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PRODIGY GOLD NL Proxy Solicitation & Information Statement 2006

Jun 22, 2006

65615_rns_2006-06-22_f752fff4-2195-471e-866a-afb88648fb71.pdf

Proxy Solicitation & Information Statement

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TANTALUM AUSTRALIA NL

ABN 58 009 127 020

NOTICE OF GENERAL MEETING

TIME: 10.00am
DATE: Monday 31 July 2006
PLACE: BDO, Level 8, 256 St Georges Terrace Perth, Western Australia

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 vofing.

Should you wish to discuss the matters in this Notice of Meeting please do not hesitate to contact the Company Secretary on (08) 6241 1888.

CONTENTS

1. Notice of General Meeting (setting out the proposed resolutions)
$\overline{2}$ . Explanatory Statement (explaining the proposed resolutions)
1. Glossary
Proxy Form $\overline{4}$ .

TIME AND PLACE OF MEETING AND HOW TO VOTE

VENUE

The General Meeting of the Shareholders of Tantalum Australia NL will be held at 10.00am WST on 31 July 2006 at:

BDO, Level 8, 256 St Georges Terrace Perth, Western Australia

YOUR VOTE IS IMPORTANT

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

VOTING IN PERSON

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

VOTING BY PROXY

To vote by proxy, please complete and sign the proxy form enclosed and either:

$(a)$ deliver the proxy form to the Company's registered office at 24 Mumford Place, Balcatta, Western Australia 6021; or
$(b)$ by facsimile to the Company on facsimile number (61 8) 6241 1811; or
deliver the proxy form to the Company's share reaistry, Security Transfer $|C|$ Registrars Pty Ltd. 770 Canning Highway, Applecross, Western Australia 6153,

so that it is received not later than 10.00am WST on 29 July 2006. Proxy forms received later than this time will be invalid.

Your proxy form is enclosed after the Explanatory Statement.

NOTICE OF GENERAL MEETING

Notice is given that a General Meeting of Shareholders of Tantalum Australia NL will be held at BDO, Level 8, 256 St Georges Terrace, Perth, Western Australia at 10.00am (WST) on 31 July 2006.

The Explanatory Statement to this Notice of Meeting provides additional information on matters to be considered at the General Meeting. The Explanatory Statement and the proxy form are part of this Notice of Meeting.

The Directors have determined pursuant to Reaulation 7.11.37 of the Corporations Requiations 2001 (Cth) that the persons eligible to vote at the General Meeting are those who are reaistered Shareholders of the Company at 5.00pm on 29 July 2006.

Terms and abbreviations used in this Notice of Meeting and Explanatory Statement are defined in the Glossary.

AGENDA

$\mathbf{1}$ . RESOLUTION 1 - ADOPTION OF EMPLOYEE SHARE PLAN

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 7.2 (Exception 9) and for all other purposes, approval is given for the Directors to adopt and implement the "Tantalum Australia NL Employee Share Plan" (Plan) in accordance with the terms and conditions of the Plan, a summary of which is set out in the Explanatory Statement."

Short Explanation: The Plan is designed to be an incentive to key people who assist in the successful development and operation of the Company. Approval is sought pursuant to ASX Listing Rule 7.2 (Exception 9) so that Shares issued pursuant to the Plan are not included in the Company's 15% capacity for the purposes of ASX Listing Rule 7.1. Please refer to the Explanatory Statement for further details.

Voting Exclusion: The Company will disregard any votes cast on this Resolution by the Executive Directors of the Company and any of their associates.

$2.$ RESOLUTION 2 - RATIFICATION OF ISSUE OF SECURITIES TO EMPLOYEES

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 allotment of 5,800,000 Shares to employees of the Company on the terms and conditions set out in the Explanatory Statement."

Short Explanation: The Company seeks Shareholder ratification of the issue of Shares under ASX Listing Rule 7.4 in order to retain the Company's capacity to issue up to 15% of its issued ordinary capital, if required, in the next 12 months without Shareholder approval. Please refer to the Explanatory Statement for further details.

Voting Exclusion: The Company will disregard any votes cast on this Resolution by a person who participated in the issue and any associates of those persons.

$\overline{3}$ . RESOLUTION 3 - RATIFICATION OF SHARE PLACEMENT

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 placement of 10,000,000 Shares on the terms and conditions set out in the Explanatory Statement."

Short Explanation: The Company seeks Shareholder ratification of the issue of Shares under ASX Listing Rule 7.4 in order to retain the Company's capacity to issue up to 15% of its issued ordinary capital, if required, in the next 12 months without Shareholder approval. Please refer to the Explanatory Statement for further details.

Voting Exclusion: The Company will disregard any votes cast on this Resolution by a person who participated in the issue and any associates of those persons.

4. RESOLUTION 4 - RATIFICATION OF SHARE PLACEMENT

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 allotment of 30,000,000 Shares on the terms and conditions set out in the Explanatory Statement."

Short Explanation: The Company seeks Shareholder ratification of the issue of Shares under ASX Listing Rule 7.4 in order to retain the Company's capacity to issue up to 15% of its issued ordinary capital, if required, in the next 12 months without Shareholder approval. Please refer to the Explanatory Statement for further details.

