Black Mountain Resources Ltd

ABN 55 147 106 974

Notice of Extraordinary General Meeting

Date of Meeting 15 August 2016

Time of Meeting 10.00 a.m.

Place of Meeting Suite 183, Level 6, 580 Hay Street Perth WA 6000

This is an important document. Please read it carefully and in its entirety. If you do not understand it please consult with your professional advisers.

If you are unable to attend the General Meeting, please complete the Proxy Form enclosed and return it in accordance with the instructions set out in that form.

Notice of Extraordinary General Meeting

Black Mountain Resources Limited

ABN 55 147 106 974

An Extraordinary General Meeting of Black Mountain Resources Limited (Company) will be held at Suite 183, Level 6, 580 Hay Street, Perth, WA 6000, at 10.00 a.m. on 15 August 2016.

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

The Explanatory Memorandum which accompanies and forms part of this Notice describes the matters to be considered at the General Meeting.

AGENDA

ORDINARY BUSINESS

1. Resolution 1 – Approval of consolidation of Existing Shares

To consider and, if thought fit, to pass as an ordinary resolution:

"That, subject to the passing of Resolution 10, for the purposes of section 254H of the Corporations Act and the Constitution and for all other purposes, approval is given that the Existing Shares in the Company be consolidated on a 1 for 10 basis with effect from the date this Resolution is passed, with any fractional entitlements being rounded up, on the terms and conditions set out in the Explanatory Memorandum."

2. Resolution 2 – Approval of Transaction

To consider and, if thought fit, to pass the following as an ordinary resolution:

"That, subject to the passing of Resolutions 1, 3, 4, 5, 6 and 10, for the purpose of ASX Listing Rule 10.1 and for all other purposes, approval is given for the Company to enter into the Transaction, on the terms and conditions set out in the Explanatory Memorandum."

Voting Exclusion Statement: The Company will disregard any votes cast on Resolution 2 by a Transaction Party (including AP and Jason Brewer) and any of their Associates.

Expert Report: Shareholders should carefully consider the Independent Expert's Report prepared for the purpose of the Shareholder approval required under ASX Listing Rule 10.1. The Independent Expert's Report comments on the fairness and reasonableness of the transactions the subject of this Resolution to the non-associated Shareholders in the Company. The Independent Expert has determined the Transaction is both fair and reasonable to the non-associated Shareholders in the context of the Transaction.

3. Resolution 3 – Approval of Issue of Consideration Shares to JRH, RPM and LBI and the Advisory Fee and Working Capital Fee to LBI

To consider and, if thought fit, to pass as an ordinary resolution:

"That, subject to the passing of Resolutions 1, 2, 4, 5, 6 and 10, for the purposes of Section 208 of the Corporations Act, ASX Listing Rule 10.11 and for all other purposes, approval is given for the Company to issue:

(a) 4,978,803 Consideration Shares to JRH;
(b) 27,641,577 Consideration Shares to RPM; and
(c) 570,000 Consideration Shares to LBI,

and pay the Advisory Fee and Working Capital Fee to LBI on the terms and conditions set out in the Explanatory Memorandum."

Voting Exclusion Statement: The Company will disregard any votes cast on Resolution 3 by JRH,

RPM and LBI and any of their Associates.

4. Resolution 4 – Approval of Issue of AP Agreement Shares to AP

To consider and, if thought fit, to pass as an ordinary resolution:

"That, subject to the passing of Resolutions 1 to 3, 5, 6 and 10, for the purposes of Section 208 of the Corporations Act, ASX Listing Rule 10.11 and for all other purposes, approval is given for the Company to issue 9,500,000 AP Agreement Shares to AP, on the terms and conditions set out in the Explanatory Memorandum."

Voting Exclusion Statement: The Company will disregard any votes cast on Resolution 4 by AP and any of its Associates.

5. Resolution 5 – Approval of Issue of AP Agreement Shares to JC or its nominees

To consider and, if thought fit, to pass as an ordinary resolution:

"That, subject to the passing of Resolutions 1 to 4, 6 and 10, for the purposes of Section 208 of the Corporations Act, ASX Listing Rule 10.11 and for all other purposes, approval is given for the Company to issue 5,500,000 AP Agreement Shares to JC (or its nominees), on the terms and conditions set out in the Explanatory Memorandum."

Voting Exclusion Statement: The Company will disregard any votes cast on Resolution 5 by JC and any of its Associates.

6. Resolution 6 – Issue of AP Agreement Shares to Langleycourt and Alpha or their nominees

To consider and, if thought fit, to pass as an ordinary resolution:

"That, subject to the passing of Resolutions 1 to 5 and 10, for the purposes of Section 208 of the Corporations Act, ASX Listing Rule 10.11 and for all other purposes, approval is given for the Company to issue 3,500,000 AP Agreement Shares and grant a 20% share of the Royalty to Langleycourt and Alpha (or their nominees), on the terms and conditions set out in the Explanatory Memorandum."

Voting Exclusion Statement: The Company will disregard any votes cast on Resolution 6 by Langleycourt and Alpha and any of their Associates.

7. Resolution 7 – Election of Luca Bechis as a Director

To consider and, if thought fit, to pass as an ordinary resolution:

'That, subject to the passing of Resolutions 1 to 6 and 10, Luca Bechis is to be appointed as a Director in accordance with the Corporations Act and the Constitution, effective upon Completion."

8. Resolution 8 – Election of Simon Grant-Rennick as a Director

To consider and, if thought fit, to pass as an ordinary resolution:

'That, subject to the passing of Resolutions 1 to 6 and 10, Simon Grant-Rennick is to be appointed as a Director in accordance with the Corporations Act and the Constitution, effective upon Completion."

9. Resolution 9 – Election of Julian Ford as a Director

To consider and, if thought fit, to pass as an ordinary resolution:

'That Julian Ford is to be appointed as a Director in accordance with the Corporations Act and the

Constitution, effective upon Completion."

10. Resolution 10 – Issue of New Shares pursuant to the Capital Raising

To consider and, if thought fit, to pass as an ordinary resolution:

"That, subject to the passing of Resolution 1, for the purpose of Listing Rule 7.1 and for all other purposes, approval is given for the Company to issue of up to 45,000,000 New Shares at a price of $0.10 per New Share to the public under a prospectus, as soon as practicable following the General Meeting, on the terms and conditions set out in the Explanatory Memorandum."

Voting Exclusion Statement: The Company will disregard any votes cast on Resolution 10 by a person who may participate in the proposed issue and a person who might obtain a benefit, except a benefit solely in the capacity of a holder of Shares, if this Resolution is passed, and any person associated with 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 directions on the Proxy Form, or if it is cast by the Chairman of 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.

NB: The persons who will participate in the proposed issue have not yet been determined.

11. Resolution 11 – Issue of Finance Options

To consider and, if thought fit, to pass as an ordinary resolution:

"That, for the purpose of ASX Listing Rule 7.1 and for all other purposes, approval is given for the Company to issue up to 2,500,000 Finance Options, exercisable at $0.125 per Finance Option on or before 30 June 2018, on the terms and conditions set out in the Explanatory Memorandum."

Voting Exclusion: The Company will disregard any votes cast on Resolution 11 by a person who may participate in the proposed issue and a person who might obtain a benefit, except a benefit solely in the capacity of a holder of Shares, and any associates of those persons. However, 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 if 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.

12. Resolution 12 – Issue of Debt Conversion Shares

To consider and, if thought fit, to pass as an ordinary resolution:

"That, for the purposes of ASX Listing Rule 7.1 and for all other purposes, approval is given for the Company to issue 15,474,800 Debt Conversion Shares to Nazdall, Seefeld, Tyche, Gorilla and various Unrelated Creditors on the terms and conditions set out in the Explanatory Memorandum."

Voting Exclusion: The Company will disregard any votes cast on Resolution 12 by any person who may participate in the proposed issue and a person who might obtain a benefit, except a benefit solely in the capacity of a holder of Shares, and any associates of those persons. However, 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 directors on the Proxy Form, or, it is cast by the person chairing the meeting as a proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides.

NOTES

These notes form part of the Notice of Meeting.

1. Background information

To assist you in deciding how to vote on the Resolutions, background information to the resolutions

is set out in the Explanatory Memorandum forming part of this Notice of Meeting.

2. Recommendation

The Board believes Resolutions 1 to 12 are in the best interests of the Shareholders and (save where otherwise indicated in the Explanatory Memorandum) unanimously recommends Shareholders vote in favour of each of them.

3. Voting entitlements

The Directors have determined that, for the purpose of voting at the General Meeting, Shareholders eligible to vote at the General Meeting are those persons who are the registered holders of Shares at 10.00 a.m. (AWST) on 13 August 2016.

4. How to vote

You may vote by attending the General Meeting in person, by proxy, or by an authorised representative.

5. Voting in person

To vote in person, attend the General Meeting on the date and at the place set out above. Shareholders are asked to arrive at the venue by 9.45 a.m. AWST so the Company may check their Shareholding against the Company's Share register and note attendances.

6. Voting by proxy

A Shareholder has the right to appoint a proxy (who need not be a Shareholder). A proxy can be an individual or a body corporate. A body corporate appointed as a Shareholder's proxy must appoint a representative to exercise any of the powers the body corporate can exercise as a proxy at the General Meeting. The representative should bring to the General Meeting evidence of their appointment, including any authority under which the appointment is signed, unless it has previously been given to the Company.

If a Shareholder is entitled to cast two or more votes they may appoint two proxies and may specify the percentage of votes each proxy is appointed to exercise.

To vote by proxy, the Proxy Form (together with the original of any power of attorney or other authority, if any, or certified copy of that power of attorney or other authority under which the Proxy Form is signed) must be received at the address noted below before the time and day noted below. Proxy Forms received after that time will be invalid. Proxy Forms must be received before that time via any of the following methods:

By Post:	Share Registry – Computershare Investor Services Pty Limited, GPO Box 242,Melbourne Victoria 3001, Australia
By Facsimile:	1800 783 447 (within Australia)+61 3 9473 2555 (outside Australia)
Custodian voting:	ForIntermediaryOnlinesubscribersonly(custodians)pleasevisitwww.intermediaryonline.com to submit your voting intentions

Any proxy form received after 10.00 a.m. (AWST) on 13 August2016 will not be valid for the General Meeting.

7. Voting by corporate representatives

A body corporate may elect to appoint an individual to act as its representative in accordance with section 250D of the Corporations Act. A certificate of appointment of the corporate representative will be sufficient for these purposes and must be lodged with the Company before the General Meeting or at the registration desk on the day of the General Meeting.

8. Questions from Shareholders

The Chairman of the General Meeting will allow a reasonable opportunity for Shareholders to ask questions or make comments on the management and performance of the Company.

To assist the Board in responding to any questions you may have, please submit any questions you may have by fax or to the address below by no later than 5.00 p.m. AWST on 9 August 2016**.**

By Post: PO Box 1628, Subiaco, WA 6904 By Facsimile: +61 8 9380 8300

9. Enquiries

Shareholders are invited to contact the Company Secretary on +61 8 9380 8343 if they have any queries on the matters set out in these documents.

By order of the Board

Date 13 July 2016

Signed _____________________________

Name Jason Brewer, Director

The Notice of Meeting, Explanatory Memorandum and Proxy Form should be read in their entirety. If Shareholders are in doubt as to how they should vote, they should seek advice from their accountant, solicitor or other professional adviser prior to voting.

EXPLANATORY MEMORANDUM

This Explanatory Memorandum and all attachments are important documents and should be read carefully. If you have any questions regarding the matters set out in this Explanatory Memorandum or the preceding Notice of Meeting please contact the Company, your stockbroker or other professional adviser.

This Explanatory Memorandum has been prepared for Shareholders in connection with the Extraordinary General Meeting of the Company to be held at 10.00 a.m. on 15 August 2016 at Suite 183, Level 6, 580 Hay Street, Perth WA 6000.

The purpose of this Explanatory Memorandum is to provide Shareholders with information the Board believes to be material to Shareholders in deciding whether or not to approve the resolutions detailed in the Notice of Meeting.

The resolutions broadly fit into 4 categories, with these being:

(a) resolution to consolidate shares (Resolution 1);
(b) resolutions to give effect to the Transaction (Resolutions 2 to 6);
(c) resolutions to elect directors (Resolutions 7 9);
(d) resolutions approving the issue of new shares and options (Resolutions 10 12).

1. BACKGROUND INFORMATION REGARDING THE TRANSACTION

1.1 Background to Transaction

On 5 February 2016, the Company announced to ASX it had entered into an agreement to acquire the option that African Phosphate Pty Limited (AP) held to purchase 100% of the share capital in GLF Holdings Limited (Gulf) from its existing shareholders, Richmond Partners Masters Limited (RPM) and Jonah Resource Holdings Limited (JRH) (the Transaction).

A list of the parties to the Transaction is set out in section 1.3 below.

A summary of the key terms of the Transaction is set out in section 1.4 below.

Gulf is the 100% shareholder of Namakera Mining Company Limited (NMCL), directly and indirectly through its 100% interest in Industrial Minerals International Corporation (IMIC).

On 11 April 2016, the Company announced that it had executed a Share Sale Agreement and Deed of Assignment with GLF's shareholders to proceed with the acquisition subject to the Company obtaining all necessary shareholder and regulatory approvals pursuant to ASX Listing Rules, Corporations Act 2001 (Cth) and other applicable law or regulations, including but not limited to, approval to reinstatement to official quotation on ASX of the Company.

NMCL operates a producing vermiculite mine (Namakera Vermiculite Mine) and a phosphate project (Busumbu Phosphate Project) with historical production located in Uganda. Further detail on these is set out below. The acquisition of NMCL (and, therefore, of the Namakera Vermiculite Mine and the Busumbu Phosphate Project) is considered by management to provide the Company with an opportunity to acquire an established mining and exporting operation with expansion and development upside in the agriculture and fertiliser sector.

A high level overview of the corporate structure of the Company post the proposed acquisition is summarised below.

a. Namakera Vermiculite Mine

Detailed technical information on the Namakera Vermiculite Mine, is included in the Independent Technical Valuation included in this Notice of Meeting.

The Namakera Vermiculite Mine is located in Eastern Uganda near the towns of Mbala and Tororo, approx. 190 km from the Uganda capital, Kampala and close to the border with Kenya.

It is on major central African road and rail networks and is 10 km from a rail spur that connects to the Kenyan port of Mombasa.

The Namakera Vermiculite deposit is hosted in the Bukusu Complex, one of a number of carbonatites in the Uganda/Kenya border area and the only one known to host commercially viable vermiculite.

NMCL is the registered holder of Mining License ML 4651, upon which it operates the Namakera Vermiculite Mine and conducts exploration activities on the Busumbu Phosphate Project.

NMCL is also the registered holder of Exploration License EL 1534 that covers the majority of the Bukusu Complex and which is also considered prospective for vermiculite, phosphate, copper, iron, zircon and rare earths mineralisation.

Tenement	Interest	Area	Expiry Date	Other Conditions
Mining License ML 4651	100%	17.25 km2	14/05/24	Option to extend up to
				a further 15 years
Exploration License EL	100%	30.83 km2	23/11/17	Two options to extend
1534				each for a further 2
				years

The Bukusu Complex extends over about 50km2 and consists principally of intrusive carbonatites and silicate rocks. The complex is composed of alkaline and ultrabasic rocks forming ring dyke structures surrounding a central vent agglomerate. The Bukusu Complex is one of Africa's largest alkaline carbonatite complexes.

