Type of[+] securities (tick one) (a) + Securities described in Part 1 (b)[All other ][+] [securities ]

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

35 If the[+] securities are[+] equity securities, the names of the 20 largest holders of the additional[+] securities, and the number and percentage of additional[+] securities held by those holders

+ See chapter 19 for defined terms.

Appendix 3B Page 7

04/03/2013

Appendix 3B New issue announcement

36 If the[+] securities are[+] equity securities, a distribution schedule of the additional[+] securities setting out the number of holders in the categories 1 - 1,000 1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,001 and over 37 A copy of any trust deed for the additional[+] securities

Entities that have ticked box 34(b)

38 Number of +securities for which +quotation is sought 39 +Class of +securities for which quotation is sought 40 Do the+securities rank equally in all respects from the+issue date with an existing+class of quoted+securities? If the additional+securities do not rank equally, please state: • the date from which they do • the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment • the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 41 Reason for request for quotation now Example: In the case of restricted securities, end of restriction period (if issued upon conversion of another +security, clearly identify that other +security) 42 Number and+class of all+securities quoted on ASX (including the +securities in clause 38)	N/a
	N/a
	N/a
	N/a
	Number	+Class
	N/a	N/a

+ See chapter 19 for defined terms.

Appendix 3B Page 8

04/03/2013

Appendix 3B New issue announcement

Quotation agreement

• 1 + Quotation of our additional + securities is in ASX’s absolute discretion. ASX may quote the[+] securities on any conditions it decides.

• 2 We warrant the following to ASX.

• The issue of the[+] securities to be quoted complies with the law and is not for an illegal purpose.

• There is no reason why those[+] securities should not be granted[+] quotation.

• An offer of the[+] securities for sale within 12 months after their issue will not require disclosure under section 707(3) or section 1012C(6) of the Corporations Act.

  • Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any[+] securities to be quoted and that no-one has any right to return any[+] securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the +securities be quoted.

• If we are a trust, we warrant that no person has the right to return the + securities to be quoted under section 1019B of the Corporations Act at the time that we request that the[+] securities be quoted.

• 3 We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.

• 4 We give ASX the information and documents required by this form. If any information or document is not available now, we will give it to ASX before[+] quotation of the[+] securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

Sign here:

==> picture [119 x 42] intentionally omitted <==

Date: 12 August 2015

Company secretary Print name: Stephen Kelly

== == == == ==

+ See chapter 19 for defined terms.

Appendix 3B Page 9

04/03/2013

Appendix 3B New issue announcement

Appendix 3B – Annexure 1

Calculation of placement capacity under rule 7.1 and rule 7.1A for eligible entities

Introduced 01/08/12 Amended 04/03/13

Part 1

Rule 7.1 – Issues exceeding 15% of capital

Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

Part 1	Part 1
Rule 7.1 – Issues exceeding 15% of capital
Step 1: Calculate “A”, the base figure from which the placement capacity is calculated
Insertnumber of fully paid+ordinary securities on issue 12 months before the +issue date or date of agreement to issue	33,095,001
Addthe following: • Number of fully paid+ordinary securities issued in that 12 month period under an exception in rule 7.2 • Number of fully paid+ordinary securities issued in that 12 month period with shareholder approval • Number of partly paid+ordinary securities that became fully paid in that 12 month period Note: • Include only ordinary securities here – other classes of equity securities cannot be added • Include here (if applicable) the securities the subject of the Appendix 3B to which this form is annexed • It may be useful to set out issues of securities on different dates as separate line items	22,500,000 140,305,427 NIL
Subtractthe number of fully paid+ordinary securities cancelled during that 12 month period	Nil
“A”	195,900,428

+ See chapter 19 for defined terms.

Appendix 3B Page 10

04/03/2013

Appendix 3B New issue announcement

Step 2: Calculate 15% of “A”
“B”	0.15 [Note: this value cannot be changed]
Multiply“A” by 0.15	29,385,064
Step 3: Calculate “C”, the amount of placement capacity under rule 7.1 that has already been used
Insertnumber of+equity securities issued or agreed to be issued in that 12 month period_not counting_those issued: • Under an exception in rule 7.2 • Under rule 7.1A • With security holder approval under rule 7.1 or rule 7.4 Note: • This applies to equity securities, unless specifically excluded – not just ordinary securities • Include here (if applicable) the securities the subject of the Appendix 3B to which this form is annexed • It may be useful to set out issues of securities on different dates as separate line items	20/7/15 Fully paid ordinary shares 3,650,000 20/7/15 Unlisted share options 3,650,000 24/7/15 Fully paid ordinary shares 7,035,625 11/8/15 Issue of convertible note 9,942,117 11/8/15 Fully paid ordinary shares 679,688 11/8/15 Unlisted share options 1,696,756
“C”	26,654,186
Step 4: Subtract “C” from [“A” x “B”] to calculate remaining placement capacity under rule 7.1
“A” x 0.15 Note: number must be same as shown in Step 2	29,385,064
Subtract“C” Note: number must be same as shown in Step 3	26,654,186
Total[“A” x 0.15] – “C”	2,730,878 [Note: this is the remaining placement capacity under rule 7.1]

+ See chapter 19 for defined terms.

Appendix 3B Page 11

04/03/2013

Appendix 3B New issue announcement

Part 2

Rule 7.1A – Additional placement capacity for eligible entities

Part 2	Part 2
Rule 7.1A – Additional placement capacity for eligible entities
Step 1: Calculate “A”, the base figure from which the placement capacity is calculated
“A” Note: number must be same as shown in Step 1 of Part 1	195,900,428
Step 2: Calculate 10% of “A”
“D”	0.10 Note: this value cannot be changed
Multiply“A” by 0.10	19,590,043
Step 3: Calculate “E”, the amount of placement capacity under rule 7.1A that has already been used
Insertnumber of+equity securities issued or agreed to be issued in that 12 month period under rule 7.1A Notes: • This applies to equity securities – not just ordinary securities • Include here – if applicable – the securities the subject of the Appendix 3B to which this form is annexed • Do not include equity securities issued under rule 7.1 (they must be dealt with in Part 1), or for which specific security holder approval has been obtained • It may be useful to set out issues of securities on different dates as separate line items	15,464,375
“E”	15,464,375

+ See chapter 19 for defined terms.

Appendix 3B Page 12

04/03/2013

Appendix 3B New issue announcement

Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A
“A” x 0.10 Note: number must be same as shown in Step 2	19,590,043
Subtract“E” Note: number must be same as shown in Step 3	15,464,375
Total[“A” x 0.10] – “E”	4,125,668 Note: this is the remaining placement capacity under rule 7.1A

+ See chapter 19 for defined terms.

Appendix 3B Page 13

04/03/2013