Voting Exclusion: The Company will disregard any votes cast on this Resolution by a person who participated in the issue and any associates of those persons.

$\overline{\mathbf{5}}$ . RESOLUTION 5 - ISSUE OF SHARES TO MR IMANTS KINS

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

"That, subject to the passing of Resolution 1, for the purposes of Section 208 of the Corporations Act, ASX Listing Rule 10.14 and for all other purposes, approval is given for the Directors to issue up to 6,500,000 Shares to Mr Imants Kins (or his nominee) on the terms and conditions set out in the Explanatory Statement."

Short Explanation: The Corporations Act and ASX Listing Rules require the Company to seek shareholder approval prior to the issue of securities to a related party under an employee incentive scheme. Mr Kins is a related party of the Company by virtue of the fact that he is a Director.

As set out in more detail in the Explanatory Statement, the Shares will be issued subject to the Plan, which prevents transfer of some of the Shares until certain performance and employment continuity criteria have been met.

Voting Exclusion: The Company will disregard any votes cast on this Resolution by Mr Kins or any of his associates.

RESOLUTION 6 - APPROVAL OF TERMINATION BENEFITS 6.

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 10.19, Section 200B of the Corporations Act, and for all other purposes, Shareholders approve the terms of Clause 10 of the proposed employment agreement between the Company and Mr Imants Kins, a Director of the Company (Employment Aareement)."

Short Explanation: The ASX Listing Rules and the Corporations Act require a company to obtain shareholder approval for giving, or agreeing to give, certain termination benefits to directors of the company. Clause 10 of the Employment Agreement provides for payments to be made and other benefits to be given to Mr Kins upon the termination of the Employment Agreement in certain circumstances. Accordinaly, the Company seeks Shareholder approval pursuant to Resolution 6 for the inclusion of Clause 10 in the Employment Agreement. If Resolution 6 is passed, it will not be necessary for the Company to obtain Shareholder approval for the termination benefits at the time of termination. Please refer to the Explanatory Statement for further details.

Voting Exclusion: The Company will disregard any votes cast on this resolution by Mr Kins or any of his associates.

$\overline{z}$ RESOLUTION 7 - CHANGE OF COMPANY NAME

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 157(1) of the Corporations Act, and for all other purposes, the name of the Company be changed to "ABM Resources NI""

Short Explanation: The Company proposed to change its name to more accurately reflect the proposed future activities of the Company.

DATED: This 19th day of June 2006

BY ORDER OF THE BOARD

TIMOTHY KING COMPANY SECRETARY

Voting Exclusion Note:

Where a voting exclusion applies, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote in accordance with the directions 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.

EXPLANATORY STATEMENT

This Explanatory Statement has been prepared for the information of the Shareholders of the Company in connection with the business to be conducted at the General Meeting to be held at BDO. Level 8, 256 St Georges Terrace, Perth, Western Australia on 31 July 2006 at 10.00am (WST).

This purpose of this Explanatory Statement is to provide information which the Directors believe to be material to Shareholders in deciding whether or not to pass the Resolutions in the Notice of Meetina.

$\mathbf{1}$ . RESOLUTION 1 - ADOPTION OF EMPLOYEE SHARE PLAN

$1.1$ Background

ASX Listing Rule 7.1 requires a listed company to obtain shareholder approval prior to the issue of shares, or securities convertible into shares, representing more than 15% of the issued capital of that company in any rolling 12 month period.

An exception to ASX Listing Rule 7.1 is set out in ASX Listing Rule 7.2 (Exception 9) which provides that issues under an employee incentive plan are exempt for a period of 3 years from the date on which shareholders approve the issue of securities under the plan as an exception to ASX Listing Rule 7.1.

Resolution 1 seeks Shareholder approval for the adoption of the "Tantalum Australia NL Employee Share Plan" (subject to the passing of Resolution 7, to be renamed the "ABM Resources NL Employee Share Plan")(Plan) to allow the issue of Shares under the Plan as an exception to ASX Listina Rule 7.1 in accordance with ASX Listing Rule 7.2 (Exception 9).

The Company announced the adoption of the Plan on 17 November 2005 and the terms of the Plan were released on ASX on this date. Shareholders should note however that the Directors have subsequently resolved to amend the Plan to allow Executive Directors (and their associated bodies corporate) to participate in the Plan, and that it is this amended version of the Plan which is now put forward for Shareholder approval under Resolution 1. There have been no other amendments to the original Plan.

The Plan is designed to provide employees with an ownership interest in the Company and to provide additional incentives for employees to increase profitability and returns to Shareholders.

Shareholders should note that 2,600,000 Shares were issued under the Plan on 17 November 2005 and 3,200,000 Shares were issued under the Plan on 5 April 2006. As these issues occurred prior to the Company obtaining Shareholder approval for the adoption of the Plan, this issue does not fall within ASX Listing Rule 7.2 (Exception 9). Ratification of this issue of Shares is being sought pursuant to Resolution 2.

Please refer to the ASX company announcement dated 17 November 2005 for the full terms and conditions of the Plan. Alternatively, the full terms and conditions of the Plan may be obtained free of charge by contacting the Company. A summary of the terms and conditions of the Plan is set out below.

