PAINCHEK LTD — Capital/Financing Update 2016

Oct 17, 2016

TERMS OF UNDERWRITER OPTIONS

The Options entitle the holder (Option holder) to subscribe for Shares on the following terms and conditions:

• (a) Each Option gives the Option holder the right to subscribe for one Share.

• (b) The Options will expire at 5.00 pm (AEST) on the date that is three years after their issue date (Expiry Date). Any Option not exercised before the Expiry Date will automatically lapse on the Expiry Date.

• (c) The amount payable upon exercise of each Option will be equal one hundred and twenty five percent (125%) of the price at which Shares are issued pursuant to the Capital Raising (Exercise Price).

• (d) The Options held by each Option holder may be exercised in whole or in part, and if exercised in part, a minimum of 1,000 Options must be exercised on each occasion.

• (e) An Option holder may exercise their Options by lodging with the Company, before the Expiry Date:

• (i) a written notice of exercise of Options specifying the number of Options being exercised; and

• (ii) a cheque or electronic funds transfer for the Exercise Price for the number of Options being exercised;

Exercise Notice).

• (f) An Exercise Notice is only effective when the Company has received the full amount of the Exercise Price in cleared funds.

• (g) Within 10 Business Days of receipt of the Exercise Notice accompanied by payment of the Exercise Price, the Company will allot the number of Shares required under these terms and conditions in respect of the number of Options specified in the Exercise Notice.

• (h) The Options are freely transferrable.

• (i) All Shares allotted upon the exercise of Options will upon allotment rank pari passu in all respects with other Shares.

• (j) The Options will not be listed.

• (k) If at any time the issued capital of the Company is reconstructed, all rights of an Option holder are to be changed in a manner consistent with the Corporations Act and the Listing Rules at the time of the reconstruction.

• (l) There are no participating rights or entitlements inherent in the Options and the Option holders will not be entitled to participate in new issues of capital offered to Shareholders without exercising the Option. The Company will ensure that for the purposes of determining entitlements to any such issue, the record date will be at least 5 Business Days after the issue is announced. This will give Option holders the opportunity to exercise their Options prior to the date for determining entitlements to participate in any such issue.

• (m) Subject to paragraph (l), 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.