PROSPECT RESOURCES LIMITED — Capital/Financing Update 2022

Jul 11, 2022

+Rule 3.10.1, 3.20.4, 7.18-7.24, 15.3, Appendix 7A section 8

Appendix 3A.4

Notification of cash return of capital

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.

Please note that two or more corporate actions on the same +security may not run with different record dates if the timetables result in overlapping (but not identical) ex-periods. It is permissible to run different corporate actions with the same record date except in the case of consolidations or splits which cannot run at the same time as any other corporate action for that entity.

*Denotes minimum information required for first lodgement of this form.

**Denotes information that must be provided on or before +business day 0 of the relevant Appendix 6A or Appendix 7A timetable.

The balance of the information, where applicable, must be provided as soon as reasonably practicable by the entity.

If a cash special dividend is paid at the same time as the return of capital the entity must also lodge Appendix 3A.1 – notification of dividend / distribution.

Part 1 – Entity and announcement details

Questionno	Question	Answer
1.1	*Name of entity	Prospect Resources Limited
1.2	*Registration type and numberOne of ABN/ARSN/ARBN/ACN or other registrationtype and number (if "other" please specify what typeof registration number has been provided).	ACN 124 354 329
1.3	*ASX issuer code
1.4	*The announcement isTick whichever is applicable.	New announcementxUpdate/amendment to previousannouncementCancellation of previous announcement
1.4a	*Reason for updateMandatory only if "Update" ticked in Q1.4 above. Areason must be provided for an update.	Per the Addendum to Notice ofExtraordinary General Meeting released tothe ASX on 11 July 2022 the CapitalReduction has been amended from $0.19per share to $0.17 per share. The timelinehas also changed.
1.4b	*Date of previous announcement to thisupdateMandatory only if "Update" ticked in Q1.4 above.	17 June 2022
1.4c	*Reason for cancellationMandatory only if "Cancellation" ticked in Q1.4 above.If information has previously been provided in Part 3Dof the form "Preference +security distribution ratedetails" please also confirm whether the rate changesremain in place for the +security or are also cancelled.	N/A
1.4d	*Date of previous announcement to thiscancellation	N/A

• See chapter 19 for defined terms

1 December 2019 Page 1

	Mandatory only if "Cancellation" ticked in Q1.4 above.
1.5	*Date of this announcementThe date of lodgement of the form by the entity viaASX Online.	12 July 2022
1.6	*Applicable ASX +security code anddescription for cash return of capitalPlease select the +security to which the notificationapplies. Only one +security can be selected for eachform. Consequent changes to option pricing arecovered in later parts of this form.	ASX +security code: PSC+Security description: Ordinary Fully Paid

Part 2 – Approvals

QuestionNo.	Question			Answer
2.1	••••••"no" go to Q2.2.information".	*Are any of the below approvals requiredfor the cash return of capital beforebusiness day 0 of the timetable?+Security holder approvalCourt approvalLodgement of court order with +ASICACCC approvalFIRB approval;Another approval/condition external tothe entity required to be given/metbefore business day 0 of the timetablefor the cash return of capital.If any of the above approvals apply to the cash returnof capital before business day 0 of the timetable,please answer 'yes' and provide details at Q2.1a. IfThe purpose of the question is to confirm that relevantapprovals are received prior to ASX establishing anex market in the +securities. If the entity wishes todisclose approvals or conditions which are to beresolved at a later date it should use Part 5 "Further		YesSecurityholder approval (see below)
2.1a	Approvals	Select appropriate approval from drop down box as applicable. More than one approval can be selected. Thisquestion refers only to events which take place before business day 0 of the timetable. The purpose of thequestion is to confirm that relevant approvals are received prior to ASX establishing an ex market in the+securities. The "Date for determination" is the date that you expect to know if the approval is given for examplethe date of the +security holder meeting in the case of +security holder approval or the date of the court hearingin the case of court approval. If the entity wishes to disclose approvals or conditions which are to be resolved ata later date it should use Part 5 "Further information". Please note that Listing Rules 7.19.1-7.19.3 set timelimits for the notification of court approval, the proposed date for lodgement of court order with a regulatoryauthority and confirmation that the court order has been lodged with the regulatory authority.
*Approval/condition		*Date fordetermination	*Is the dateestimated oractual?	**Approvalreceived/conditionmet?Only answer thisquestion whenyou know theoutcome of theapproval –please adviseon or before+business day 0of the relevantAppendix 6A orAppendix 7Atimetable.	Comments
+Security holderapproval		22 July 2022	EstimatedORxActual	YesNo	The EGM to seek approvalof the cash return ofcapital was originallyscheduled for 18 July 2022but has been moved to 22July 2022 to allowsecurityholders sufficienttime to consider the