Terms of Plan $1.2$

$(a)$ Introduction

The Plan is designed to provide full-time and part-time employees and executive Directors (but not non-executive Directors) of the Company (Eligible Employees) with an ownership interest in the Company and to provide additional incentives to increase profitability and returns to Shareholders. The Plan also offers financial support for employees of the Company to acquire the Shares pursuant to the Plan, at the discretion of the Directors.

$(b)$ Acaulsition of Shares

The Directors may invite Eligible Employees to acquire Shares under the Plan at their discretion. The Shares issued under the Plan will be fully paid ordinary shares in the capital of the Company, and will rank equally with other issued Shares. Subject to the restriction on the transfer of Plan Shares outlined below, Plan Shares will be the subject of applications for auotation on ASX as soon as practicable after the Plan Shares are allotted.

$\left( c\right)$ Issue Price of Plan Shares

The issue price of each Plan Share will be determined by the Directors at or before the time of the invitation to acquire Shares under the Plan. The issue price of the Plan Shares is payable in full by the Eligible Employee on the date of issue of the Plan Shares.

Where the Shares are issued for cash consideration, the Directors may, at their absolute discretion, determine that the whole or part of the issue price will be advanced by the Company to the Eligible Employee, who must apply the advance in payment of the issue price.

Restriction on Transfer of Plan Shares $(d)$

A participant in the Plan must not sell, transfer, assign, mortgage, charge or otherwise encumber a Share issued under the Plan until the later of the following (to the extent applicable):

the repayment in full of any loan advanced by the Company to $\mathbf{ii}$ the participant contemporaneously with the issue of Shares under the Plan:
$(ii)$ the expiry of any service continuity period specified by the Company at the time of issue of the Shares; and
$(iii)$ the satisfaction of any performance criteria specified by the Company at the time of issue of the Shares.

The Directors may impose different time period and performance criteria in relation to different persons, and the Directors will have the absolute discretion to determine whether any such time period or criteria has been satisfied in relation to any Share issued under the Plan, or to waive that period or criteria in relation to that Share.

If an Eligible Employee ceases to be an Eligible Employee of the Company during the period of restriction, or the above criteria are not satisfied by the Eligible Employee, the Company may buy-back the Plan Shares the subject of the restriction under Part 2J.1 of the Corporations Act at a price equal to:

where the Shares were issued for no cash consideration - the $\mathbf{ii}$ lesser of \$0,0001 each or the market price of the Shares; or

where the Shares were issued for cash consideration - the $(ii)$ market price of the Shares.

$(e)$ Eligible Employees

Permanent full-time and part-time employees, contractors and subcontractors determined by the Board to be included within the definition of "Eligible Employee" for the purposes of the Plan, and executive Directors (but not non-executive Directors) of the Company or an associated body corporate are eligible to participate in the Plan.

$(f)$ Limit on Plan Shares

The aggregate number of Shares in respect of which invitations may be made under the Plan by the Directors on any date, when added to the number of Shares already issued under the Plan during the 5 years preceding the date on which invitations are made, must not exceed 5% of the total number of Shares on issue in the capital of the Company.

$(a)$ Powers of the Board of Directors

The Plan is administered by the Directors of the Company, who have the power to:

$\Pi$ determine procedures for the administration of the Plan;
$(ii)$ amend or waive the terms and conditions of the Plan; and
$(iii)$ suspend or terminate the Plan.

$(h)$ Structure of the Loan

Where the Directors determine that the whole or part of the issue price of Plan Shares will be advanced by the Company to the Eliaible Employee, that advance must be applied in payment to the Company of the issue price.

During the term of any such loan, dividends paid in respect of the Plan Shares in relation to which the Company made the loan will be retained by the Company as interest paid by the borrower on the loan.

The borrower must repay the loan to the Company on the earlier of 5 years from the date of allotment of the Plan Shares to which the loan relates, or the date the borrower ceases to be employed by the Company.

If a borrower is required to sell their Plan Shares and settle the loan, and the proceeds of the sale of the Plan Shares do not cover the outstanding loan balance, the Company will meet the loss on the loan. This means that the loan will effectively be linked to the value of the Shares.

$2.$ RESOLUTION 2 - RATIFICATION OF ISSUE OF SECURITIES TO EMPLOYEES

$2.1$ General

On 17 November 2005 and 5 April 2006 the Company announced issues of 2,600,000 Shares and 3,200,000 Shares to four key employees of the Company pursuant to the Plan. As these Shares were issued prior to the Company obtaining Shareholder approval for the adoption of the Plan, the issues do not fall within ASX Listing Rule 7.2 (Exception 9). Accordingly, Resolution 2 seeks Shareholder ratification pursuant to ASX Listing Rule 7.4 for the issue of those Shares (Ratification).

By obtaining the Ratification, the Company will retain the flexibility to issue equity securities in the future up to the 15% threshold set out in ASX Listing Rule 7.1 without the requirement to obtain prior Shareholder approval.