The Bukusu Complex is surrounded by a broad zone of feldspathisation or fenites in which leucocratic granite, syenite and quartz-pegmatoid have been developed from alteration of the granodiorite gneiss country rocks.

The vermiculite occurs within an approximately 34m thick sub-horizontal tabular zone and is derived by weathering of phlogopite within coarse-grained to pegmatoidal pyroxenite.

Vermiculite mineralisation was first discovered in the Bukusu Complex in the 1950s but commercial development only commenced in the 1990s, when TSX listed IBI Corporation conducted a series of exploration programs and commenced development of a small scale mining and vermiculite flake production plant.

The Namakera Vermiculite deposit and surrounding licenses were acquired by Rio Tinto in 2007 for C$5m and further drilling, resource definition work, pit optimisation and design, plant optimisation, transport and infrastructure studies and market research work was subsequently undertaken.

Rio Tinto completed a 64 hole RC percussion drilling program in 2007, which resulted in a 2004 JORC Code compliant Inferred Mineral Resource Estimate being released in 2008.

ASX listed Gulf Industrials Limited acquired the mining operation in 2009 from Rio Tinto.

Gulf Industrials engaged SRK Consulting East Africa in 2009 to complete a review of the resource estimates completed by Rio Tinto. The SRK review included site visits and an assessment of Rio Tinto drill samples and results at the Namakera Mine, including also a geological assessment in the pit.

The Namakera Vermiculite deposit was determined to extend from surface to a depth of between 45m to 55m.

Gulf Industrials reported on 23 July 2009 that the Namakera Vermiculite deposit contained a JORC Code 2004 Inferred Resource estimate of 54.9 Mt at a grade of 26.7% vermiculite ˃ 0.18 mm. This resource estimate had a surface extent of 1.0 km by 1.0km (location of the existing mine/pit).

JORC 2004 COMPLIANT RESOURCE – GULF INDUSTRIALS
	Million TonnesGrade > 180µmGrade > 425µm
Inferred Resources	54.9	26.7%	18.8%

Marketing Grade	Size	Distribution	Mt Vm (> 180µm)	Mt Vm (> 425µm)
Premium	>9.5mm	8%	1.2	0.8
Large	>5.6mm <9.5mm	21%	3.1	2.2
Medium	>2.0mm <5.6mm	30%	4.4	3.1
Fine	>1.18mm <2.0mm	20%	2.9	2.1
Super Fine/Micron	<1.18mm	21%	3.1	2.2
TOTAL			14.7	10.3

This information was prepared and first disclosed under the JORC Code 2004 guidelines by Gulf Industrials. This resource estimate is not the Company's and the Company is not itself making those estimates nor reporting those results. The Company has not updated this resource estimate nor done sufficient work to verify the data or resource estimate. It has not been subsequently updated to comply with the JORC Code 2012 guidelines on the basis that the information has not materially changed since it was last reported (since 2009 limited production of approx. 45,783 tonnes of vermiculite flake product >0.5mm).

Gulf Industrials recommissioned the Namakera Vermiculite Mine in 2010, achieving increased mine and plant production and increased sales through an expansion to the plant from the then-current output levels of 8,000tpa of vermiculite product. Conventional open pit "free-dig" mining methods were employed using an owner-operator standard truck and shovel operation.

Throughput and recoveries through the single stage crushing circuit, magnetic separation, air drying, two stage screening and winnowing processing plant were reported to produce up to the planned expanded steady state levels of 30,000tpa of vermiculite flake product.

Vermiculite flake product was bagged in 1.15t bulk bags and transported by road in "back-loads" to the Kenyan port of Mombasa where it was sold under a long term and exclusive offtake agreement to the European export markets.

In 2011 Gulf Industrials commenced a Bankable Feasibility Study to increase vermiculite product sales to 80,000tpa. From Gulf Industrial's disclosures on ASX, the Company understands that an in-fill drilling program, pit expansion studies and preliminary engineering work for the modular plant expansion were completed as part of this Bankable Feasibility Study in early 2012.

Between 2011 and 2013 Gulf Industrials produced and sold 42,045 tonnes of vermiculite flake product >0.5mm size into the European markets. Approximately 60% of sales were in the premium large and medium flake products at prices in excess of US$300/t with the balance of sales in the fine and super fine flake products.

The mining operation was placed on care and maintenance in late 2012, as a result of the terms of its 25 year exclusive distribution offtake agreement with a UK based group who were unable to guarantee future purchases of vermiculite flake. This agreement was subsequently terminated, following a US$1.2m termination payment to the UK based group, which allowed them to then freely market its vermiculite product independently rather than exclusively.

In 2013 Gulf Industrials' secured debt holders assumed ownership of the mining operation in exchange for approximately US$4.1m of debt forgiveness and they have maintained and operated the mine and processing plant since then.

Mining and processing operations recommenced at the Namakera Vermiculite Mine in the second half of 2013 with 2,620t of sales of vermiculite flake being made under two non-exclusive marketing agreements up to 31 December 2014.

Production continued in 2015 but was halted in February 2015 when temporary restrictions were placed on the export of a number of mineral commodities in Uganda including vermiculite. These restrictions were lifted in August 2015 and mine production and processing operations resumed and operations and export sales into existing contracts have continued since then.

In 2015 the mine produced 1,118 t of vermiculite product and recorded sales of 1,066 t of vermiculite. In the first quarter of 2016 to 31 March 2016, the mine produced 712t of vermiculite product and recorded sales of 978 t.

Current open pit mining operations are focused on a single pit approximately 1.0 km by 400m and to a maximum depth of 35 m, with bench heights of 2.5 m. Vermiculite mineralisation is excavated using conventional earthmoving equipment including excavators, front end loaders, bulldozers and tipper trucks.

The vermiculite is transported in open trucks to the processing plant located less than 1km from the mine where it is either placed on the ROM stockpile or fed directly into the process plant.

Generally, near surface ore and ore from the bottom benches is stockpiled separately from the ore that is mined from the deeper levels due to differences in colour and exfoliation rates. The ore is then blended prior to processing. In this manner, a consistent product can be produced both in terms of the product colour as well as the exfoliation ratios.

The mine is currently operating for 6 days/week on a single shift basis only and only when there is sufficient working capital to fund key consumables. During day shift, trucks tip ore directly into the ROM bin with excess production being placed upon ROM stockpiles to facilitate blending and to cater for processing when the pit is not operating.

When ore from trucks is not available the run of mine material is fed into the ROM bin by a front end loader.

Vermiculite ore from the ROM bin is conveyed to a magnetic separator which separates magnetic minerals (predominantly magnetite) from the vermiculite-bearing non magnetics and is placed them on a separate waste stockpile.

The non-magnetic, vermiculite-rich ore is then fed into a rotary dryer where the moisture content is lowered from an average +9% to less than 5%, which will allows the material to pass over screens without excessive blinding.

The resultant dry ore then passes through a bank of screens where dust is removed from the stream of ore before the ore is passed onto a circuit of screens that separates the ore into the different size fractions according to their particle size as per the table below.

	Particle Size Range	Large	Medium	Fine	Superfine
	11.2mm - 4.75mm	80%	-	-	-
Min. % by weight	4.75mm - 2.00mm	-	80%	-	-
retained in size	2.80mm – 1.00mm	-	-	80%	-
range indicated	1.70mm – 0.3mm	-	-	-	80%

The separated, different sized ore fractions are then passed through winnowers to separate the vermiculite from the none-vermiculite grit particles.

Winnowing is a gravity separation process that utilises the relative density differences between vermiculite and the waste material. Winnowing increases, the concentration of vermiculite in the product to a minimum of 95% vermiculite. Large fractions that are not saleable are recirculated through a granulator where they are reduced in size and fed back into the sizing circuit. The output from the winnowers is then screened for the final time to remove remaining dust before the ore is packed in bulk bags.

The vermiculite product is packed into 1.1 tonne bulk bags for all grades of vermiculite product, for storage and dispatching to clients. The bagged vermiculite product is loaded on 40' foot sided or container trucks at the mine site and is transported under contract to the port at Mombasa in Kenya. The bagged product is maintained in a warehouse at the port before transloading into 20-foot shipping containers.

Sales of the vermiculite product are sold under fixed price contract to customers and trading houses in Europe, Asia and Australia. Over the past 24 months, sales of vermiculite product have been made to customers in Spain, Belgium, Germany, Switzerland, Slovenia, Poland, France, Saudi Arabia, United States, Japan and Australia. The operation is currently contracted for the sale of vermiculite product to 10 customers, predominantly in Europe, Japan and Australia for amounts of up to 10,000t of a combination of large, medium, fine and superfine vermiculite product.

Subject to completion of the Transaction, the Company will immediately commence further detailed reserve and resource evaluation and drilling work. The Company and its consultants will use the results of this work to determine whether a 2012 JORC Code compliant Mineral Resource Estimate can be finalised.

The Company and its consultants have reviewed the previous exploration and drilling results upon which Rio Tinto and Gulf Industrials were able to report a JORC Code 2004 Inferred Resource Estimate and consider these estimates to be of acceptable standards and reasonable, however it cannot at this stage be assumed that the Company will be able report any resources or reserves in accordance with the 2012 JORC Code Mineral Resource Estimate Guidelines.

Subject to completion of the Transaction, the Company will immediately commence further mine optimisation studies with the objective of confirming the long term economic viability of the Namakera Vermiculite Mine and to demonstrate the economics of the resources and the proposed mine development strategy.

The Company's proposed mine development strategy will aim to increase mine production and efficiencies at the Namakera Vermiculite Mine through additional new capital investment in the mining fleet and in mine planning and the purchase of additional surface rights adjacent to the existing open pit. The purchase of the additional surface rights is not considered material to the operation's commercial viability, but is anticipated to provide greater operational flexibility. NMCL has already entered into binding agreements to acquire the additional surface rights, subject only to payment of the acquisition fee of approx. $30,000.

The new mine strategy and associated expenditure on new mining equipment and on the additional surface rights will commence immediately after completion of the Transaction and is not dependent on the completion of the Company's planned reserve and resource evaluation and drilling work.

Based on study work reviewed by the Company and completed by the current mine management, a new mine plan has been prepared. The new mine plan incorporates data based on actual historical performance and costs, the forecast efficiencies and increased mine production anticipated to be achieved from a new mining fleet and has been used as an evaluation tool to assist the Company in its plans to implement its new mine strategy.

Work completed by the Company has identified that the current mining fleet is unable to achieve the required monthly mining volume rates of 25,000t of vermiculite due to extremely low utilisation rates obtained from the mining fleet and in particular the haul trucks, which require high levels of maintenance and servicing as a result of their age and which can also not operate effectively in the open pit during the wet season, when the condition of the haul roads make ore and waste transportation difficult. It is proposed that the existing mining fleet and haul trucks are replaced by new leased or purchased mining equipment from the funds raised from the Capital Raising.

The Company believes that the funds raised from the Capital Raising and the availability of appropriately sized mining equipment that can be purchased or leased and mobilised to site in a short time frame, and availability of other key mining consumables will be sufficient for the Company to achieve the required monthly mining volume rates of 25,000t of vermiculite in the short-term.

Subject to completion of the Transaction, the Company will also immediately commence process plant optimisation studies with the objective of being able to demonstrate the economic viability of increasing process plant throughput, efficiencies and yields through capital investment in the existing process plant. The Company's consultants have set out a provisional work program for optimisation and upgrade work associated with the rotary dryer and product screening and winnowing process, as well as a program to complete essential and overdue plant maintenance work.

Work already completed by the Company and its consultants has identified that the overall operation is currently capable of only operating at steady state product sales levels of between 10,000 to 15,000tpa of vermiculite product. This is due to the constraints on mine production due to the current mining fleet and maintenance and capital works required to be completed on the process plant.

This amount (10,000 to 15,000tpa of vermiculite product) is more than the overall operation is presently producing. This is a result of the mine presently only operating for 6 days/week on a single shift basis only and only when there is sufficient working capital to fund key consumables. Work completed by the Company and its consultants has identified that the overall operation is capable of operating at steady state product sales levels of between 10,000 to 15,000tpa of vermiculite product (before upgrade of the current mining fleet and before capital works).

With the acquisition of new mining equipment, and the associated attributable increase in mine production, the overall operation is still forecast to only be able to achieve 15,000 to 20,000tpa of saleable vermiculite production.

For the overall operation to achieve the previous steady state product sales levels of 30,000tpa of vermiculite product, further capital investment and maintenance work is required to be made by the Company on the process plant. This work is planned to comprise amongst other things, installation of an impact crusher and wet screening circuit ahead of the current ROM bin; recalibration and maintenance of all the variable speed flow meters, weightometers, temperature monitors and probes to optimise and control feed rates to and from key processes; maintenance of the dust extraction system; installation of floor lifters in the rotary dryer; insulation of the rotary dryer to reduce heat loss and fuel consumption; and optimisation and simplification of the screening and winnowing process flows to eliminate overloading and additional material handling.

The Company believes that the funds raised from the Capital Raising will be sufficient for the Company to carry out this proposed optimisation and upgrade work at the process plant, as well as completing essential and overdue plant maintenance work.

Upon completion of the Transaction, the Company is proposing to commence investment in new mining fleet, capital investment and maintenance work at the process plant simultaneously with its proposed reserve and resource evaluation and drilling work., There is a risk that the Company may not be able to identify sufficient vermiculite reserve and resources to meet any increased or sustained productions and sales levels and its expenditure on new mining fleet and plant upgrades and maintenance work prior to that may not be economically recoverable.

It must be further noted, that as the Company has not yet completed sufficient work to release a 2012 JORC Code Mineral Resource Estimate nor has at present completed sufficient mine and process plant planning and optimisation study work to confirm the long term economic viability of any resources at the Namakera Vermiculite Mine it cannot be assumed that the Company will be able to achieve any increase in mine production or achieve the previous steady state product sales levels of 30,000tpa, through its proposed mine development strategy or proposed capital investment in plant optimisation and upgrade and maintenance work.

Further mine planning and optimisation studies, processing plant testwork and optimisation studies and further feasibility work will all need to be completed by the Company and the Company cannot presently say whether there is sufficient vermiculite to meet the targeted production and sales levels for any period of time.

The Company is proposing that the funds raised from the Capital Raising are to be used for the following minimum planned capital expenditure work program at the Namakera Vermiculite Mine to be implemented over the next 12 months as described in the table below.