					amendment to the cashreturn of capital amount.
Court approval			EstimatedORActual	YesNo
Lodgement ofcourt order with+ASIC			EstimatedORActual	YesNo
ACCC approval			EstimatedORActual	YesNo
FIRB approval			EstimatedORActual	YesNo
Other (pleasespecify incomment section)			EstimatedORActual	YesNo
2.2	*Is the cash return of capital a selectivereduction of capitalIf "yes" please answer Q2.2a and 2.2b, if "no" go to			No
2.2a	Part 3.*Date of lodgement of +security holderresolution approving the cash return ofcapital with +ASIC		N/A
Please provide the estimated or actual date oflodgement of +security holder resolution approving thecash return of capital with +ASIC. If estimated date isprovided please provide the actual date by way of anupdate to this form when the resolution has beenlodged with +ASIC.
2.2b	*Date that is fourteen days after date oflodgement of +security holder resolutionapproving the capital return with +ASIC		N/A

Amended 29/06/15

Part 3 – cash return of capital timetable and details

QuestionNo.	Question	Answer
3.1	*+Record date	28 July 2022
	Per Appendix 7A, section 8 the +record date is+business day 3 in the timetable. This is three+business days after the effective date (Q3.1a).
	This is the last day for the entity to register transferson a pre return of capital basis and the date on whichthe register is closed to determine entitlements to thecash return of capital.
	The +record date must be at least four +business daysfrom the current date.
	Please note that the +record date and the date thattrading in the re-organised +securities on an "exreturn of capital" basis commences (Q3.3) cannot bechanged (even to postpone it or cancel it) any laterthan 12 noon Sydney time on the day before thepreviously advised date that trading in the reorganised +securities on an "ex return of capital"basis commences (Q3.3)
3.1a	Effective date of the cash return of capital	25 July 2022
	Per Appendix 7A, section 8 the effective date is+business day 0 in the timetable and is 3 +businessdays before the +record date.
	In the case of an equal reduction, this is the day afterthe resolution approving the cash return of capital andin the case of a selective reduction, 14 days after thedate of lodgement of a copy of the resolutionapproving the cash return of capital with ASIC undersection 256C(3) of the Corporations Act.
3.2	*Does the entity have quoted options onissue	No
	If the answer is Yes, answer 3.4a, 3.5a & b
3.2a	Last day for trading in "cum return ofcapital" +securities. If the entity has quotedoptions, last day for trading in pre-return ofcapital quoted options.	N/A
	Per Appendix 7A, section 8 this is +business day 1 inthe timetable and one +business day after theeffective date.
	The last day for trading in pre return of capital quotedoptions only applies if the entity has quoted options inwhich case the exercise price will change and newholding statements will be issued to option holders.
3.3	*Trading in the re-organised +securities onan "ex return of capital" basis commences.	27 July 2022
	If the entity has quoted options and ASXagrees, trading in the quoted optionscommences on a +deferred settlementbasis.
	If the entity's +securities are suspended from tradingduring this period there will be no +deferredsettlement trading however ASX still captures thisdate.
	Per Appendix 7A, section 8 this is +business day 2 inthe timetable and the second +business day after theeffective date.