4,000,000 of the Shares were issued subject to the restrictions on transfer contained in Section 7 of the Plan (summarised in Section 1.2 of this Explanatory Statement) in relation to performance conditions and employment continuity conditions as follows:

Number of Shares	Performance Condition Period End Date	Employment Condition Period End Date
1,100,000	30 June 2006	30 June 2006
500,000	30 September 2006	30 September 2006
1,000,000	30 June 2007	30 June 2007
1,000,000	30 June 2008	30 June 2008
400,000	30 June 2009	30 June 2009

$2.2$ Technical information required by ASX Listing Rule 7.5

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

$(a)$ 5,800,000 Shares were allotted and issued to the persons set out below (the Eligible Employees) as follows:

Name	Number of Shares
Peter Heydon	2,000,000
Alan Still	2,000,000
Barry Rees	1,200,000
Jutta Zimmermann	600,000

$(b)$ 2,600,000 Shares were allotted and issued on 17 November 2005 and 3,200,000 Shares were allotted and issued on 5 April 2006;
the Shares were issued free as consideration for performance of work $\left( c\right)$ both previously and into the future, by the Eligible Employees, and to secure their ongoing commitment to the continued growth of the Company;
$(d)$ the Shares issued were fully paid ordinary shares in the capital of the Company;
$(e)$ the Shares rank equally with the Company's current issued securities, subject to the restrictions on transfer set out in Section 2.1 above:
$(f)$ none of the Eligible Employees were related parties of the Company: and
no funds were raised from the issue of the Shares. $(q)$

$\overline{\mathbf{3}}$ RESOLUTIONS 3 AND 4 - RATIFICATION OF SHARE PLACEMENTS.

$3.1$ Backaround

Resolutions 3 and 4 respectively seek Shareholder approval for:

the placement of 10,000,000 Shares at 5.5 cents per Share to a New York $(a)$ institutional investor to raise \$550,000; and
$(b)$ the placement of 30,000,000 Shares at 5 cents per Share, via a leading Australian broking house, to the allottees set out in Schedule 1 to this Explanatory Statement (Allottees) to raise \$1,500,000,

(together, the Placements).

The Company announced the completion of the Placements on ASX on 12 April 2006.

By approving the Placements, the Company will retain the flexibility to issue equity securities in the future up to the 15% threshold set out in ASX Listing Rule 7.1 without the requirement to obtain prior Shareholder approval.

$3.2$ Technical information required by ASX Listing Rule 7.5

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

$(a)$ 40,000,000 Shares were allotted and issued as follows:
$\prod$ 10,000,000 Shares were allotted and issued to a Caymandomiciled fund managed by a major New York institution; and
30,000,000 Shares were allotted and issued to the Allottees set $(ii)$ out in Schedule 1 to this Explanatory Statement;
the Shares were allotted and issued on 12 April 2006; $(b)$
$\left( c\right)$ the Shares were allotted at the following issue prices:
10,000,000 Shares at an issue price of 5.5 cents per Share; and $\Pi$
30,000,000 Shares at an issue price of 5 cents per Share; $(ii)$
$(d)$ the Shares issued were fully paid ordinary shares in the capital of the Company and rank equally with the Company's current issued shares;
the funds raised from the Placements will be and have been used: $(e)$
to accelerate the exploration program at the Company's $\prod$ indicative VMS base metals prospect located at Erayinia in Western Australia^.
$(ii)$ to accelerate the exploration program at the Company's uranium prospect in the Gascovne in Western Australia:
$(iii)$ to advance the acquisition by the Company of other base metal and uranium opportunities; and
for general working capital. $(iv)$

$\Delta$ RESOLUTION 5 - ISSUE OF SHARES TO MR IMANTS KINS

$4.1$ Backaround

Resolution 5 seeks Shareholder approval for the issue of the following Shares to Mr Imants Kins, the Managing Director of the Company, pursuant to the Plan:

2,000,000 Shares immediately upon the receipt of Shareholder approval; $(a)$
$(b)$ 1,500,000 Shares immediately, but which shall be subject to the restrictions on transfer contained in clause 7 of the Plan and summarised in Section 1.2(d) of this Explanatory Statement (Plan Restrictions) until:
$\left{ i\right}$ completion of Mr Kins' continuity of service to the Company to 30 September 2006; and
$\left{ii\right}$ satisfaction by Mr Kins of the performance criteria, being the factors relevant to determining whether significant value has been or will be added for Shareholders, including Share price movement, project acquisition on reasonable terms, project development, profitability, capital raising to fund operations, broker support, retention of key staff and corporate governance (together, the Performance Criteria) for the 2006 financial year to the satisfaction of the Directors;
$(c)$ 1,500,000 Shares immediately, but which shall be subject to the Plan Restrictions until:
completion of Mr Kins' continuity of service to the Company $\mathbf{ii}$ until 30 September 2007; and
satisfaction by Mr Kins of the Performance Criteria for the 2007 $(ii)$ financial year to the satisfaction of the Directors; and
1,500,000 Shares immediately, but which shall be subject to the Plan $(d)$ Restrictions until:
completion of Mr Kins' continuity of service to the Company $\mathbf{I}$ until 30 September 2008; and
satisfaction by Mr Kins of the Performance Criteria for the 2008 $\overline{(\overline{\mathbf{H}})}$ financial year to the satisfaction of the Directors.