	PROPOSED APPLICATION OF FUNDS (A$)
	Jul-Dec 2016	Jan-Jun 2017	Total
Namakera Vermiculite Drilling, Mine and	400,000	150,000	550,000
Process Plant Optimisation Studies:
 Resource and Reserve Definition Drilling
 Mine Optimisation Studies
 Process Plant Optimisation Studies
Namakera Process Plant Capital and	1,050,000	150,000	1,200,000
Maintenance Works:
 Impact Crusher and Wet Screening
 Process Controls and Instrumentation
 Rotary Dryer Capital Works
 Screening and Winnowing Capital Works
 Dust Extraction Maintenance-Upgrade
 Plant Maintenance Works
Namakera Mine Fleet and Site	850,000	-	850,000
Infrastructure Capital:
 Surface Land Rights Acquisition
 Lease and Purchase of New Mining Fleet
 Purchase of Spares and Consumables
 Construction of New Load Facility
 Installation of New Storage Facilities
Allocation of Site Administration and	450,000	-	450,000
Working Capital
TOTAL	2,750,000	300,000	3,050,000

The above table is a statement of current intentions as at the date of this Notice. Intervening events may alter the way funds are ultimately applied by the Company. The Company's existing cash at hand will continue to be spent in accordance with previous stated objectives in relation to the Company's current operations. As with any budget, intervening events and new circumstances have the potential to affect the ultimate way funds will be applied. The Board reserves the right to alter the way funds are applied on this basis. Actual expenditure may differ significantly from the above estimates due to a change in market conditions, the development of new opportunities and other factors.

The Company has an obligation to invest a minimum of US$2.5m of total expenditure commitments under the Transaction by no later than 31 December 2016, and US$5.0m by April 2019.

The minimum planned capital expenditure work program above, together with the minimum planned capital expenditure work program at the Busumbu Phosphate Project, and approx $371,000 of costs incurred up to 30 June 2016 by the Company in respect to the Transaction will satisfy the Company's minimum US$2.5m expenditure commitment required by 31 December 2016.

The Company will need to expend further funds to satisfy the Company's minimum expenditure commitments under the Transaction over the approx. 3-year period up to April 2019. It is the Company's present intent to meet this further funding obligation from forecast free cash flow, however if there is insufficient free cash flow to meet this requirement for any reason, then the Company may need to seek additional debt or equity funding to be able to satisfy the minimum expenditure commitment.

In order to operate the Namakera Vermiculite Mine at the design capacity of 30,000tpa of vermiculite product for any sustainable period of time, the Company will also need to increase the volume of vermiculite sales that are sold under fixed price contract to customers and trading houses in Europe, Asia, the United States, Middle East and Australia.

The Company already has existing sales contracts in place over the next 12 months for the sale of up to 10,000tpa vermiculite product to 10 customers, predominantly in Europe, Japan and Australia. The Company has already further received non-binding sales enquiries and expressions of interest from a major global marketing and trading group for up to 30% of the Company's total planned vermiculite sales, for a further 12,000tpa of sales into the United States from a South African based industrial minerals trading group, and 6,000tpa of sales into the United Kingdom and Europe and several other expressions of interests from potential customers in the United States, the Middle East and Australia.

The Company also plans to strengthen its sales and marketing team, and in addition to appointing new sales agents in the United States, Europe, the Middle East and Asia it will also appoint Mr. Simon Grant Rennick as Director Sales and Marketing. Mr Grant-Rennick will be responsible for the negotiation and sale of the Company's vermiculite product sold under contract globally and for the operation of the Company's sale and marketing of its vermiculite product. Mr Grant-Rennick is a mining engineer with over 38 years' experience in exploration, mining and mining geology specialising in industrial minerals. He is also the principal of a UK based industrial minerals consultancy group providing specialist operations, investment and financial analysis and advice with particular focus on the sales and marketing of industrial minerals. Mr Grant-Rennick has owned and managed vermiculite mining and marketing operations in the United States.

There is no guarantee or assurances that the Company will be able to negotiate new sales contracts for the proposed increased level of vermiculite sales at commercially acceptable vermiculite prices. If the Company is not able to negotiate new and increased sales contracts with its customers over sufficient sales volumes and at commercially acceptable vermiculite prices, it could result in reduced sales volumes or prices.

b. The Company has not yet completed sufficient work to release a 2012 JORC Code Mineral Resource Estimate nor has at present completed sufficient mine and process plant planning and optimisation study work to confirm the long term economic viability of any resources at the Namakera Vermiculite Mine. There is no guarantee or assurances that the Company will be able to produce vermiculite to satisfy existing and proposed sales contracts.Busumbu Phosphate Project

Detailed technical information on the Busumbu Phosphate Project is included in Section 4.7 of the Independent Technical Valuation included in this Notice of Meeting.

The Busumbu Phosphate Project is located on the Busumbu ridge approximately 1km south east of the Namakera Vermiculite Mine and on the existing Mining License held.

Phosphate rocks from Busumbu were mined between 1944 and 1963 from small open pits along Busumbu ridge. Until 1956 the 'hard' phosphate rock was excavated, crushed and screened before being exported to Kenya for the manufacture of citric-soluble soda phosphate fertilizer using sodaash from Lake Magadi. The undersized, fine phosphatic material was used as direct application fertilizer. From 1956 onward the customer requirement changed and 'hard' phosphate rock was replaced by a blend of soft phosphate rock with a P205 content of 15% P205 and hard phosphate with a P205 content of 30%. This phosphate blend was upgraded using magnetic separation techniques.

The annual production of Busumbu reached 6,000 tonnes and a total of 62,000 tonnes of phosphate concentrate was produced over the period that the mine was in operation.

The Busumbu Phosphate deposit, is a residual fluoro-apatite deposit overlying a carbonatite lithology which is presumed to be the source of the phosphate. The deposit consists of a hard rock and a soft rock category. Soft rock refers to the phosphate in residual soils and saprolite and has reported grades of 5% to 15% P2O5. The hard rock refers to a re-cemented deposit, the cement being secondary phosphate minerals. The primary and secondary apatite differs slightly in composition with the primary apatite being the higher grade. In total the hard rock deposit has reported grades of 25% to 35% P2O5 The source of these reported grades is historical work completed by a joint team from the Department of Geological Survey and Mines and the United Nationals Department for Development Support and Management and supported by the sampling and diamond drilling results released by Gulf Industrials on 26 November 2012.

Exploration work was completed by Gulf Industrials at the Busumbu Phosphate Project in 2011 and 2012. The work comprised soil sampling to delineate the potential mineralised target, followed by six diamond drill holes to test for depth extent, determine tenor of phosphate mineralisation and to identify phosphate minerals present.

Analyses of the soil samples by Gulf Industrials in 2011 and 2012 identified potential of up to 3km of strike extent of phosphate mineralisation between the Busumbu Phosphate Project and the Namakera Vermiculite Mine. It also indicated a "substantial phosphate mineralisation footprint for future exploration." These exploration results were reported by Gulf Industrials in an ASX release dated 21 June 2012 "High Grade Phosphate Mineralisation Presence Confirmed".

Gulf Industrials provided the results of the six hole diamond drill program an ASX release dated 26 November 2012 "Confirmation of High Grade Phosphate Discovery – Busumbu". The results enabled Gulf to estimate "the potential dimensions of the prospect to be in excess of 3km by 400 m" and the drilling "confirms high-grade mineralisation to a depth of over 60 m with assay grades of up to 30.5% P2O5."

These exploration results are not the Company's and the Company is not itself making these exploration results nor reporting those results. The Company has not done sufficient work to verify the data or exploration results. The reported historical resource estimates and associated historical exploration targets included in the Independent Technical Valuation and referenced above in this Notice of Meeting have been completed over a period from 1942 to 2012 and have included pitting and trenching, sampling, surface mapping, geochemical and aeromagnetic surveys and RC drilling and small scale mining activities. These are not reported in accordance with the JORC Code 2012. A competent person has not done sufficient work to classify the historical estimates as mineral resources or ore reserves in accordance with the JORC Code 2012 and it is uncertain that following evaluation and/or further work by the Company that the historical estimates or exploration targets will be able to be reported as mineral resources or ore reserves in accordance with the JORC Code 2012,

Subject to completion of the Transaction, the Company is proposing to complete further detailed exploration work at the Busumbu Phosphate Project including, resource definition drilling preliminary mine planning and optimisation studies, broad sampling and metallurgical test work and preliminary processing plant optimisation studies. This work is proposed to be completed over an initial period of 12 months and a budgeted amount of $550,00 has initially been allocated towards this work. The Company and its consultants have reviewed the previous historical exploration work undertaken including the work undertaken by Gulf Industrial and considers that this work to be of acceptable standards and reasonable, however it cannot at this stage be assumed that the Company will be able to report any resources in accordance with the 2012 JORC Code Mineral Resource Estimate Guidelines following completion of its planned drilling program.

The Busumbu Phosphate Project is considered to be one of two "world-class" phosphate deposits in Uganda and is a key focus of the Company. The Company is further proposing to commence a pre-feasibility study in 2016, upon completion of an initial drilling program, and anticipates completing this study late in 2016.

The Company and its consultants have reviewed previous historical exploration work undertaken including the work undertaken by Gulf Industrial and considers that this work to be of acceptable standards and reasonable, however it cannot at this stage be assumed that the Company will be able to report any resources in accordance with the 2012 JORC Code Mineral Resource Estimate Guidelines following completion of its planned drilling program.

The Company is proposing that the funds raised from the Capital Raising are presently intended to be used for the following minimum capital expenditure work program as described in the table below.

PROPOSED APPLICATION OF FUNDS (A$)
Jul-Dec 2016Jan-Jun 2017Total
Busumbu Phosphate Project:	450,000	100,000	550,000
 Sampling and Surveying
 Resource Definition Drilling
 Scoping and Pre-Feasibility Studies
Allocation of Site Administration and150,000-150,000
Working Capital
TOTAL	600,000	100,000	700,000

The minimum planned capital expenditure work program above, together with the minimum planned capital expenditure work program at the Namakera Vermiculite Mine, will satisfy the Company's minimum US$2.5m expenditure commitment required by 31 December 2016.

1.2 Requirement for Shareholder Meeting

Of the Resolutions, the Resolutions required for the approval of the Transaction are Resolutions 1 to 6 and 10 (Transaction Resolutions). The Transaction is explained in this Explanatory Memorandum and the Independent Expert's Report.

Before deciding whether to approve the Transaction Resolutions, you should read this Explanatory Memorandum and the Independent Expert's Report.

1.3 Parties and Roles

The key parties to the Transaction are:

Party	Role	Abbreviation
African Phosphate Pty Limited	Holder of the right to acquire all	AP
	the shares in Gulf and currently
	overseeing all management and
	operation of NMCL and its key
	mining projects (being the
	Namakera Vermiculite Mine and
	Busumbu Phosphate Project).

	Sells this right to the Company (sothat the Company can acquire allthe shares in Gulf).
GLF Holdings Limited	Corporate parent of IMIC andNMCL.To be acquired by the Company.	Gulf
Industrial Minerals InternationalCorp	Subsidiary of Gulf.	IMIC
Namakera Mining CompanyLimited	Subsidiary of Gulf.Owner of Namakera VermiculiteMine and Busumbu PhosphateProject.	NMCL
Jonah Resource Holdings	Shareholder of GLF.Vendor of GLF shares to theCompany.	JRH
Richmond Partners MastersLimited	Shareholder of GLF.Vendor of GLF shares to theCompany.	RPM
LB International Limited	Related party of RPM.Provided services to the Companyin relation to the Share SaleAgreement.Provided working capital to NMCL.	LBI

The Shareholders of African Phosphate are:

Shareholder	Shares Held	Percentage Held
CoLab Theory Pty Limited	55	29.73%
Davy Corp Pty Ltd ATF the Davy Investment Trust	25	13.51%
Alpha Corporate Services (Bermuda) Limited (anentity associated with Simon Grant-Rennick)(Alpha)	17.5	9.46%
Langleycourt Properties Limited (an entityassociated with Simon Grant-Rennick)(Langleycourt)	17.5	9.46%
Elite Sky Investment Limited	15	8.11%
JC Trust Pty Limited (an entity associated withJason Brewer) (JC)	55	29.73%
Total:	185	100.00%

The Shareholders of GLF Holdings Limited are:

Shareholder	Percentage Held
Richmond Partners Masters Limited	81.81%
Jonah Resources Holdings Limited	18.19%
Total:	100.00%

1.4 Summary of the Transaction

(a) Composition of Transaction

Summary of Transaction flows

Transferor	Transferee	Transfer	Basis	Value
Company	AP, JC,Langleycourtand Alpha	18,500,000 APAgreementShares	To acquire AP'sright to buy 100%of the shares inGLF.	$nil (on the basis setout in theIndependentExpert's Report).$1,850,000 (ifadopting the pershare price underthe Capital Raising).
Company	Corporate andTechnicalAdvisors of AP	Royalty	To repay therecipients forservices providedto AP.Being paid by theCompany as partof the Companyacquiring AP'sright to buy 100%of the shares inGLF.	US$1,000,000(estimateddiscounted value,refer to page 12 ofthe IndependentExpert's Report).
Company	JRH, RPM, LBI	33, 190,380ConsiderationShares	To acquire 100%of the shares inGLF.	$nil (on the basis setout in theIndependentExpert's Report).$3,319,038 (ifadopting the pershare price underthe Capital Raising).
Company	Gulf	US$5,000,000	To be investedinto Gulf overtime	US$5,000,000
Company	JRH, RPM	US$250,000	Payment if theCompany fails toinvest therequired amountinto Gulf (as longas the vendorsretain at least50% of theConsiderationShares).	US$250,000
JRH, RPM	Company	DebtUS$13,784,554	Assignment tothe Company ofthe shareholderdebt owed toJRH and RPM byGulf.	US$13,784,554(however, this willbe a debt owed tothe Company by awholly ownedsubsidiary)
Company	LBI	US$3,000,000and interest ata 5%cumulativeannual rate	Advisory Fee	US$3,000,000 andinterest at a 5%cumulative annualrate.

		18
Company	LBI	US$120,000	Payment of	US$120,000
			Working Capital
			Fee owed to LBI
			by NMCL

The material terms of the Transaction are:

AP Agreement

(i) AP holds the right to acquire Gulf (and so obtain a 100% interest in NMCL) from Gulf's shareholders, being JRH and RPM (AP Agreement).
(ii) Subject to the passing of the Transaction Resolutions, the Company will acquire this right from AP by issuing a total of 18,500,000 AP Agreement Shares to AP and its nominees.
(iii) AP has nominated that these 18,500,000 AP Agreement Shares be issued as follows:
- (A) 9,500,000 AP Agreement Shares to AP;
- (B) at AP's request, 5,500,000 AP Agreement Shares to JC (or its nominees); and
- (C) at AP's request, 3,500,000 AP Agreement Shares to Langleycourt and Alpha (or their nominees).