	Please note that the +record date and the date thattrading in the re-organised +securities on an "exreturn of capital" basis commences cannot bechanged (even to postpone it or cancel it) any laterthan 12 noon Sydney time on the day before thepreviously advised last day for trading in "cum returnof capital" +securities (Q3.2a).
3.4	+Record date	28 July 2022
	Same as Q3.1 above.
3.4a	If the entity has quoted options, first day forthe +entity to send holding statements to+security holders notifying them of thechange in exercise price for the quotedoptions they hold.	N/A
	This date only applies if the entity has quoted options.
	Per Appendix 7A, section 8 this is +business day 4 inthe timetable and one +business day after the recorddate.
3.5	* Payment date for cash return of capital.	4 August 2022
	If applicable and the +entity has quotedoptions, +deferred settlement market inoptions ends. Last day for entity to sendholding statements to +security holdersnotifying them of the change in exerciseprice for the quoted options they hold andto notify ASX that this has occurred.
	Per Appendix 7A, section 8 this is +business day 8 inthe timetable and five +business days after the+record date.
	Please note that the payment date cannot bechanged (even to postpone it or cancel it) any laterthan 12 noon Sydney time on the day of the previouspayment date advised.
3.5a	If the entity has quoted options, trading inthe options starts on a normal T+2 basis	N/A
	Per Appendix 7A, section 8 this is +business day 9 inthe timetable. This date is six +business days after the+record date and is the +business day after thepayment date.
3.5b	If the entity has quoted options, firstsettlement of trades conducted on a+deferred settlement basis and on a normalT+2 basis	N/A
	Per Appendix 7A, section 8 this is +business day 11 inthe timetable. This date is eight +business days afterthe +record date and two +business days after T+2trading starts.
3.6	*Currency in which the cash return ofcapital is made	AUD
	This currency will be the currency in which all otherfields relating to the return of capital will appear. Thisis referred to as the "primary currency".
3.7	*Cash return of capital amount per+security	0.17
	Please provide the amount of the cash return ofcapital in the primary currency. If the currency is notAUD please answer 3.7a – 3.7c.

3.7a	AUD equivalent return of capital amountper +security (in primary currency)	N/A
	Only for non-AUD returns of capital.
	ASX publishes an AUD equivalent amount for nonAUD returns of capital. If this amount is not providedby the entity it is calculated and published using theRBA rate of exchange on the day before the effectivedate. The entity should only populate this field if anactual amount is known. If amount not known pleaseanswer 3.7b. If known go to 3.7c.
3.7b	If AUD equivalent not known, date forinformation to be released	N/A
3.7c	FX rate (in format AUD 1.00 / Primarycurrency rate)	N/A

Amended 07/03/16; Amended 01/12/19

Part 4 – Changes to option pricing as a result of the cash return of capital

QuestionNo.	Question		Answer
4.1	*Will the cash return of capital affectthe exercise price of any entityissued options		No
	If "yes", please answer Q4.1a, if "no" go toPart 5.
4.1a	*Exercise price of options
	Please confirm the exercise price of options on issue before and after the cash return of capital. Please providethe amount in the primary currency in dollars (or equivalent denomination for foreign currency). Listing Rule7.22.3 governs the change in exercise price of options in a cash return of capital. If there is more than one+security please include the additional +securities.
ASX+securitycode	ASX +securitydescription	Quoted/unquoted	Currency	Exercise pricebefore cashreturn of capital	Exercise price aftercash return of capital

Part 5 – Further Information

QuestionNo.	Question	Answer
5.1	*Has the entity applied for an ATO classruling relating to this cash return of capital?If "yes" please answer Q5.1a, if "no" go to 5.2. If theATO ruling is a condition of the event proceedingplease include it at Q2.1 and 2.1a – Conditions.	Yes
5.1a	*Please provide further information on theATO rulingIf the ATO ruling is a condition of the eventproceeding please include it at item 2.1 and 2.1a -Conditions.	Based on consultation with the ATO, theCompany has received advice that the capitalreduction amount for tax purposes will be upto $0.17 per share and it is expected that theATO Class Ruling will be finalised on thisbasis.
5.2	Source of funds for cash return of capital	The return of capital forms part of a largercash distribution of AUD0.96 per sharerepresenting the distribution of proceeds fromthe sale of the Company's Arcadia Project.
5.3	Further information relating to this cashreturn of capitalPlease provide any further information relating to thiscash return of capital.	This AUD0.17 per share cash return ofcapital forms part of an overall cashdistribution of AUD0.96 per share. Theremaining AUD0.79 per share is beingdistributed via an unfranked dividend. Pleasesee the Addendum to Notice of ExtraordinaryGeneral Meeting lodged with the ASX on 11July 2022 for further information.

Introduced 22/09/14, Amended 29/06/15; Amended 07/03/16; Amended 01/12/19

+ See chapter 19 for defined terms 1 December 2019 Page 9