The Shares are to be issued as part of Mr Kins' remuneration package, and to secure the ongoing commitment of Mr Kins to the continued growth of the Company. The Shares will be issued subject to the terms and conditions of the Plan (as adopted by Resolution 1).

Shareholder approval for the issue of the Shares to Mr Kins is required pursuant to Chapter 2E of the Corporations Act and ASX Listing Rule 10.14.

$4.2$ Chapter 2E of the Corporations Act

Chapter 2E of the Corporations Act regulates the provision of financial benefits to related parties by a public company. Section 208 of the Corporations Act prohibits a public company giving a financial benefit to a related party unless one of a number of exceptions applies.

A "financial benefit" is defined in the Corporations Act in broad terms and includes a public company issuing securities.

For the purposes of this meeting, a "related party" includes a director of the Company. Accordinaly, the proposed issue of Shares to Mr Kins involves the provision of a financial benefit to a related party of the Company.

It is the view of the Directors that the exceptions under the Corporations Act to the provision of financial benefits to related parties may not apply in the current Accordingly, the Directors have determined to seek circumstances. Shareholder approval for the purposes of Chapter 2E of the Corporations Act for the issue of the Shares to Mr Kins.

$4.3$ Technical Information Required by Section 217 to 227 of the Corporations Act

In accordance with the requirements of Sections 217 to 227 of the Corporations Act, the following information is provided to enable Shareholders to assess the proposed issue of the Shares to Mr Kins:

$(a)$ the related party to whom the financial benefit will be given is Mr Imants Kins, the Managing Director of the Company:
the maximum number of Shares (being the nature of the financial $(b)$ benefit being provided) to be issued to Mr Kins is 6,500,000;
no funds will be raised from the issue of the Shares: $(C)$
$(d)$ the Shares will be issued free as a cost-effective form of consideration for performance of work both previously, from the commencement of Mr Kins' contract with the Company (1 October 2005) and into the future, and to secure the ongoing commitment of Mr Kins to the continued growth of the Company;
in determining the number of Shares to be issued to Mr Kins, $(e)$ consideration was given to the relevant experience and role of Mr Kins. his overall remuneration terms, the current market price of Shares and the terms of share packages granted to directors of other companies within the mineral exploration and gold production sectors;
$(f)$ the Shares will be fully paid ordinary shares in the capital of the Company and, subject to the restrictions on transfer contained in Section 7 of the Plan (summarised in Section 1.2(d) above) and the satisfaction of service continuity and performance criteria set out in Section 4.1 above, the Shares will rank equally with all of the Shares of the Company currently on issue;
as at the date of this Notice, the annual remuneration (inclusive of $(a)$ superannuation) payable to Mr Kins is \$161,000 per annum;
$(h)$ during the previous financial year the Company paid consulting fees of \$84,000 to Tewal Pty Ltd, a company associated with Mr Kins;

$\left{ i\right}$ as at the date of this Notice, Mr Kins has notifiable interests in the securities of the Company as set out below:

Shares	Options
2,973,000	Ni

if Shareholders approve the issue of Shares to Mr Kins, the effect will be $\left($ il to dilute the shareholding of existing Shareholders by approximately 1.41% on an undiluted basis (based on 453,094,730 Shares being currently on issue);
in the 12 months preceding the date of this Notice, the highest, lowest $(k)$ and last trading price of Shares on ASX are as set out below:

Highest	8.7 cents on 6 March 2006
Lowest	1.3 cents on 29 June 2005
l mst	5.0 cents on 19 June 2006

$\left{ \left\vert {}\right\rangle \right}$ the value of the Shares to be issued to Mr Kins is \$325,000 based on:
the assumption that all of the Performance Criteria and $\prod$ continuity of service requirements are met by Mr Kins; and
$(ii)$ a share price of 5.0 cents per Share (being the most recent trading price of Shares on ASX); and
$(m)$ Mr Kins declines to make a recommendation to Shareholders in relation to Resolution 5 due to his material personal interest in the outcome of the Resolution. The independent Directors recommend that Shareholders vote in favour of Resolution 5 as they are of the view that the issue of Shares to Mr Kins is an appropriate form of remuneration to provide him with an incentive to maximise returns to Shareholders. The Directors are not aware of any other information that would be reasonably reaujred by Shareholders to allow them to make a decision whether it is in the best interests of the Company to pass Resolution 5.

4.4 ASX Listing Rule 10.14

ASX Listing Rule 10.14 provides that a company must not permit any of the following persons to acquire securities under an employee incentive scheme without the approval of holders of ordinary securities of the acquisition:

a director of the company; $(a)$
$(b)$ an associate of a director; or
a person whose relationship with the company or a person referred to in $\mathcal{L}$ (a) or (b) above is, in ASX's opinion, such that approval should be obtained.

If Resolution 5 is passed, Shares will be issued to Mr Kins, who is the Managing Director of the Company.

Approval pursuant to ASX Listing Rule 7.1 is not required in order to issue the Shares as approval is being obtained under ASX Listing Rule 10.14 and Exception 9(b) of ASX Listing Rule 7.2. The issue of Shares to Mr Kins will not be included in the 15% calculation for the purposes of ASX Listing Rule 7.1.