Royalty

(iv) AP was assisted to enter into the AP Agreement by various corporate and technical advisors, who provided financial assistance, technical assistance and corporate advisory services to AP in relation to the Transaction. As part of acquiring the benefit of the AP Agreement from AP, the Company has entered into a deed with corporate and technical advisors of AP, pursuant to which, in consideration for financial assistance, technical assistance and corporate advisory services provided to AP in relation to the Transaction, the Company will pay those advisors a royalty equal to 1% of all sales revenue generated from mineral production by NMCL up to the period ending 31 December 2026 (Royalty). Two beneficiaries of the Royalty (intended to hold a 20% interest) will be Langleycourt and Alpha, which are associated with Simon Grant-Rennick (who is proposed to be elected as a Director of the Company pursuant to Resolution 8). The Royalty beneficiaries will be:

Name	Pro Rata Share of Royalty
CoLab Theory Pty Limited	20%
PO Box 98415, Sloane Park, Johannesburg, South Africa
2152
Davy Corp Pty Ltd ATF the Davy Investment Trust	20%
29 Coldwells Street, Bicton, WA 6157
Alpha Corporate Services (Bermuda) Limited	10%
29 Coldwells Street, Bicton, WA 6157
Langleycourt Properties Limited (an entity associated with	10%
Simon Grant-Rennick)
Suite F9, Waterside Centre, Lewes, East Sussex BN7 2PE
Elite Sky Investment Limited	40%
Unit B, 11/F Prince Industrial Building, Prince Edward Road
East, Kowloon, Hong Kong
Total:	100%

(v) The Company has entered into a share sale agreement with JRH and RPM pursuant to which JRH and RPM have agreed to sell and the Company has agreed to purchase all the shares in Gulf (Share Sale Agreement);
(vi) Pursuant to the Share Sale Agreement, the Company has agreed to:
- (A) issue 33,190,380 Consideration Shares to JRH and RPM or their nominees as follows:
  - (I) JRH, 4,978,803 Consideration Shares;
  - (II) RPM, 27,641,577 Consideration Shares; and
  - (III) LBI (a related party of RPM), 570,000 Consideration Shares,
- (B) invest a total of US$5,000,000 into Gulf, with US$2,500,000 of that amount being invested by 31 December 2016 and the remainder within 3 years of the date of the Share Sale Agreement, being 3 April 2019;
- (C) in the event the Company does not make the investment described in section 1.3(a)(vi)(B) above, make an additional cash payment to JRH and RPM of US$250,000. The cash payment will only be payable if the vendors continue to hold at least 50% of the Consideration Shares on the third anniversary of the date of the Share Sale Agreement, being 3 April 2019; and
- (D) complete the Capital Raising with binding commitments for equity capital of no less than $4,500,000;

Deed of Assignment of Debt

(vii) The Company has entered into a deed of assignment of debt with JRH and RPM pursuant to which JRH and RPM have agreed to jointly and severally assign to the Company all of their rights, title and interest to the debt owed to them by Gulf (Debt) (Deed of Assignment of Debt). After the assignment, Gulf will owe this amount to the Company. The present amount of the Debt is approximately US$13,784,554. The Company is seeking tax advice and sign off from its tax advisors as to how this Debt is to be classified after Completion. At this stage it represents an inter-company loan and an amount that is due to the Company by Gulf;

Payment to LBI

(viii) LBI advised and assisted the Company in the settlement of the Share Sale Agreement. The Company has entered into a deed with LBI pursuant to which, in consideration of the services provided by LBI, the Company has agreed:
- (A) to pay LBI a transaction fee of US$3,000,000 cash to be paid on a deferred basis quarterly in arrears, with each quarterly payment amount calculated as an amount equal to 66% of NMCL and IMIC's net cashflow after-tax (Advisory Fee). If the transaction fee is not paid in full by 30 June 2019 then subject to obtaining shareholder approval at the time the outstanding balance will automatically convert into Shares which will be issued to LBI at an issue price equivalent to the VWAP for the 6 months prior to the last date due for payment and will be issued within 30 Business Days. The Advisory Fee will accrue interest at a 5% cumulative annual interest rate; and
- (B) to reimburse LBI, by no later than 1 July 2016, an amount of US$120,000 to settle funds and associated interest and penalties fees, advanced by LBI (Working Capital Fee) to NMCL.

(b) Directors

The current Directors are Jason Brewer, John Ryan and Julian Ford. As notified to ASX on 13 April 2016, Julian Ford has been appointed a Director but is due to be elected pursuant to Resolution 9 and in accordance with the Constitution.

Subject to Completion and the passing of the relevant resolutions, the Board of the Company will be re-structured so that immediately following Completion, the Board shall consist of:

Julian Ford as an independent non-executive Chairman of the Board;
Jason Brewer as an Executive Director;
Simon Grant-Rennick as an Executive Director;
John Ryan as a Non-Executive Director; and
Luca Bechis as a nominee Director of RPM.

Some details of the proposed new Directors are set out below at section 7.

(c) Conditions

Completion of the Transaction is subject to the following key conditions:

(i) the Company obtains all required Shareholder approvals;
(ii) the Capital Raising is completed and raises a minimum of $4,500,000;
(iii) the Company obtains all required regulatory approvals pursuant to the ASX Listing Rules, Corporations Act and other applicable laws or regulations in connection with the Transaction; and
(iv) the various transaction documents remain binding and in full force and effect and none of them are terminated.

1.5 Pro forma balance sheet

An audit reviewed balance sheet (statement of financial position) and pro-forma consolidated balance sheet of the Company is set out below.

		Pro-forma
	31 March 2016	31 March 2016
	(A$'000)	(A$'000)
Current Assets
Cash Assets	1	2,710
Receivables and Prepayments	4	465
Inventory at Cost	-	169
Total Current Assets	5	3,344
Non Current Assets
Plant and Equipment	-	712
Loan to NMCL	125	-
Capitalised Exploration Costs	-	37,840
Total Non-Current Assets	125	38,552
Total Assets	130	41,896
Current Liabilities
Trade and Other Payables	2,331	1,276
Other Unsecured Borrowings	89	-
Interest Bearing Liabilities - Secured	90	-
Interest Bearing Liabilities - Unsecured	2,643	-
Royalty and Advisory Fee Liabilities	-	92
Total Current Liabilities	5,153	1,368
Non-Current Liabilities
Environmental Provision	-	41
Royalty Liability	-	1,300
Advisory Fee Liability	-	4,177

Deferred Income Tax	-	11,013
Total Non-Current Liabilities	-	16,531
Total Liabilities	5,313	17,899
Net Assets (Liabilities)	(5,023)	23,997
Equity
Issued Capital	23,627	34,243
Reserves	3,385	3,475
Accumulated Losses	(29,687)	(11,373)
Parent Interest	(2,675)	26,345
Non-Controlling Interests	(2,348)	(2,348)
Total Equity (Deficiency)	(5,023)	23,997
Shares On Issue
(Pre-Consolidation)	410,515,820	N/A
(Post Consolidation)	41,051,582	152,198,797
Net Asset Backing Per Share (cents)	nil	15.76

Notes:

The pro forma Statement of Financial Position of the Company as at 31 March 2016 assumes the followings:

(a) Completion of the 1 for 10 share capital consolidation of the Company;
(b) Completion of the Offer of 45,000,000 Shares pursuant to this Prospectus to raise $4,500,000 and incurring of New Capital Raising costs of say $455,000.;
(c) Completion of the acquisition of all of the shares in GLF by way of an issue of 33,190,380 Consideration Shares and 18,500,000 AP Agreement Shares (deemed booked accounting cost approximately $5,169,038 that assumes inter-alia that the market value of the Company's shares approximates 10.0 cents (being the proposed Offer Price) and applying fair values to the assets and liabilities of the GLF Group (including ascribing a fair value to the mineral tenements of NMCL of $37,840,000);
(d) The issue of 15,474,800 Debt Conversion Shares at 10 cents each ($1,547,480) and 2,500,000 Options exercisable at 12.5 cents each by 30 June 2018 with a deemed fair value of $90,475, to eliminate principal and interest amounts due to debt providers and others creditors and the forgiveness of principal and interest and amounts of $758,957;
(e) The assignment to the Company of the debt due to GLF of US$13,014,198 (approximately $18,121,838) and accounting for a gain;
(f) As a result of fair valuing the interest in Mining Assets under the business combination accounting standard to the preferred fair value of $37,840,000 as compared with the written down cost of $1,130,000, the uplift is $36,710,000 and a deferred tax liability of $11,013,000 (at 30% of $36,710,000) is required to be accounted for. As the $37,840,000 is amortised on production, the deferred tax liability is reduced by debiting the deferred tax liability and crediting the income statement as a tax credit so that over time the deferred tax liability reduces to $nil;
(g) The raising of a liability in relation to the Advisory Fee commitment to LBI of US$3,000,000 (approximately $4,177,000) of which an estimated $nil is current and $4,177,000 is noncurrent;
(h) The raising of a liability in relation to the Royalty at an estimated discounted value of US$1,000,000 (approximately $1,392,000) of which approximately $92,000 is current and the balance of $1,300,000 as non-current;
(i) The write back of amounts initially claimed for services by Peter Landau and his associated companies, to the extent of $1,235,895; and
(j) the cash repayment of creditors and principal and interest amounts due to debt providers of $1,036,844.

1.6 Pro forma capital structure

The pro forma capital structure of the Company on completion of the Transaction is set out below. Additional information is also provided showing the capital structure of the Company assuming all Resolutions in the Notice of Meeting are approved, the Consideration Shares, AP Agreement Shares, New Shares and Debt Conversion Shares are issued, and no further issues are made prior to conversion.

The Company anticipates that all of the Consideration Shares and AP Agreement Shares (some 51,690,380 shares, representing approximately 33.74% of the shares on issue) will be required to be subject to a 12 month escrow period by ASX.

Description	Ordinary Shares	Options
Current Issued Capital	410,515,820	4,500,0001
Consolidation of Capital2	41,051,582	450,000
Issue of Consideration Shares3	33,190,380	-
Issue of AP Agreement Shares4	18,500,000	-
Issue of New Shares5	45,000,000	-
Issue of Finance Options6	-	2,500,000
Issue of Debt Conversion Shares7	15,474,800	-
Issued Capital on Completion of Transaction	153,216,762	2,950,000

Notes:

The terms of the existing Options are as follows:

500,000 unlisted options exercisable at A$0.25 on or before 25 July 2016

1,00,000 unlisted options exercisable at A$0.10 on or before 30 November 2016

3,000,000 unlisted options exercisable at A$0.12 on or before 31 March 2017

1. Refer to Resolution 1
1. Refer to Resolution 3
1. Refer to Resolutions 4, 5 and 6.
1. Refer to Resolution 9.
1. Refer to Resolution 11. The Finance Options are exercisable at A$0.125 on or before 30 June 2018
1. Refer to Resolution 12.

1.7 Dilution Due to Transaction

Shareholders should be aware that if the Transaction Resolutions are approved, current Shareholders' shareholdings in the Company are likely to be diluted. The table below illustrates the dilutive effect of the issues of Shares pursuant to the Transaction (Transaction Shares) for a range of hypothetical Shareholders with different shareholdings, assuming they do not participate in the Capital Raising.

Holder	Pre-Transaction1		Post Transaction2
	Holdings	% Holding	Holdings	% Holding
Shareholder 1	10,000,000	2.44%	1,000,000	0.64%
Shareholder 2	5,000,000	1.22%	500,000	0.32%
Shareholder 3	2,000,000	0.48%	200,000	0.13%
Shareholder 4	1,000,000	0.24%%	100,000	0.06%
Shareholder 5	500,000	0.12%	50,000	0.03%

Notes:

Upon the issue of all Shares the subject of the Resolutions the issued capital of the Company will be 153,216,762 ordinary shares.

1.8 Advantages of the Transaction

The Directors are of the view the Transaction will result in the following non-exhaustive list of advantages, which may be relevant to a Shareholder's decision on how to vote on the Transaction Resolutions:

(a) the Transaction represents an opportunity for the Company to invest in vermiculite and phosphate exploration, development and mining and processing assets to increase the value of the Company;
(b) the Transaction represents an opportunity for the Company to invest in assets that have historical production and exports sales;
(c) the Transaction represents an opportunity for the Company to assume control of an operating mining and processing operation with established international customers for the purchase of its saleable product;
(d) the Transaction brings to the Company a well-credentialed operations management team with experience in exploration, development and mining and processing in Uganda;
(e) the Company will retain its current interest in its US Silver Projects;
(f) the Transaction represents an opportunity for the Company to reduce its interest and interest bearing liabilities with agreement reached with the Company's lenders to convert a significant portion of amounts owed into shares in the Company if the Transaction is approved by Shareholders;
(g) the up-front consideration for the Transaction is comprised of Shares, thereby conserving the Company's cash reserves;
(h) the issue of the Consideration Shares and AP Agreement Shares will result in an increased market capitalisation which, combined with the Transaction, may assist the Company to raise funds in the future to further its operations; and
(i) some value will be preserved for Shareholders. While the Transaction may result in the dilution of existing shareholdings, the Directors consider that if the Transaction does not proceed, the Company is unlikely to be able to source adequate funds to meet its working capital requirements and repayment of interest and interest bearing liabilities.

1.9 Disadvantages of the Transaction

The Directors are of the view the following non-exhaustive list of disadvantages may be relevant to a Shareholder's decision on how to vote on the Transaction Resolutions:

(a) the Transaction may result in diluting the current Non-Associated Shareholders' interest in the Company from 100% to as little as 26.5%;
(b) the Company will, in addition to its focus on silver projects in the United States, be focused on vermiculite and phosphate exploration, development and mining and processing activities in Uganda, which may not be consistent with the objectives of all Shareholders;
(c) the Company will commence exploration, development and mining and processing activities in Uganda which is considered to have high political and sovereign risk and where changes in legislative and administrative regimes, taxation laws, interest rates, other legal and government policies in Uganda including the granting or withdrawal of licenses and permit may have an adverse impact on the performance of the Company;
(d) the vermiculite and phosphate exploration, development and mining and processing in Uganda may not turn out to be commercially viable as a result of various factors which may

include: the Company not identifying sufficient economically recoverable reserves and resources of vermiculite or the required development capital not being available or not being available on terms which allow the Company to make a profit and thus losses may be incurred. In general terms, investments in listed exploration and mining companies should be considered highly speculative;

(e) the Company's future revenues and cash flows are to be derived from the sale of vermiculite product under contracts that are determined by direct negotiations with customers and are by nature fixed price and fixed term. If the Company is not able to negotiate sales contracts with new or existing customers at sufficient sales volumes and at profitable vermiculite prices then they could materially impact on the Company's competitive position or ability to derive profits;
(f) the Company's exploration commitments, planned expenditures and expenditure obligations under the Transaction are quite high, and should commercial minerals and phosphate be proven, proceeding to development or increase production (in the case of the Namakera Vermiculite Mine) may require significant additional capital which could dilute current shareholders even further; and
(g) there is no guarantee that, as a result of completion of the Transaction, the trading price of the Shares will increase or retain value.

1.10 Plans for the Company if the Transaction is not approved

If the conditions to the Transaction are not satisfied or are waived, including if the Transaction Resolutions are not passed by Shareholders, the Transaction will not proceed and the Company will continue in its current form as a resources exploration and mining company focussed on advancing its interest in its US Silver Projects.

The Company will continue to seek to identify other resource opportunities, projects and acquisitions that may complement its existing exploration and mining focused activities and create value for Shareholders and improve the Company's current financial position.

The Company is confident in the long term value of its interest in its Conjecture Silver Project which it believes offers a potential to return value to Shareholders in the event that there is a sustained and material improvement in the current silver price. However, the Company is mindful of the requirement for further exploration drilling activity and development studies in order to advance the Conjecture Silver Project and will continue to assess the silver market and enact these activities when prudent.

The Company has reached agreement with its lenders, who are owed approximately $2,642,834 in interest and interest bearing liabilities as at 31 December 2015, to waive accrued interest of approximately $703,175 and convert approximately $971,176 of interest and interest bearing liabilities into Shares if the Transaction is approved by Shareholders. In the event that the Transaction is not approved by Shareholders, then the Company must either satisfy these interest and interest bearing liabilities obligations by way of a cash repayment or agree a further restructure. The Company will also need to source additional funds to meet its working capital requirements. There are no assurances that the Company will be able to achieve this.

1.11 Competent Persons Statement and Listing Rule 5.12 Disclosures

The Independent Technical Valuation accompanies and forms part of this Notice of Meeting sent to Shareholders.

The Independent Technical Valuation has been prepared by Allen J. Maynard and Garry R. Hemming. Neither of Mr. Maynard or Mr. Hemming are employees of the Company or any related party. Mr. Maynard is the Principal of AM&A, a qualified geologist, a Member of the Australasian Institute of Mining & Metallurgy ("AusIMM") (# 104986) and a Member of the Australian Institute of Geoscientists ("AIG" #2062). Mr. Maynard has had over 35 years of continuous experience in mineral exploration and evaluation and more than 30 years' experience in mineral asset valuation.

Mr. Hemming, BAppSc(AppGeol), MAusIMM, is a geologist with over 40 years in the industry and 30 years in mineral asset valuation. Mr Hemming is employed by AM&A. Both Mr. Maynard and Mr. Hemming hold the appropriate qualifications, experience and independence to qualify as an independent "Expert" and "Competent Person" under the definitions of the Valmin Code.

The information in the Independent Technical Valuation report and this Notice of Meeting that relates to a JORC Code 2004 Inferred Mineral Resource for the Namakera Vermiculite Mine was prepared and first disclosed under the JORC Code 2004 guidelines by Gulf Industrials and announced to ASX on 23 July 2009. This previous resource estimate is not the Company's and the Company is not itself making those estimates nor reporting those results. The Company has not updated this resource estimate nor done sufficient work to verify the data or resource estimate. It has not been subsequently updated to comply with the JORC Code 2012 guidelines on the basis that the information has not materially changed since it was last reported (since 2009 limited production of approx. 45,783 tonnes of vermiculite flake product >0.5mm).

The information in the Independent Technical Valuation report and the information in this Notice of Meeting that relates to the Namakera Vermiculite Mine and the Busumbu Phosphate Project is based on and fairly represents, information and supporting documentation prepared by Mr Maynard and Mr Hemming.

The Company has obtained the prior written consent of Mr Maynard and Mr Hemming to the form and context in which the information is presented in the Notice of Meeting and the Independent Technical Valuation report.

Previous Namakera Estimate

The Independent Technical Valuation report refers to an previous estimate for the Namakera Vermiculite Mine prepared under the JORC Code 2004 guidelines by AM&A for Gulf Industrial in an Independent Technical Valuation completed in 2013. It has not been subsequently updated to comply with the JORC Code 2012 guidelines on the basis that the information has not materially changed since.

The previous estimate does not use categories of mineralisation other than those defined in Appendix 5A (JORC Code).

The previous estimate is relevant and material to the Company in that it has been used in the preparation of the Independent Technical Valuation and forms part of valuation of the Namakera Vermiculite Mine. The previous estimate represents 3.2% of the total value assigned to the Namakera Vermiculite Mine.

The potential quantity and grade of the previous estimate is conceptual in nature. A Competent Person has not done sufficient work to classify the previous estimate as mineral resources or ore reserves in accordance with the JORC Code 2012 and it is uncertain that following evaluation and/or further work by the Company that the previous estimate will be able to be reported as mineral resources or ore reserves in accordance with the JORC Code 2012. The Company has not updated the previous estimate nor done sufficient work to verify the data.

The previous estimate was based on exploration work and drilling programs set out in detail in the Independent Technical Valuation. This included work completed by Rio Tinto between 2007 and 2008 that included drilling of 72 vertical RC drill holes totalling 3,490m to depths of 40- 60m at spacing of 50-15 m. Of this drilling program 6 holes, NAM029 to NAM034 and NAM037 were drilled to test the occurrence of vermiculite outside the area upon which the JORC Code 2004 Inferred Mineral Resource had been determined and within the previous estimate area. It also included reexamination and logging of previously excavated small pits located in several areas north of the existing open pit and within the previous estimate area. It also included exploration work and drilling programs completed by Gulf Industrial between 2010 and 2012 that included drilling of 54 drill holes totalling 3,408m that were drilled at an angle of between 50 and 55 degrees off horizontal and the directions of drilling were 29 and 205 degrees on average.

The Company does not have any more recent relevant estimates or data other than as set out in the Independent Technical Valuation report.

The Company is proposing to complete further exploration and resource definition drilling at the Namakera Vermiculite Mine as well as further preliminary mine planning and optimisation studies, broad sampling and metallurgical test work and processing plant optimisation studies. This work is proposed to be completed over an initial period of 12 months and a total budgeted amount of up to $550,000 has initially been allocated towards this work, which will be funded by the Capital Raising. The Company notes that it remains uncertain that following this additional evaluation work by the Company that the previous estimate will be able to be reported as mineral resources or ore reserves in accordance with the JORC Code 2012.

The previous estimate is a previous estimate only and is not reported as mineral resources or ore reserves in accordance with the JORC Code 2012. A competent person has not done sufficient work to classify the previous estimate as mineral resources or ore reserves in accordance with the JORC Code 2012 and it is uncertain that following evaluation and/or further work by the Company that the previous estimate will be able to be reported as mineral resources or ore reserves in accordance with the JORC Code 2012.

Busumbu Historical Estimate Disclosure

The information in the Independent Technical Valuation report and this Notice of Meeting that relates to a historical estimate for the Busumbu Phosphate Project was estimated by Katto Edwards in 1995. It has not been subsequently updated to comply with the JORC Code 2012 guidelines on the basis that the information has not materially changed since.

The Independent Technical Valuation report also refers to other historical estimates, as set out in the Independent Technical Valuation report, for the purpose of summarising work done on the deposit.

The historical estimate does not use categories of mineralisation other than those defined in Appendix 5A (JORC Code).

The historical estimate is relevant and material to the Company in that it has been used in the preparation of the Independent Technical Valuation and forms part of valuation of the Transaction and represents 19.7% of the total valuation amount.

The potential quantity and grade of the Exploration Target is conceptual in nature. A Competent Person has not done sufficient work to classify the historical estimate as mineral resources or ore reserves in accordance with the JORC Code 2012 and it is uncertain that following evaluation and/or further work by the Company that it will be able to be reported as mineral resources or ore reserves in accordance with the JORC Code 2012. The Company has not updated the historical estimates nor done sufficient work to verify the data.

The historical estimates were based on exploration work and drilling programs set out in detail in the Independent Technical Valuation. The historical estimate was estimated by Katto Edwards in 1995 and was determined based on trenching, sampling, surface mapping, geochemical and aeromagnetic surveys and RC drilling programs and mining and processing activities that had been completed at the Busumbu Phosphate Project since 1942. Further information as to this is as set out in the Independent Technical Valuation report.

Work completed by Gulf Industrials in 2011 and 2012 at the Busumbu Phosphate Project included 510 soil samples along approx. 4km of strike and six diamond drill holes totalling 301m that inter alia confirmed historical exploration results and averaged 34.8m grading 21.48% P2O5. The thicknesses of mineralisation in the drilling varied from several layers of 3m thickness to a massive The Company is proposing to complete sampling and surveying, resource definition drilling and scoping and pre-feasibility studies at the Busumbu Phosphate Project studies. This work is proposed to be completed over an initial period of 12 months and a total budgeted amount of up to $550,000 has initially been allocated towards this work, which will be funded by the Capital Raising. The Company notes that it remains uncertain that following this additional evaluation work by the Company that the Exploration Target will be able to be reported as mineral resources or ore reserves in accordance with the JORC Code 2012,

The historical estimates are historical estimates and are not reported in accordance with the JORC Code 2012. A competent person has not done sufficient work to classify the historical estimates as mineral resources or ore reserves in accordance with the JORC Code 2012 and it is uncertain that following evaluation and/or further work by the Company that the historical estimates or exploration targets will be able to be reported as mineral resources or ore reserves in accordance with the JORC Code 2012.

Statement in relation to Historical Estimates

Mr. Maynard and Mr. Hemming state that the information in the Independent Technical Valuation report is an accurate representation of the available data and studies for the Namakera Vermiculite Mine and Busumbu Phosphate Project. Neither of Mr. Maynard or Mr. Hemming are employees of the Company or any related party. Mr. Maynard is the Principal of AM&A, a qualified geologist, a Member of the Australasian Institute of Mining & Metallurgy ("AusIMM") (# 104986) and a Member of the Australian Institute of Geoscientists ("AIG" #2062). Mr. Maynard has had over 35 years of continuous experience in mineral exploration and evaluation and more than 30 years' experience in mineral asset valuation. Mr. Hemming, BAppSc(AppGeol), MAusIMM, is a geologist with over 40 years in the industry and 30 years in mineral asset valuation. Mr Hemming is employed by AM&A. Both Mr. Maynard and Mr. Hemming hold the appropriate qualifications, experience and independence to qualify as an independent "Expert" and "Competent Person" under the definitions of the Valmin Code.

2. RESOLUTION 1 - APPROVAL OF CONSOLIDATION OF EXISTING SHARES

2.1 General

The Company proposes to consolidate its share capital through the conversion of every 10 Existing Shares into one Share.

Under section 254H of the Corporations Act, a company may consolidate its shares if the consolidation is approved by an ordinary resolution of shareholders at a general meeting.

Trading in consolidated Shares will be dependent on the Company's Shares being re-instated to trading on ASX.

2.2 Reasons for the consolidation

The Board considers that the consolidation of its share capital through the conversion of every 10 Existing Shares into one Share is important and necessary as part of the Transaction and its restructuring plans for the Company.

The Company has a large number of Shares on issue due to historical equity-based capital raisings. For that reason, and in contemplation of probable future issues of Shares, the Board believes that the consolidation is necessary for the Company's share capital to be comparable to its peers, in terms of similar sized companies in the same sector.

The Board does not believe that any material disadvantage will arise for Shareholders as a result of the proposed consolidation of the Company's share capital. While the share consolidation will have no effect on the underlying value of the Company, the effect on the Company's share price at the time of conversion should (all things being equal) be to trade at 10 times the price at which the Shares previously traded. The Share price will continue to be influenced by other factors and there can be no assurances as to the level that the Company's Shares will trade following the consolidation and requotation of the Company's securities.

2.3 Effect of consolidation

If the consolidation of Existing Shares is approved, the number of the Company's Shares on issue will be reduced from 410,515,820 to 41,051,582.

As the consolidation applies equally to all Shareholders, individual shareholdings will be reduced in the same ratio as the total number of Shares (subject only to the rounding of fractions). It follows that the consolidation will have no material effect on the percentage interest of each individual Shareholder.

Therefore, if a Shareholder currently has 4,105,159 Shares, representing approximately 1% of the Company's issued capital, then if the share consolidation is approved and implemented, that Shareholder will have 410,516 Shares following the consolidation, still representing the same 1% of the Company's issued capital. Similarly, the aggregate value of each Shareholder's holding (and the Company's market capitalisation) should not materially change as a result of the consolidation – other than minor changes as a result of rounding – as a result of the share consolidation alone (and assuming no other market movement or impacts occur). The price per Share should logically increase in proportion to reflect the reduced number of Shares on issue. However, as this is a market issue, no definite forecast can be provided.

Options

As at the date of this Notice Meeting, the Company has 4,500,000 unlisted Options on issue. If the Share consolidation is approved, the remaining Options will also be reorganised in accordance with their terms and conditions and Listing Rule 7.22.1 (as applicable) on the basis that the number of Options will be consolidated in the same ratio as the share consolidation and the exercise price will be amended in inverse proportion to that ratio.

For example, a holding of 100 Options with an exercise price of $0.10 each prior to the Share consolidation would result in a holding of 10 options with an exercise of $1.00 each after the Share consolidation.

After the share consolidation, there will be approximately 450,000 unlisted Options, comprising:

(a) 50,000 exercisable at $2.50, each on or before 27 July 2016,
(b) 100,000 exercisable at $1.00, each on or before 30 November 2016; and
(c) 300,000 exercisable at $1.20, each on or before 31 March 2017.

The share consolidation will not result in any change to the substantive rights and obligations of existing holders of Options.

Convertible Securities

If the Share consolidation is approved, any convertible securities in the Company will be reorganised in accordance with their terms and conditions and Listing Rule 7.21 (as applicable) so that the Shares into which the convertible securities convert represent the same percentage of the issued ordinary share capital of the Company as they do immediately before the consolidation, and

in a manner which will not result in holders of convertible securities receiving any benefits that holders of Shares do not receive.

2.4 Rounding

Where the consolidation of a Shareholder's holding results in an entitlement to a fraction of a Share, the fraction will be rounded up to the nearest whole number of Shares.

If the Company reasonably believes that a Shareholder has been a party to the division of a shareholding in an attempt to obtain an advantage from this treatment of fractions, the Company may take appropriate action, having regard as appropriate to the terms of the Company's constitution and the ASX Listing Rules. In particular, the Company reserves the right to disregard the division of a Shareholder's shareholding for the purposes of dealing with fractions so as to round up any fraction to the nearest whole number of Shares that would have been received but for the division.

2.5 Tax implications for Shareholders

Shareholders are encouraged to seek and rely only on their own professional advice in relation to their tax position. Neither the Company nor any of its officers, employees or advisors assumes any liability or responsibility for advising Shareholders about the tax consequences for them for the proposed share consolidation.

The share consolidation will occur through the conversion of every 10 Shares into 1 Share. The Board is not aware that any capital gains tax (CGT) event is expected to occur as a result of the share consolidation. However, it is emphasised that Shareholders must obtain their own advice on this regard.

2.6 Other information

Other than as set out in Notice of Meeting, and other information previously disclosed to Shareholders, there is no other information that is known to the Directors which may reasonably be expected to be material to the making of a decision by the Shareholders whether or not to vote in favour of the share consolidation.

2.7 Directors' recommendation

The Directors believe Resolution 1 is in the best interests of the Company and its Shareholders and unanimously recommend Shareholders vote in favour of this Resolution.

3. RESOLUTION 2 - APPROVAL OF TRANSACTION

3.1 General

The Company has agreed, subject to obtaining necessary shareholder approvals, to complete the Transaction as set out in section 1 of this Explanatory Memorandum.

3.2 Summary of Transaction

The key terms of the proposed transaction arrangements are as set out in section 1.3.

3.3 ASX Listing Rule 10.1

The Company is now seeking shareholder approval for the acquisition contemplated in the Transaction under ASX Listing Rule 10.1.

ASX Listing Rule 10.1 provides that an entity (or any of its subsidiaries) must not acquire a substantial asset from, or dispose of a substantial asset to a related party or a substantial holder or an associate of a related party or a substantial holder without shareholder approval.

Jason Brewer, a Director of the Company, is currently Chief Executive Officer and shareholder in AP (and entities associated with him will, pursuant to the Transaction, be issued certain AP Agreement Shares).

Simon Grant-Rennick, a proposed director of the Company (refer to Resolution 7), is a shareholder in AP, and entities associated with him will (pursuant to the Transaction) be issued certain AP Agreement Shares and receive a 20% interest in the Royalty.

A "substantial asset" is an asset valued at greater than 5% of the equity interests of a company as set out in the latest accounts given to ASX under the Listing Rules. The acquisition the subject of the Transaction is of a substantial asset.