$4.5$ Technical Information Required by ASX Listing Rule 10.15A

A notice of meeting to obtain approval under ASX Listing Rule 10.14 must comply with either ASX Listing Rule 10.15 or 10.15A. The information required to be provided for the purposes of approval under ASX Listing Rule 10.14 is set out below, in accordance with ASX Listing Rule 10.15A:

permanent full-time and part-time employees, contractors and sub- $(a)$ contractors determined by the Board to be included as an employee for the purposes of the Plan, and executive Directors of the Company for an associated body corporate) are eligible to participate in the Plan. The only person referred to in ASX Listing Rule 10.14 who is eligible to participate in the Plan as at the date of this Notice is Mr Imants Kins:
$(b)$ the maximum number of Shares to be issued to Mr Kins is 6,500,000 Shares (on the terms set out in Section 4.1 above):
the Shares will be issued free as consideration for performance of work $\left( \bigcirc \right)$ from the commencement of Mr Kins' contract with the Company (1) October 2005), and to secure the ongoing commitment of Mr Kins to the confinued growth of the Company. In determining the number of Shares to be issued to Mr Kins, consideration was aiven to the relevant experience and role of Mr Kins, his overall remuneration terms, the current market price of Shares and the terms of Share packages granted to directors of other companies within the mineral exploration and gold production sectors;
$(d)$ the Shares to be issued to Mr Kins are fully paid ordinary shares in the capital of the Company, and, subject to the restrictions on transfer contained in Section 7 of the Plan and the satisfaction of service continuity and performance criteria set out in Section 4.1 above, the Shares will rank equally with all of the Shares of the Company currently on issue;
$(e)$ no persons referred to in ASX Listing Rule 10.14 have previously received Shares under the Plan:
$(f)$ no financial assistance will be provided by the Company to Mr Kins for the purpose of acquiring the Shares as they are to be issued for no cash consideration:
$(q)$ details of any Shares issued under the Plan will be published in each annual report of the Company relating to a period in which the Shares have been issued, and that approval for the issue of Shares was obtained under ASX Listing Rule 10.14;
any additional directors (or associates of directors) who become $(h)$ entitled to participate in the Plan after Resolution 5 is approved, and who are not named in paragraph 4.5(a) of this Notice of Meeting, will not participate until approval is obtained under ASX Listing Rule 10.14; and
the Shares referred to in paragraph (b) above will be issued under the $\left($ i Plan within 3 years after the date of the Meeting.

A summary of the terms and conditions of the Plan is contained in Section 1.2 of this Explanatory Statement. A copy of the rules of the Plan which sets out the full terms and conditions of the Plan will be sent free to any Shareholder upon request, or may be inspected at the Company's registered office during normal business hours.

$5¹$ RESOLUTION 6 - APPROVAL OF TERMINATION BENEFITS

$5.1$ Backaround

Resolution 6 seeks Shareholder approval for the terms of Clause 10 of the employment agreement between the Company and Mr Imants Kins, a Director of the Company (Employment Agreement).

Clause 10 of the Employment Agreement provides that Mr Kins will receive certain termination benefits if the Employment Agreement is terminated within the initial 3 year term of the Employment Agreement (Term):

by Mr Kins in the event that the Company breaches the Employment $(a)$ Agreement and that breach is not remedied within 14 days of the Company receiving written notice to do so:
$(b)$ by the Company giving to Mr Kins 3 months' written notice (without cause) of termination; or
$\left( c\right)$ by the Company in a situation in which the nature of the services which the Board reauires Mr Kins to undertake pursuant to the Employment Agreement materially changes without Mr Kins' consent (Material Change of Services).

The termination benefits which Mr Kins will receive in the above circumstances are as follows:

all continuity of service conditions and Performance Criteria referred to $(a)$ in clause 5.5 of the Employment Agreement (and set out in Section 4.1 of this Explanatory Statement) shall be deemed to have been satisfied and accordingly the Shares issued to Mr Kins will no longer be subject to the Plan Restrictions: and
$(b)$ the Company shall:
pay to Mr Kins an amount equal to the value of the $\left{ i \right}$ remuneration that would have been paid to him during the remainder of the Term as if the Aareement had not been terminated or a Material Change of Services had not occurred; and
if a bonus has previously been paid to Mr Kins under the $\overline{(\mathsf{iii})}$ Employment Agreement - pay to Mr Kins a bonus amount determined in accordance with the following formula:

$a = (b/c) \times d$

where:

the amount of the bonus: $q =$

$h =$ the total value of previous bonuses received by the Executive up until termination under the Employment Agreement during the initial 3 year Term:
the number of days in the period from the $C =$ commencement of the Employment Agreement to the end of the last period in respect of which the Board had made a determination as to whether to pay a bonus to Mr Kins under the Employment Agreement; and
$d =$ the number of days in the period from the end of the last period in respect of which the Board had made a determination as to whether to pay a bonus to Mr Kins under the Employment Agreement, to the end of the 3 vear initial Term; or
$(iii)$ if a bonus has not previously been paid to Mr Kins under the Employment Agreement - pay to Mr Kins a bonus amount determined at the discretion of the Board, but taking into account^®
$(A)$ the amount of bonus that would have been likely to have been paid had the Employment Agreement not been terminated or a Material Change of Services not occurred, based on the performance of Mr Kins up to that point: and
the formula set out in paragraph (ii) above. $(B)$

The full term of the Employment Agreement is three years commencing on 1 October 2005.

ASX Listing Rule 10.19 and Section 200B of the Corporations Act require a company to obtain shareholder approval where the value of a termination benefit given to a director exceeds a certain amount.

$5.2$ ASX Listing Rule 10.19

ASX Listing Rule 10.19 provides that a listed company must ensure that, unless shareholder approval is obtained, no director of the company may be entitled to termination benefits if the value of those benefits and the termination benefits that may become payable to all officers together exceed 5% of the equity interests of the company.

If the Employment Agreement is terminated in the circumstances set out in section 5.1 above, the termination payments payable to Mr Kins, when aggregated with any other termination payments payable to officers of the Company, may exceed 5% of the equity interests of the Company. $\mathbb{H}$ Shareholder approval is obtained pursuant to Resolution 6, it will enable the Company to make any such termination payments without having to seek Shareholder approval at the time of any such termination.

$5.3$ Section 2008 of the Corporations Act

Section 200B of the Corporations Act provides that a company must not give a director a benefit in connection with his or her retirement from office without shareholder approval.

Section 200F of the Act sets out some exceptions to the requirement to obtain shareholder approval, including where:

$(a)$ the value of the termination benefit is below a certain limit; or
$(b)$ where the benefit is:
$(i)$ a genuine payment of damages for breach of contract; or
$(ii)$ part of the consideration offered to the person to become a director.

The Directors are of the opinion that although the termination payments contemplated by Clause 10 of the Employment Agreement may fall within one of the exceptions to Section 200F, it would be prudent to obtain Shareholder approval prior to entering into the Employment Agreement to ensure that the Company does not breach Section 200B of the Act if the Employment Agreement is termingted in the circumstances set out above.

If Shareholder approval under Section 200B is obtained pursuant to Resolution 6. it will enable the Company to make the termination payments to Mr Kins without the necessity of seeking Shareholder approval at the time of any such termination.

5.4 Information required by Section 200E of the Corporations Act

Section 200E of the Act requires that the following information be provided to Shareholders when seeking an approval for the purposes of Section 2008 of the Act:

the termination benefit consists of a monetary payment consisting of the $(a)$ following amounts:
$\left( i\right)$ an amount equal to the value of the remuneration that would have been paid to Mr Kins under the Employment Agreement during the remainder of the initial 3 year Term as if the Employment Agreement had not been terminated or a Material Change of Services not occurred: and
$(ii)$ a bonus amount calculated in accordance with the formula set out in Section 5.1(b) above;
$(b)$ accordingly, the value of the monetary payment will depend upon:
$\left{ i\right}$ the duration of the remainder of the Term of the Employment Agreement. The Term is a period of three years commencing 1 October 2005:
the annual remuneration of Mr Kins. The remuneration is $(ii)$ currently set at \$161,000 (including superannuation) and is subject to annual inflation and performance reviews:
$(iii)$ the value of any bonuses paid by the Company to Mr Kins during his employment;
the termination benefit consists of a non-monetary benefit being the $\left( c\right)$ deemed satisfaction of the continuity of service conditions and Performance Criteria for the purposes of clause 5.5 of the Employment Agreement, and the subsequent removal of the Plan Restrictions from the Shares issued to Mr Kins pursuant to clause 5.5 of the Employment Aareement.

Ordinarily the Company is required to determine the money value of the proposed benefit or if that value can not be ascertained at the time of the disclosure to state the manner in which the value is to be calculated and any matter, event or circumstance that will, or is likely to, affect the calculation of that value.

Ascertaining the value of this component of the benefit is difficult in the current circumstances due to the uncertainty surrounding the satisfaction of the Performance Criteria, the potential length of service, and the future share price of the Company. As such, calculating an accurate value of the proposed benefit is uncertain. However, the value of the benefit could range from nil to \$225,000 if the maximum guantum of shares is allocated, based on a Share price of 5.0 cents per Share (being the most recent trading price of Shares on ASX).

RESOLUTION 7 - CHANGE OF COMPANY NAME $\mathbf{6}$ .

The new name proposed to be adopted under Resolution 7 is "ABM Resources" $N1$ ."

GLOSSARY

ASX means Australian Stock Exchange Limited (ABN 98 008 624 691).

ASX Listing Rules or Listing Rules means the listing rules of ASX.

Board means the board of directors of the Company.

Company means Tantalum Australia NL (ABN 58 009 127 020).

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.

Nofice means the notice of meeting accompanying this Explanatory Statement.

Plan means the Tantalum Australia NL Employee Share Plan.

Resolution means a resolution contained in the Notice.

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

Shareholder means a holder of Shares.

WST means Western Standard Time

\$ means Australian dollars.