It is proposed that the Company enter into the Transaction on the terms set out in section 1. Accordingly, the Company seeks shareholder approval for the acquisition the subject of the Transaction, pursuant to Listing Rule 10.1.

3.4 Independent Expert's Report

Pursuant to Listing Rule 10.10, accompanying this Notice is an Independent Expert's Report prepared by the Independent Expert. The Independent Expert's Report assesses whether the transactions the subject of Resolution 2 are fair and reasonable to the non-associated Shareholders.

Please refer to the Independent Expert's Report in the Schedule of this Notice for further details and in particular the advantages and disadvantages of the Transaction. This assessment is designed to assist all Shareholders in reaching their voting decision. It is recommended all Shareholders read the Independent Expert's Report in full.

3.5 ASX Listing Rule 10.10A.3

Pursuant to ASX Listing Rule 10.10A 3, the Independent Expert's Report prepared by the Independent Expert is available on the Company's website, www.blackmountainresources.com.au. Should any holder of ordinary securities request a hard copy of the Independent Expert's Report, the Company will provide this at no cost to the holder.

3.6 Voting exclusion statement

A voting exclusion statement for Resolution 2 is included in the Notice.

3.7 Directors' recommendation

Mr Jason Brewer is Chief Executive Officer and a shareholder of AP and has refrained from participating in Board deliberations in relation to the Transaction due to having a material personal interest in the outcome.

The Directors (other than Jason Brewer, who declines to make a recommendation) believe Resolution 2 is in the best interests of the Company and its Shareholders and unanimously recommend Shareholders vote in favour of this Resolution.

4. RESOLUTION 3 – APPROVAL OF ISSUE OF CONSIDERATION SHARES AND PAYMENT OF

ADVISORY FEE AND WORKING CAPITAL FEE

4.1 General

The Company has agreed, subject to obtaining necessary Shareholder approvals, to issue 33,190,380 Consideration Shares to JRH, RPM and LBI on Completion. The Company anticipates that Completion will occur no later than 1 month after the date of the General Meeting. In addition, the Company has agreed to pay to LBI the Advisory Fee and Working Capital Fee, as outlined in section 1.4(a).

4.2 Summary of Consideration Shares, Advisory Fee and Working Capital Fee

The key terms of the proposed issue of the Consideration Shares are as set out in section 1.4(a). The ASX has advised that securities issued as consideration under the Transaction (including the Consideration Shares the subject of this Resolution) will need to be restricted securities, as required by Listing Rule 10.7, and assessed in accordance with clauses 5 and 6 of Appendix 9B.

The Advisory Fee of US$3,000,000 cash plus interest at a 5% cumulative annual rate is to be paid by the Company on a deferred basis quarterly in arrears, with each quarterly payment amount calculated as an amount equal to 66% of NMCL and IMIC's net cashflow after tax. It is payable for services provided to the Company by LBI in relation to the Transaction.

The Working Capital Fee is to reimburse LBI US$120,000 for an advance it provided to NMCL.

4.3 Listing Rule 7.1

Listing Rule 7.1 provides a company must not, subject to specified exceptions, issue or agree to issue during any 12 month period any equity securities, or other securities with rights of conversion to equity (such as an option or convertible security), if the number of those securities exceeds 15% of the number of securities in the same class on issue at the commencement date of that 12 month period.

Pursuant to Listing Rule 7.2 (Exception 14), shareholder approval pursuant to Listing Rule 7.1 is not required where approval is being obtained under to Listing Rule 10.11. Accordingly, if Resolution 3is passed by the requisite majority, the issue of the Consideration Shares will be made without using the Company's 15% annual placement capacity and the Company will retain flexibility to issue equity securities in the future, up to the 15% annual placement capacity set out in Listing Rule 7.1.

4.4 ASX Listing Rule 10.11 and Chapter 2E

ASX Listing Rule 10.11 requires shareholder approval to be obtained where an entity issues or agrees to issue securities to a related party or a person whose relationship with the entity or a related party is, in ASX's opinion, such that approval should be obtained unless an exception in ASX Listing Rule 10.12 applies.

Luca Bechis is a related party of RPM and LBI. Given that Luca Bechis is to be elected a Director of the Company (subject to Resolution 7), he is considered a related party of the Company. Accordingly, the Company seeks approval under ASX Listing Rule 10.11 for Resolution 3 to enable the Company to issue the Consideration Shares to JRH, RPM and LBI and pay LBI the Advisory Fee and Working Capital Fee.

The Company also seeks approval under Chapter 2E of the Corporations Act.

Chapter 2E of the Corporations Act requires that for a public company to give a financial benefit to a related party of the public company, the public company or entity must:

(a) obtain the approval of the public company's shareholders in the manner set out in Sections 217 to 227 of the Corporations Act; and
(b) give the benefit within 15 months following such approval, unless the giving of the financial

benefit falls within an exception set out in Sections 210 to 216 of the Corporations Act.

A broad interpretation of whether a financial benefit is given is required under the Corporations Act. An example of a financial benefit is the issuing of securities or making a payment.

Accordingly, approval is sought for Resolution 3 to enable the Company to issue the Consideration Shares to JRH, RPM and LBI and pay the Advisory Fee and Working Capital Fee to LBI. Details of the Consideration Shares, Advisory Fee and Working Capital Fee are provided at section 1.4(a) above.

4.5 Additional information provided in accordance with Listing Rule 10.13 and Chapter 2E

(a) The 33,190,380 Consideration Shares will be issued to Jonah Resource Holdings, Richmond Partners Masters Limited and LB International Limited.
(b) The Consideration Shares will be issued on Completion, which will take place as soon as the conditions to the Transaction (including the key conditions set out in section 1.4(c)) are satisfied. The Consideration Shares will not be issued more than 1 month after the date of the Meeting.
(c) The value of the Consideration Shares to be issued to JRH, RPM and LBI is $nil, on the basis set out in the Independent Expert's Report (pre-Transaction), or $3,319,038, if adopting the per share price under the Capital Raising.
(d) The value of the Advisory Fee is US$3,000,000 and interest at a 5% cumulative annual rate.
(e) The value of the Working Capital Fee is US$120,000.
(f) The basis for issuing the Consideration Shares to JRH, RPM and LBI is to acquire Gulf, for the reasons previously set out in this Explanatory Memorandum.
(g) The basis for paying LBI the Advisory Fee is consideration for services provided to the Company by LBI in relation to the Transaction.
(h) The basis for paying LBI the Working Capital Fee is to reimburse LBI for an advance it provided to NMCL to cover certain costs (as described in section 1.4(a) above).
(i) The Consideration Shares are being issued as part of the Transaction for nil consideration. As such no new funds will be raised by their issue.
(j) Other than the information above and otherwise in this Explanatory Memorandum, the Company believes there is no other information that would be reasonably required by

Shareholders to consider Resolution 3.

JRH, RPM and LBI are considered related parties of the Company for the reasons set out above.

4.6 Voting exclusion statement

A voting exclusion statement for Resolution 3 is included in the Notice.

4.7 Directors' recommendation

The Directors (other than Jason Brewer, who declines to make a recommendation) believe Resolution 3 is in the best interests of the Company and its Shareholders and unanimously recommend Shareholders vote in favour of this Resolution.

5. RESOLUTION 4 – APPROVAL OF ISSUE OF AP AGREEMENT SHARES TO AP

5.1 General

The issue of the AP Agreement Shares to AP form part of the consideration provided by the Company in relation to the Transaction, on the terms set out in this section 1.4 of this Explanatory Memorandum.

5.2 Summary of AP Agreement Shares

The key terms of the proposed issue of AP Agreement Shares are as set out in section 1.3(a). ASX has advised that securities issued as consideration under the Transaction (including the AP Agreement Shares the subject of this Resolution) will need to be restricted securities, as required by Listing Rule 10.7, and assessed in accordance with clauses 5 and 6 of Appendix 9B.

5.3 Listing Rule 7.1

Pursuant to Listing Rule 7.2 (Exception 14), shareholder approval pursuant to Listing Rule 7.1 is not required where approval is being obtained under to Listing Rule 10.11. Accordingly, if Resolution 4 is passed by the requisite majority, the issue of the AP Agreement Shares will be made without using the Company's 15% annual placement capacity and the Company will retain flexibility to issue equity securities in the future, up to the 15% annual placement capacity set out in Listing Rule 7.1.

5.4 ASX Listing Rule 10.11 and Chapter 2E

AP is a related party of the Company due its association with Jason Brewer. Jason Brewer, a Director of the Company, is also Chief Executive Officer and associated with a shareholder of AP. Accordingly, the Company seeks approval under ASX Listing Rule 10.11 for Resolution 4 to enable the Company to issue the AP Agreement Shares the subject of this Resolution to AP.

Approval under Chapter 2E of the Corporations Act is sought for Resolution 4 to enable the Company to issue AP Agreement Shares to AP. Details of the AP Agreement are provided at section 1.4(a).

Chapter 2E of the Corporations Act requires that for a public company to give a financial benefit to a related party of the public company, the public company or entity must:

(a) obtain the approval of the public company's shareholders in the manner set out in Sections 217 to 227 of the Corporations Act; and
(b) give the benefit within 15 months following such approval, unless the giving of the financial benefit falls within an exception set out in Sections 210 to 216 of the Corporations Act.

A broad interpretation of whether a financial benefit is given is required under the Corporations Act. An example of a financial benefit is the issuing of securities. A related party also includes an entity which is controlled by a director of a company.

Jason Brewer is a Director of the Company. He is also the Chief Executive Officer and associated with a shareholder of AP, making AP a related party of the Company for the purposes of Chapter 2E of the Corporations Act.

5.5 Additional information provided in accordance with Listing Rule 10.13 and Chapter 2E

(a) The AP Agreement Shares will be issued to African Phosphate Pty Limited.
(b) The AP Agreement Shares will be issued on Completion, which will take place as soon as the conditions to the Transaction (including the key conditions set out in section 1.3(c)) are satisfied. The AP Agreement Shares will not be issued more than 1 month after the date of the Meeting.
(c) The maximum number of AP Agreement Shares to be issued to AP is 9,500,000.
(d) The value of the AP Agreement Shares to be issued to AP is $nil, on the basis set out in the Independent Expert's Report (pre-Transaction), or $950,000, if adopting the per share price under the Capital Raising.
(e) The basis for issuing the AP Agreement Shares to AP is to acquire AP's right to acquire Gulf. Without the issue, it would not be possible for the Company to acquire Gulf.
(f) The AP Agreement Shares are being issued as part of the Transaction for nil consideration. As such no new funds will be raised by their issue.
(g) Other than the information above and otherwise in this Explanatory Memorandum, the Company believes there is no other information that would be reasonably required by

Shareholders to consider Resolution 4.

AP is a related party of the Company for the reasons set out above. Accordingly, the Company seeks approval under ASX Listing Rule 10.11 and Chapter 2E of the Corporations Act for Resolution 4 to enable the Company to issue the AP Agreement Shares to AP.

5.6 Voting exclusion statement

A voting exclusion statement for Resolution 4 is included in the Notice.

5.7 Directors' recommendation

Mr Jason Brewer is Chief Executive Officer and associated with a shareholder of AP and has refrained from participating in Board deliberations in relation to the Transaction due to having a material personal interest in the outcome.

The Directors (other than Jason Brewer, who declines to make a recommendation) believe Resolution 4 is in the best interests of the Company and its Shareholders and unanimously recommend Shareholders vote in favour of this Resolution.

6. RESOLUTION 5 – APPROVAL OF ISSUE OF AP AGREEMENT SHARES TO JC OR ITS NOMINEES

6.1 General

The Company has agreed, subject to obtaining necessary Shareholder approvals, to issue 5,500,000 AP Agreement Shares to JC (or its nominees) on Completion. The Company anticipates that Completion will occur no later than 1 month after the date of the General Meeting.

6.2 Summary of AP Agreement Shares

The AP Agreement Shares the subject of this Resolution are being issued to JC at the request of AP (as part of the consideration payable by the Company to AP for the Company acquiring AP's right to acquire NMCL). The key terms of the proposed issue the subject of this Resolution are as set out in section 1.4.

ASX has advised that securities issued as consideration under the Transaction (including the AP Agreement Shares the subject of this Resolution) will need to be restricted securities, as required by Listing Rule 10.7, and assessed in accordance with clauses 5 and 6 of Appendix 9B.

6.3 Listing Rule 7.1

Pursuant to Listing Rule 7.2 (Exception 14), shareholder approval pursuant to Listing Rule 7.1 is not required where approval is being obtained pursuant to Listing Rule 10.11. Accordingly, if Resolutions 5 is passed by the requisite majority, the issue of the AP Agreement Shares to JC will be made without using the Company's 15% annual placement capacity and the Company will retain flexibility to issue equity securities in the future, up to the 15% annual placement capacity set out in Listing Rule 7.1.

6.4 ASX Listing Rule 10.11 and Chapter 2E

Jason Brewer is a related party of the Company due to his position as a Director. Accordingly, the Company seeks approval under ASX Listing Rule 10.11 for Resolution 5 to enable the Company to issue the AP Agreement Shares to JC.

Approval under Chapter 2E of the Corporations Act is sought for Resolution 5 to enable the Company to issue the AP Agreement Shares to JC. Details of the AP Agreement Shares the subject of this Resolution are provided at section 1.3.

Chapter 2E of the Corporations Act requires that for a public company to give a financial benefit to a related party of the public company, the public company or entity must:

(a) obtain the approval of the public company's shareholders in the manner set out in Sections 217 to 227 of the Corporations Act; and
(b) give the benefit within 15 months following such approval, unless the giving of the financial benefit falls within an exception set out in Sections 210 to 216 of the Corporations Act.

Jason Brewer is a Director of the Company. He is also the Chief Executive Officer and associated with a shareholder of AP.

Accordingly, the Company seeks approval under Chapter 2E of the Corporations Act for Resolution 5 to enable the Company to issue the AP Agreement Shares the subject of this Resolution to JC (or its nominees).

6.5 Additional information provided in accordance with Listing Rule 10.13 and Chapter 2E

(a) The AP Agreement Shares will be issued to JC Trust Pty Limited.
(b) The AP Agreement Shares will be issued on Completion, which will take place as soon as the conditions to the Transaction (including the key conditions set out in section 1.4(c)). The Consideration Shares will not be issued more than 1 month after the date of the Meeting.
(c) The maximum number of AP Agreement Shares to be issued to JC is 5,500,000.
(d) The value of the AP Agreement Shares to be issued to JC is $nil, on the basis set out in the Independent Expert's Report (pre-Transaction), or $550,000, if adopting the per share price under the Capital Raising.
(e) The basis for issuing the AP Agreement Shares to JC is to acquire AP's right to acquire Gulf. Without the issue, it would not be possible for the Company to acquire Gulf.
(f) The AP Agreement Shares are being issued as part of the Transaction for nil consideration. As such no new funds will be raised by their issue.
(g) Other than the information above and otherwise in this Explanatory Memorandum, the Company believes there is no other information that would be reasonably required by

Shareholders to consider Resolution 5.

6.6 Voting exclusion statement

A voting exclusion statement for Resolution 5 is included in the Notice.

6.7 Directors' recommendation

The Directors (other than Jason Brewer, who declines to make a recommendation) believe Resolution 5 is in the best interests of the Company and its Shareholders and unanimously recommend Shareholders vote in favour of this Resolution.

7. RESOLUTION 6 – APPROVAL OF ISSUE OF AP AGREEMENT SHARES AND ROYALTY TO LANGLEYCOURT AND ALPHA OR THEIR NOMINEES

7.1 General

The Company has agreed, subject to obtaining necessary Shareholder approvals, to issue 3,500,000 AP Agreement Shares and grant a 20% share of the Royalty (as described in section 1.4(a)(ii)) to Langleycourt and Alpha (or their nominees) on Completion. The Company anticipates that Completion will occur no later than 1 month after the date of the General Meeting.

Langleycourt and Alpha are entities associated with Simon Grant-Rennick (to be elected as a Director of the Company, subject to Resolution 8).

7.2 Summary of AP Agreement Shares and Royalty share

The AP Agreement Shares the subject of this Resolution are being issued to Langleycourt and Alpha at the request of AP (as part of the consideration payable by the Company to AP for the Company acquiring AP's right to acquire NMCL). The key terms of the proposed issue the subject of this Resolution are as set out in section 1.3.

The 20% interest in the Royalty the subject of this Resolution is being granted to Langleycourt and Alpha as beneficiaries of the Royalty. The key terms of the proposed grant of the Royalty the subject of this Resolution is set out in section 1.4(a)(ii)).

The ASX has advised that securities issued as consideration under the Transaction (including the AP Agreement Shares the subject of this Resolution) will need to be restricted securities, as required by Listing Rule 10.7, and assessed in accordance with clauses 5 and 6 of Appendix 9B.

7.3 Listing Rule 7.1

Pursuant to Listing Rule 7.2 (Exception 14), shareholder approval pursuant to Listing Rule 7.1 is not required where approval is being obtained pursuant to Listing Rule 10.11. Accordingly, if Resolution 6 is passed by the requisite majority, the issue of the AP Agreement Shares to Langleycourt and Alpha will be made without using the Company's 15% annual placement capacity and the Company will retain flexibility to issue equity securities in the future, up to the 15% annual placement capacity set out in Listing Rule 7.1.

7.4 ASX Listing Rule 10.11 and Chapter 2E

Simon Grant-Rennick is a related party of the Company due to the fact that, subject to the passing of Resolution 8, he will be a Director of the Company. Accordingly, the Company seeks approval under ASX Listing Rule 10.11 for Resolution 6 to enable the Company to issue the AP Agreement Shares to Langleycourt and Alpha, entities associated with Simon Grant-Rennick.

Shareholder approval of the Transaction (which includes the grant of the Royalty) for the purpose of ASX Listing Rule 10.1 is the subject of Resolution 2.

Approval under Chapter 2E of the Corporations Act is sought for Resolution 6 to enable the Company to issue the AP Agreement Shares and grant the 20% interest in the Royalty to Langleycourt and Alpha. Details of the AP Agreement Shares and Royalty interest the subject of this Resolution are provided at section 1.4.

Chapter 2E of the Corporations Act requires that for a public company to give a financial benefit to a related party of the public company, the public company or entity must:

(a) obtain the approval of the public company's shareholders in the manner set out in Sections 217 to 227 of the Corporations Act; and
(b) give the benefit within 15 months following such approval, unless the giving of the financial benefit falls within an exception set out in Sections 210 to 216 of the Corporations Act.

Subject to the passing of Resolution 8, Simon Grant-Rennick will be a Director of the Company.

Accordingly, the Company seeks approval under Chapter 2E of the Corporations Act for Resolution 6 to enable the Company to issue the AP Agreement Shares and grant the 20% interest in the Royalty to Langleycourt and Alpha, entities associated with Simon Grant-Rennick.

7.5 Additional information provided in accordance with Listing Rule 10.13 and Chapter 2E

(a) The AP Agreement Shares will be issued to Langleycourt Properties Limited and Alpha Corporate Service (Bermuda) Limited.
(b) The AP Agreement shares will be issued on Completion, which will take place as soon as the conditions to the Transaction (including the key conditions set out in section 1.3(c)). The Consideration Shares will not be issued more than 1 month after the date of the Meeting.
(c) The maximum number of AP Agreement Shares to be issued to Langleycourt and Alpha is 3,500,000.
(d) The value of the AP Agreement Shares to be issued to Langleycourt and Alpha is $nil, on the basis set out in the Independent Expert's Report (pre-Transaction), or $350,000, if adopting the per share price under the Capital Raising.
(e) The basis for issuing the AP Agreement Shares to Langleycourt and Alpha is to acquire AP's right to acquire Gulf. Without the issue, it would not be possible for the Company to acquire Gulf.
(f) The AP Agreement Shares are being issued as part of the Transaction for nil consideration. As such no new funds will be raised by their issue.
(g) Other than the information above and otherwise in this Explanatory Memorandum, the Company believes there is no other information that would be reasonably required by

Shareholders to consider Resolution 6.

7.6 Voting exclusion statement

A voting exclusion statement for Resolution 6 is included in the Notice.

7.7 Directors' recommendation

The Directors believe Resolution 6 is in the best interests of the Company and its Shareholders and unanimously recommend Shareholders vote in favour of this Resolution.

8. RESOLUTIONS 7, 8 AND 9 – ELECTION OF DIRECTORS

8.1 General

Subject to these Resolutions being passed and Completion occurring, after Completion the Board will comprise of Jason Brewer, John Ryan, Luca Bechis, Simon Grant Rennick and Julian Ford.

Details on each prospective new Director's respective background including experience, knowledge and skills are set out below.

Julian Ford

Mr Ford has over 25 years' experience in the mining sector spanning precious metals, base metals, and bulk commodities in Australia, Africa, South America, Europe and South East Asia. Mr Ford has performed a number of functional and operational management roles which include exploration, mining, mineral beneficiation, hydrometallurgical processing, marketing and shipping. He has founded, developed and led a number of junior mining companies listed on both the ASX and AIM markets.

Mr Ford holds a Bachelor of Chemical Engineering, Bachelor of Commerce (Operations Research) and Graduate Diploma – Business Administration. He is a member of the Australian Institute of Mining and Metallurgy, the Project Management Institute and the Australian Institute of Company Directors.

Simon Grant-Rennick

Mr Grant-Rennick is a mining engineer with over 38 years' experience in exploration, mining and mining geology specialising in industrial minerals. Mr Grant-Rennick is the principal of IMFH a UK based industrial minerals consultancy group providing specialist operations, investment and financial analysis and advice. In addition, Mr Grant-Rennick has owned and managed vermiculite mining and marketing operations in the United States.

Luca Bechis

Mr Bechis has extensive experience in international finance and international capital markets with 25 years' experience. He holds a Master's in Business Administration with Honours and a Business Administration Degree with Honours from Universita Bocconi. Mr Bechis is the Founding Partner, Chief Executive Officer, and Advisor at Richmond Capital LLP and Richmond Partners Masters Limited, the major shareholder of Namakera Mining.

Mr Bechis was also Chairman and Non-Executive Director of ASX listed Gulf Industrials Limited in 2013 and 2014 when they operated the Namakera Vermiculite Mine. Mr Bechis was a Partner at Egerton Capital Limited from 1997 to 2004 and prior to that was European Equity Analyst at Cazenove Group Limited and Head of Italian and French markets at Cazenove & Co in London from 1991 to 1997. Mr Bechis is currently Chairman of HAMC, an Independent Director of Novo Resources Corp. since November 18, 2014 and is a Director of The Richmond Environmental Charitable Foundation.

8.2 Director's recommendation

The Board considers the mix of executive and non-executive Directors collectively brings the range of skills, knowledge and experience necessary to direct the Company.

The Directors (other than, in relation to each of Resolutions 7, 8 and 9, the Director the subject of

9. RESOLUTION 10 – APPROVAL OF ISSUE OF NEW SHARES PURSUANT TO CAPITAL RAISING

9.1 General

The Company proposes to undertake the Capital Raising, pursuant to which it will issue up to 45,000,000 New Shares at an issue price of $0.10 per New Share to raise up to $4,500,000.

9.2 Listing Rule 7.1

Under Listing Rule 7.1, the Company can issue up to 15% of its issued equity securities in a 12 month period (subject to certain exceptions) without Shareholder approval. The effect of the approval under Listing Rule 7.1 of the proposed issue of the New Shares will be that those securities will not be counted as reducing the number of securities which the Company can issue in the future without Shareholder approval under the 15% placement limit imposed by Listing Rule 7.1 (i.e. the 15% limit is "renewed" to the extent of the approval).

Listing Rule 7.3 contains certain requirements as to the contents of a notice sent to Shareholders for the purposes of Listing Rule 7.1 and the following information is included in this Explanatory Memorandum for this purpose:

(a) the Shares to be issued pursuant to this Resolution are up to 45,000,000 New Shares at an issue price of $0.10 per New Share issued to members of the public who wish to acquire them within 3 months after the date of the General Meeting;
(b) all of the New Shares to be issued pursuant to this Resolution will be fully paid ordinary shares which ranked equally with all other existing Shares from their date of issue; and

Item of Expenditure	Amount
Namakera Vermiculite Mine and Process Plant Optimisation Studies	550,000
Namakera Process Plant Capital Works Upgrade	1,200,000
Namakera Mining Fleet and Site Infrastructure Capital Upgrade	850,000
Busumbu Phosphate Resource Definition Drilling and Pre-FeasibilityStudies	550,000
Exploration on North American Silver Projects	250,000
General Administration and Working Capital	750,000
Capital Raising Fees and Expenses	350,000
Total	4,500,000

The above table is a statement of current intentions as at the date of this Notice. Intervening events may alter the way funds are ultimately applied by the Company. The Company's existing cash at hand will continue to be spent in accordance with previous stated objectives in relation to the Company's current operations. The above table is a statement of current intentions as of the date of this Notice. As with any budget, intervening events and new circumstances have the potential to affect the ultimate way funds will be applied. The Board reserves the right to alter the way funds are applied on this basis. Actual expenditure may differ significantly from the above estimates due to a change in market conditions, the development of new opportunities and other factors.

(d) the New Shares will be issued on a single date within 3 months after the date of the General Meeting.

9.3 Voting exclusion statement

A voting exclusion statement for Resolution 10 is included in the Notice.

9.4 Directors' recommendation

The Directors believe Resolution 10 is in the best interests of the Company and its Shareholders and unanimously recommend Shareholders vote in favour of this Resolution.

10. RESOLUTION 11 – APPROVAL OF ISSUE OF FINANCE OPTIONS

10.1 General

The Company is seeking approval under this Resolution to issue up to 2,500,000 Finance Options exercisable at $0.125 on or before 30 June 2018.

10.2 Listing Rule 7.1

Listing Rule 7.3 contains certain requirements as to the contents of a notice sent to Shareholders for the purposes of Listing Rule 7.1 in addition to the information contained in this section and this Explanatory Memorandum generally the following information is included in this Explanatory Memorandum for this purpose:

(a) the number, issue price, issue date, and recipients of the Finance Options issued by the Company are as follows:
- Up to 2,500,000 Finance Options each exercisable at $0.125 cents per Finance Option issued to its financial advisors and a number of its current unsecured debt providers;
- There is no issue price for the Finance Options;
- The Finance Options will be issued no later than 3 months after the date of the General Meeting; and
- The recipients of the Finance Options are not a related party of the Company;
(b) The Finance Options are to be issued by the Company for the provision of financial advisory services relating to the Transaction and to unsecured debt holders for the provision of debt to the Company or for agreeing to refrain demanding repayment of the relevant debt; and
(c) the Finance Options to be issued pursuant to this Resolution are exercisable at $0.125 on

or before 30 June 2018.

(d) the Finance Options will be issued on a single date within 3 months after the date of the General Meeting.

10.3 Voting exclusion statement

A voting exclusion statement for Resolution 11 is included in the Notice.

10.4 Directors' recommendation

The Directors believe Resolution 11 is in the best interests of the Company and its Shareholders and unanimously recommend Shareholders vote in favour of this Resolution.

11. RESOLUTION 12 – APPROVAL OF ISSUE OF DEBT CONVERSION SHARES

11.1 Background

The Company wishes, subject to obtaining necessary shareholder approvals, to issue up to 15,474,800 Debt Conversion Shares to Nazdall, Seefeld, Tyche, Gorilla and various Unrelated Creditors.

The Company has agreed, subject to obtaining necessary shareholder approvals, to issue the following Debt Conversion Shares on Completion of the Transaction:

(a) up to 5,000,000 Debt Conversion Shares to Nazdall;
(b) up to 5,499,800 Debt Conversion Shares to Seefeld;
(c) up to 1,675,000 Debt Conversion Shares to Tyche;
(d) up to 800,000 Debt Conversion Shares to Gorilla; and
(e) up to 2,500,000 Debt Conversion Shares to certain Unrelated Creditors.

The issue of the Debt Conversion Shares to Nazdall is in satisfaction of debts owed to Nazdall for a loan it provided the Company to fund the working capital of the Company's US silver assets. Nazdall has waived interest and agreed to convert the debt at a deemed issue price of $0.10 per Share (being a significant premium to the Company's last market closing price prior to its Shares being suspended from trading on 10 September 2015).

The issue of the Debt Conversion Shares to Seefeld and Tyche is in part-satisfaction of debts owed to Seefeld and Tyche for loans they provided the Company to fund the working capital of the Company's US silver assets. Seefeld and Tyche have waived interest and agreed to convert their respective debts at a deemed issue price of $0.10 per Share (being a significant premium to the Company's last market closing price prior to its Shares being suspended from trading on 10 September 2015).

The issue of the Debt Conversion Shares to Gorilla is in satisfaction of debts and interest owed to Gorilla for loans it provided the Company to fund the working capital of the Company's pending Completion. Gorilla has also agreed to convert its respective debt at a deemed issue price of $0.10 per Share (being a significant premium to the Company's last market closing price prior to its Shares being suspended from trading on 10 September 2015).

None of Nazdall, Seefeld, Tyche or Gorilla are related parties of the Company.

The Company anticipates that Completion will occur no later than 3 months after the date of the General Meeting.

The Company also owes debts to a number of trade and other creditors (excluding the debts and creditors specifically referred to in this section 10) totalling $250,000*.* None of these creditors are related parties of the Company. The Company is seeking approval under this Resolution to have the ability to offer up to 2,500,000 Shares in satisfaction of certain of those debts, over the 3 months after the date of the General Meeting. The Directors believe that a number of the debts owed to the Unrelated Creditors can be negotiated to reduced amounts and/or any applicable interest being waived in exchange for issuing Debt Conversion Shares. However, no agreement has been reached with any of the Unrelated Creditors.