SCHEDULE 1 - ALLOTTEES OF PLACEMENT SHARES

For the purposes of Resolution 4, the Shares were allotted to the persons set out below:

Name	Shares
TRICOM NOMINEES PTY LTD
JUTTA ZIMMERMANN & DANIAL COE	15,000,000
	600,000
JEMAYA PTY LTD
PERTH SELECT SEAFOODS PTY LTD	2,000,000
	2,000,000
MR BRIAN JOHN FAITHFULL
	1,900,000
MR DONALD NORMAN COULTAS
IAN WICKENS PTY LTD	2,000,000
	1,000,000
MR ROBIN COLLARD & MRS HELEN PATRCIA ELLIOT
	500,000
SAVOY MANAGEMENT PTY LTD
JAMESBRIDGE PTY LTD	1,000,000
	1,000,000
I H HOLDINGS PTY LTD
	1,000,000
REDPORT ENTERPRISES PTY LTD
	1,000,000
ACUMEN ENGINEERING PTY LTD	1,000,000

Total	30,000,000

APPOINTMENT OF PROXY TANTALUM AUSTRALIA NL ARN 58 009 127 020

$I/We$

Appoint

being a Member of Tantalum Australia NL entitled to attend and vote at the Meeting, hereby

Name of proxy

or failing the person so named or, if no person is named, the Chairman of the Meeting or the Chairman's nominee, to vote in accordance with the following directions or, if no directions have been given, as the proxy sees fit at the General Meeting to be held at 10.00am (WST) on 31 July 2006 at Level 8, 256 St Georges Terrace, Perth, Western Australia and at any adjournment thereof. If no directions are given, the Chairman will vote in favour of all of the resolutions.

Voting on Business of the General Meeting

Resolution 1	Adoption of Employee Share Plan
Resolution 2	Ratification of Issue of Securities to Employees
Resolution 3	Ratification of Share Placement
Resolution 4	Ratification of Share Placement
Resolution 5	Issue of Shares to Mr Imants Kins
Resolution 6	Approval of Termination Benefits
Resolution 7	Change of Company Name
	14.

If you do not wish to direct your proxy how to vote, please place a mark in this box

day of

By marking this box, you acknowledge that the Chairman may exercise your proxy even if he has an interest in the outcome of the resolution and votes cast by him other than as proxy holder will be disregarded because of the interest. The Chairman will vote in favour of all of the resolutions if no directions are aiven.

YOU MUST EITHER MARK THE BOXES DIRECTING YOUR PROXY HOW TO VOTE OR MARK THE BOX INDICATING THAT YOU DO NOT WISH TO DIRECT YOUR PROXY HOW TO VOTE, OTHERWISE THIS APPOINTMENT OF PROXY FORM WILL BE DISREGARDED.

If you mark the abstain box for a particular item, you are directing your proxy not to vote on that item on a show of hands or on a poll and that your shares are not to be counted in computing the required majority on a poll.

Signed this

2006

Bv:

Individuals and joint holders

Signature

Signature

Signature

Companies if (affix common seal appropriate)

FOR

AGAINST ABSTAIN

Director

Director/Company Secretary

Sole Director and Sole Company Secretary

TANTALUM AUSTRALIA NL ABN 58 009 127 020

Instructions for Completing 'Appointment of Proxy' Form

$\mathbb{L}$ A member entitled to attend and vote at a Meeting is entitled to appoint not more than two proxies to attend and vote on their behalf. Where more than one proxy is appointed, such proxy must be allocated a proportion of the member's voting rights. If the shareholder appoints two proxies and the appointment does not specify this proportion, each proxy may exercise half the votes.
$\overline{2}$ . A duly appointed proxy need not be a member of the Company. In the case of joint holders, all must sian.
$\overline{3}$ . Corporate shareholders should comply with the execution requirements set out on the proxy form or otherwise with the provisions of Section 127 of the Corporations Act. Section 127 of the Corporations Act provides that a company may execute a document without using its common seal if the document is signed by:
directors of the company;
a director and a company secretary of the company: or
for a proprietary company that has a sole director who is also the sole company secretary - that director.

For the Company to rely on the assumptions set out in Section 129(5) and (6) of the Corporations Act, a document must appear to have been executed in accordance with Section 127(1) or (2). This effectively means that the status of the persons signing the document or witnessing the affixing of the seal must be set out and conform to the requirements of Section 127(1) or (2) as applicable. In particular, a person who witnesses the affixing of a common seal and who is the sole director and sole company secretary of the company must state that next to his or her signature.

$\overline{4}$ . Completion of a proxy form will not prevent individual shareholders from attending the meeting in person if they wish. Where a shareholder completes and lodges a valid proxy form and attends the meeting in person, then the proxy's authority to speak and vote for that shareholder is suspended while the shareholder is present at the meeting
1. Where a proxy form or form of appointment of corporate representative is lodged and is executed under power of attorney, the power of attorney must be lodged in like manner as this proxy.
To vote by proxy, please complete and sign the proxy form enclosed: 6.
deliver the proxy form to the Company's registered office at 24 Mumford $(\alpha)$ Place, Balcatta, Western Australia 6021; or
$(b)$ by facsimile to the Company on facsimile number (61 8) 6241 1818; or
$(c)$ deliver the proxy form to the Company's share registry, Security Transfer Registrars Pty Ltd, 770 Canning Highway, Applecross, Western Australia 6153,

so that it is received not later than 10.00am (WST) on 29 July 2006.

Proxy forms received later than this time will be invalid.