Debt Provider	Principal andInterest DebtOutstanding asat 31/03/2016	To be repaid inshares oncompletion ofthe Transaction	To be repaid incash oncompletion ofthe Transaction	To bewaived/written offon completion ofthe Transaction
Nazdall	$624,566	$500,000	-	$124,566.27
Seefeld	$1,381,142	$549,980	$549,980	$281,182.04
Tyche	$637,125	$167,500	$167,500	$302,125.31
Gorilla		$80,000
Other	$250,000	To be negotiated	To be negotiated	To be negotiated

11.2 Listing Rule 7.1

(a) the number, issue price, issue date, and recipients of the Shares issued by the Company are as follows:
- Up to 5,000,000 Shares to Nazdall;
- up to 5,499,800 Debt Conversion Shares to Seefeld;
- up to 1,675,000 Debt Conversion Shares to Tyche;
- up to 800,000 Debt Conversion Shares to Gorilla;
- up to 2,500,000 Debt Conversion Shares to Unrelated Creditors;
- The Debt Conversion Shares will be issued no later than 3 months after the date of the General Meeting; and
(b) all of the Shares to be issued pursuant to this Resolution are fully paid ordinary shares which rank equally with all other existing Shares from their date of issue;
(c) the Debt Conversion Shares are to be issued by the Company for nil consideration in satisfaction of the debts owed by the Company to various persons, as described in section 11.1 above;
(d) the Debt Conversion Shares will be issued progressively; and
(e) the Debt Conversion Shares will be subject to a voluntary escrow period of 6 months from

the date of issue.

11.3 Voting exclusion statement

A voting exclusion statement for Resolution 12 is included in the Notice.

11.4 Directors' recommendation

The Directors believe Resolution 12 is in the best interests of the Company and its Shareholders and unanimously recommend Shareholders vote in favour of this Resolution.

GLOSSARY

In this document:

Advisory Fee has the meaning prescribed in section 1.3;

Alpha means Alpha Corporate Services (Bermuda) Limited, an entity associated with Simon Grant-Rennick (to be elected as a Director of the Company, subject to Resolution 8);

Annual Report means the Company's Annual Report for the year ended 30 June 2015;

AP means African Phosphate Pty Limited (ACN 608 699 261);

AP Agreement Shares means the Shares to be issued to AP and Jason Brewer as consideration for the Company acquiring AP's right to acquire NMCL, as described in section 1.4 of the Explanatory Memorandum;

Associate has the meaning given to it by Division 2 of Part 1.2 of the Corporations Act;

ASX means ASX Limited (ACN 000 943 377) or the Australian Securities Exchange, as appropriate;

AWST means Australian Western Standard Time;

Board means the Company's Board of Directors;

Busumbu Phosphate Project has the meaning prescribed in section 1.1;

Capital Raising means the Company's proposed capital raising by way of an issue of Shares to the public under a prospectus, as described in section 9 of the Explanatory Memorandum, the funds from which are currently intended to be predominantly used for expenditure in relation to the Busumbu Phosphate Project, Namakera Vermiculite Mine, exploration on North American silver projects, general administration and working capital and capital raising fees and expenses;

Closely Related Party of a member of the Key Management Personnel means:

(a) a spouse or child of the member;
(b) a child of the member's spouse;
(c) a dependent of the member or the member's spouse;
(d) anyone else who is one of the member's family and may be expected to influence the member or be influenced by the member, in the member's dealing with the entity;
(e) a company the member controls; or
(f) a person prescribed by the Corporations Regulations 2001 (Cth);

Company means Black Mountain Resources Limited (ABN 55 147 106 974);

Completion means completion of the Transaction;

Consideration Shares means the Shares to be issued to JRH and RPM in relation to the Transaction, as

described in section 1.4 of the Explanatory Memorandum;

Consolidation means the 1 for 10 consolidation of the Share capital of the Company, as described in section 2 of the Explanatory Memorandum;

Constitution means the Company's Constitution, as amended from time to time;

Composition of Transaction has the meaning prescribed in section 1.4 of the Explanatory Memorandum;

Corporations Act means the Corporations Act 2001 (Cth);

Debt Conversion Shares means the Shares to be issued to Nazdall, Seefeld, Tyche, Gorilla and the Unrelated Creditors in satisfaction or part-satisfaction of the debts owed by the Company to those parties, as described in sections 11 to 13 of the Explanatory Memorandum;

Debt means the current debt owing by Gulf to JRH and RPM at the date of settlement of the Share Sale Agreement, including the loan in the sum of US$10,144,257.37 advanced to Gulf by JRH and RPM presently estimated at US$13,784,554;

Deed of Assignment has the meaning prescribed in section 1.4 of the Explanatory Memorandum;

Directors mean the directors of the Company;

Equity Securities has the same meaning as in the Listing Rules;

Existing Shares means the Shares on issue at the time of the Consolidation;

Explanatory Memorandum means the Explanatory Memorandum which accompanies and forms part of the Notice of Meeting;

Finance Options has the meaning prescribed in section 10 of the Explanatory Memorandum;

General Meeting means the extraordinary general meeting to be held at 10.00 a.m. on 15 A 2016 at Suite 183, Level 6, 580 Hay Street, Perth WA 6000, or any postponement or adjournment of the extraordinary General Meeting;

Gorilla means The Gorilla Pity Pty Ltd (ACN 156 131 690);

Gulf has the meaning prescribed in section 1.1 of the Explanatory Memorandum;

Independent Expert means Stantons International Securities Pty Ltd (ACN 128 908 289);

Independent Expert's Report means the report prepared by the Independent Expert for the purpose of Resolution 2 (as described further in section 3.4);

IMIC has the meaning prescribed in section 1.1 of the Explanatory Memorandum;

JC means JC Trust Pty Limited, an entity associated with Jason Brewer (a Director of the Company);

JRH means Jonah Resource Holdings;

Key Management Personnel has the same meaning as in the accounting standards and broadly includes those persons having authority and responsibility for planning, directing and controlling the activities of the Company, directly or indirectly, including any Director (whether executive or otherwise) of the Company;

Langleycourt means Langleycourt Properties Limited, an entity associated with Simon Grant-Rennick (to be elected as a Director of the Company, subject to Resolution 8);

LBI has the meaning prescribed in section 1.3 of the Explanatory Memorandum;

Listing Rules means the Listing Rules of the ASX;

Namakera Vermiculite Mine has the meaning prescribed in section 1.1 of the Explanatory Memorandum;

Nazdall means Nazdall Pty Limited (ACN 009 649 843);

New Shares means the Shares to be issued as part of the Capital Raising, as described in section 9 of the Explanatory Memorandum;

NMCL means Namakera Mining Company Limited;

Non-Associated Shareholders means a Shareholder who is not Jason Brewer or associated him and does not stand to benefit from the Transaction, except a benefit solely in the capacity of a holder of Shares, or any associate of such a person;

Notice or Notice of Meeting means this notice of Extraordinary General Meeting (also referred to as General Meeting);

Proxy Form means the proxy form attached to the Notice of Meeting;

Resolution means a resolution referred to in the Notice of Meeting;

Royalty has the meaning prescribed in section 1.4(a)(ii));

RPM means Richmond Partners Masters Limited;

Seefeld means Seefeld Investments Ltd (CH-170.3.037.581-5);

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

Share Sale Agreement has the meaning prescribed in section 1.4;

Shareholder means a registered holder of a Share;

Transaction means the corporate transactions described in section 1;

Transaction Party means a party to the Transaction, including RPM, JRH, LBI, AP, JC, Langleycourt, Alpha, the vendors, financiers, advisors and promoters;

Transaction Resolutions has the meaning given in section 1.2 of the Explanatory Memorandum;

Transaction Shares has the meaning prescribed in section 1.7 of the Explanatory Memorandum;

Tyche means Tyche Investments Pty Ltd (ACN 116 226 861);

Unrelated Creditors means certain unrelated creditors of the Company, as described in section 11 of the Explanatory Memorandum; and

VWAP means volume weighted average price.

Lodge your vote:

By Mail: Black Mountain Resources Limited PO Box 1628 Subiaco Western Australia 6904 Australia

Alternatively you can fax your form to (within Australia) 08 9380 8300 (outside Australia) +61 8 9380 8300

For all enquiries call: (within Australia) 1300 850 505

(outside Australia) +61 3 9415 4000

Proxy Form

For your vote to be effective it must be received by 10.00 a.m. (AWST) Saturday, 13 August 2016

How to Vote on Items of Business

All your securities will be voted in accordance with your directions.

Appointment of Proxy

Voting 100% of your holding: Direct your proxy how to vote by marking one of the boxes opposite each item of business. If you do not mark a box your proxy may vote or abstain as they choose (to the extent permitted by law). If you mark more than one box on an item your vote will be invalid on that item.

Voting a portion of your holding: Indicate a portion of your voting rights by inserting the percentage or number of securities you wish to vote in the For, Against or Abstain box or boxes. The sum of the votes cast must not exceed your voting entitlement or 100%.

Appointing a second proxy: You are entitled to appoint up to two proxies to attend the meeting and vote on a poll. If you appoint two proxies you must specify the percentage of votes or number of securities for each proxy, otherwise each proxy may exercise half of the votes. When appointing a second proxy write both names and the percentage of votes or number of securities for each in Step 1 overleaf.

A proxy need not be a securityholder of the Company.

Signing Instructions

Individual: Where the holding is in one name, the securityholder must sign.

Joint Holding: Where the holding is in more than one name, all of the securityholders should sign.

Power of Attorney: If you have not already lodged the Power of Attorney with the registry, please attach a certified photocopy of the Power of Attorney to this form when you return it.

Companies: Where the company has a Sole Director who is also the Sole Company Secretary, this form must be signed by that person. If the company (pursuant to section 204A of the Corporations Act 2001) does not have a Company Secretary, a Sole Director can also sign alone. Otherwise this form must be signed by a Director jointly with either another Director or a Company Secretary. Please sign in the appropriate place to indicate the office held. Delete titles as applicable.

Attending the Meeting

Bring this form to assist registration. If a representative of a corporate securityholder or proxy is to attend the meeting you will need to provide the appropriate "Certificate of Appointment of Corporate Representative" prior to admission. A form of the certificate may be obtained from Computershare or online at www.investorcentre.com under the help tab, "Printable Forms".

Comments & Questions: If you have any comments or questions for the company, please write them on a separate sheet of paper and return with this form.

Turn over to complete the form

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Proxy Form Please mark to indicate your directions

Appoint a Proxy to Vote on Your Behalf STEP 1

I/We being a member/s of Black Mountain Resources Limited hereby appoint

the Chairman OR of the Meeting

PLEASE NOTE: Leave this box blank if you have selected the Chairman of the Meeting. Do not insert your own name(s).

or failing the individual or body corporate named, or if no individual or body corporate is named, the Chairman of the Meeting, as my/our proxy to act generally at the meeting on my/our behalf and to vote in accordance with the following directions (or if no directions have been given, and to the extent permitted by law, as the proxy sees fit) at the Extraordinary General Meeting of Black Mountain Resources Limited to be held at Suite 183, Level 6, 580 Hay Street, Perth, Western Australia on Monday, 15 August 2016 at 10.00 a.m. (AWST) and at any adjournment or postponement of that meeting.

STEP 2

Items of Business PLEASE NOTE: If you mark the Abstain box for an item, you are directing your proxy not to vote on your behalf on a show of hands or a poll and your votes will not be counted in computing the required majority.

		For	Against	Abstain
Resolution 1	Approval of consolidation of Existing Shares
Resolution 2	Approval of Transaction
Resolution 3	Approval of Issue of Consideration Shares to JRH, RPM and LBI and the Advisory Fee and WorkingCapital Fee to LBI
Resolution 4	Approval of Issue of AP Agreement Shares to AP
Resolution 5	Approval of Issue of AP Agreement Shares to JC or its nominees
Resolution 6	Issue of AP Agreement Shares to Langleycourt and Alpha or their nominees
Resolution 7	Election of Luca Bechis as a Director
Resolution 8	Election of Simon Grant-Rennick as a Director
Resolution 9	Election of Julian Ford as a Director
Resolution 10	Issue of New Shares pursuant to the Capital Raising
Resolution 11	Issue of Finance Options
Resolution 12	Issue of Debt Conversion Shares

The Chairman of the Meeting intends to vote undirected proxies in favour of each item of business. In exceptional circumstances, the Chairman of the Meeting may change his/her voting intention on any resolution, in which case an ASX announcement will be made.

Individual or Securityholder 1	Securityholder 2		Securityholder 3
Sole Director and Sole Company Secretary	Director		Director/Company Secretary
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QX RESOURCES LIMITED — Proxy Solicitation & Information Statement 2016

65654_rns_2016-07-13_c1361b3d-1468-4391-9591-5b74ab0561ef.pdf

Notice of Extraordinary General Meeting

Notice of Extraordinary General Meeting

Black Mountain Resources Limited

AGENDA

ORDINARY BUSINESS

1. Resolution 1 – Approval of consolidation of Existing Shares

2. Resolution 2 – Approval of Transaction

3. Resolution 3 – Approval of Issue of Consideration Shares to JRH, RPM and LBI and the Advisory Fee and Working Capital Fee to LBI

4. Resolution 4 – Approval of Issue of AP Agreement Shares to AP

5. Resolution 5 – Approval of Issue of AP Agreement Shares to JC or its nominees

6. Resolution 6 – Issue of AP Agreement Shares to Langleycourt and Alpha or their nominees

7. Resolution 7 – Election of Luca Bechis as a Director

8. Resolution 8 – Election of Simon Grant-Rennick as a Director

9. Resolution 9 – Election of Julian Ford as a Director

10. Resolution 10 – Issue of New Shares pursuant to the Capital Raising

11. Resolution 11 – Issue of Finance Options

12. Resolution 12 – Issue of Debt Conversion Shares

NOTES

1. Background information

2. Recommendation

3. Voting entitlements

4. How to vote

5. Voting in person

6. Voting by proxy

7. Voting by corporate representatives

8. Questions from Shareholders

9. Enquiries

EXPLANATORY MEMORANDUM

1. BACKGROUND INFORMATION REGARDING THE TRANSACTION

1.1 Background to Transaction

a. Namakera Vermiculite Mine

1.2 Requirement for Shareholder Meeting

1.3 Parties and Roles

1.4 Summary of the Transaction

(a) Composition of Transaction

Summary of Transaction flows

AP Agreement

Royalty

Deed of Assignment of Debt

Payment to LBI

(b) Directors

(c) Conditions

1.5 Pro forma balance sheet

Notes:

1.6 Pro forma capital structure

Notes:

1.7 Dilution Due to Transaction

Notes:

1.8 Advantages of the Transaction

1.9 Disadvantages of the Transaction

1.10 Plans for the Company if the Transaction is not approved

1.11 Competent Persons Statement and Listing Rule 5.12 Disclosures

Previous Namakera Estimate

Busumbu Historical Estimate Disclosure

Statement in relation to Historical Estimates

2. RESOLUTION 1 - APPROVAL OF CONSOLIDATION OF EXISTING SHARES

2.1 General

2.2 Reasons for the consolidation

2.3 Effect of consolidation

Shares

Options

Convertible Securities

2.4 Rounding

2.5 Tax implications for Shareholders

2.6 Other information

2.7 Directors' recommendation

3. RESOLUTION 2 - APPROVAL OF TRANSACTION

3.1 General

3.2 Summary of Transaction

3.3 ASX Listing Rule 10.1

3.4 Independent Expert's Report

3.5 ASX Listing Rule 10.10A.3

3.6 Voting exclusion statement

3.7 Directors' recommendation

4. RESOLUTION 3 – APPROVAL OF ISSUE OF CONSIDERATION SHARES AND PAYMENT OF

ADVISORY FEE AND WORKING CAPITAL FEE

4.1 General

QX RESOURCES LIMITED Proxy Solicitation & Information Statement 2016