STREAMPLAY STUDIO LIMITED — AGM Information 2008

Oct 26, 2008

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NOTICE OF ANNUAL GENERAL MEETING AND EXPLANATORY STATEMENT

For the Annual General Meeting to be held on Friday 28 November 2008 at 10.00am (WDT) at 1[st] Floor, 207 Stirling Highway, Claremont WA 6010, Australia.

As this is an important document, please read it carefully.

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

TIME AND PLACE OF MEETING AND HOW TO VOTE

Venue

The Annual General Meeting of the Shareholders of Gippsland Limited ("Gippsland" or the "Company") will be held at:

1[st] Floor, 207 Stirling Highway Commencing at Claremont, WA 6010 10.00am (WDT) Australia on 28 November 2008

How to Vote

You may vote by attending the meeting in person, by proxy or authorised representative.

Voting in Person

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

Voting by Proxy

To vote by proxy, please complete and sign the proxy form enclosed with this Notice of Annual General Meeting as soon as possible and either:

• send the proxy by facsimile to the Company on facsimile number (08) 9340 6060 (International: + 61 8 9340 6060); or

• deliver the proxy to the registered office of the Company at Suite 4, 1[st] Floor, 207 Stirling Highway, Claremont WA 6010, Australia; or

• mail the proxy to PO Box 352, Nedlands WA 6909, Australia;

so it is received not later than 10.00am (WDT) on Wednesday, 26 November 2008.

Your proxy form is enclosed.

NOTES:

1. A Shareholder of the Company who is entitled to attend and vote at a general meeting of Shareholders is entitled to appoint not more than two proxies. Where more than one proxy is appointed, each proxy must be appointed to represent a specified proportion of the Shareholder's voting rights. If the Shareholder appoints two proxies and the appointment does not specify this proportion, each proxy may exercise half of the votes. A proxy need not be a Shareholder of the Company.

2. Where a voting exclusion applies, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote in accordance with the directions on the proxy form to vote as the proxy decides or it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

3. For the purposes of the Corporations Act, the Directors have set a snapshot time and date to determine the identity of those entitled to attend and vote at the Annual General Meeting. The snapshot time and date is 5.00pm (WDT) on 26 November 2008.

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GIPPSLAND LIMITED ABN 31 004 766 376

NOTICE OF ANNUAL GENERAL MEETING

Notice is given that the Annual General Meeting of Shareholders of Gippsland Limited ("Gippsland" or the "Company") will be held at Suite 4, 1[st] Floor, 207 Stirling Highway, Claremont WA 6010, Australia, at 10.00am (WDT) on Friday, 28 November 2008.

AGENDA

BUSINESS

The Explanatory Statement which accompanies and forms part of this Notice describes the matters to be considered as ordinary business and special business. Certain abbreviations and other defined terms are used throughout this Notice. Defined terms are generally identifiable by the use of an upper case first letter. Details of the definitions and abbreviations used are set out in the Glossary contained in the Explanatory Statement.

ORDINARY BUSINESS

Annual Accounts

To receive and consider the financial report of the Company and the consolidated financial report of the consolidated entity for the year ended 30 June 2008 and the reports by the Directors and Independent Auditor.

Resolution 1: Remuneration Report

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

"The section of the report of the Directors for the financial year ending 30 June 2008 dealing with the remuneration of the Company’s Directors, Company Secretary and Senior Executives be adopted."

• Although this resolution is advisory only, this resolution shall be determined as if it were an ordinary resolution.

• This resolution does not bind the Directors or the Company.

Resolution 2: Re-election of a Director (By Rotation) – Dr John M Chisholm

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

"That Dr John Chisholm, being a director of the Company, retires by rotation in accordance with clause 13.2 of the Constitution and, being eligible, is hereby re-elected as a director of the Company."

Short Explanation: Clause 13.2 of the Constitution requires that at the Annual General Meeting, one-third of the Directors for the time being shall retire from office. A retiring Director is eligible for re-election.

Resolution 3: Re-election of a Director (By Rotation) – Mr John SF Dunlop

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

"That Mr John Dunlop, being a director of the Company, retires by rotation in accordance with clause 13.2 of the Constitution and, being eligible, is hereby re-elected as a director of the Company."

Short Explanation: Clause 13.2 of the Constitution requires that at the Annual General Meeting, one-third of the Directors for the time being shall retire from office. A retiring Director is eligible for re-election.

SPECIAL BUSINESS

Resolution 4: Ratify Previous Issue of 12,655,553 Shares

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

“That for the purpose of Listing Rule 7.4 and for all other purposes, Shareholders ratify the issue and allotment on 27 June 2008 of a total of 12,655,553 Shares at an issue price of £0.045 (equivalent to approximately $0.0935 using the exchange rate applicable as at the date of issue) per Share, further details of which are set out in the Explanatory Statement."

The Company will disregard any votes cast on this resolution by a person who participated in the issue and an associate of that person (or those persons). However, the Company need not disregard a vote if it is cast by a person as proxy for a person who

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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.

Short Explanation: The Company may issue no more than that number of securities that equate to 15% of its issued capital in any year without Shareholder approval.

Resolution 5: Ratify Previous Issue of 17,080,000 Shares

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

"That for the purpose of Listing Rule 7.4 and for all other purposes, Shareholders ratify the issue and allotment on 6 October 2008 of a total of 17,080,000 Shares at an issue price of £0.025 (equivalent to approximately $0.057 using the exchange rate applicable as at the date of issue) per Share, further details of which are set out in the Explanatory Statement."

The Company will disregard any votes cast on this resolution by a person who participated in the issue and an associate of that person (or those persons). However, the Company need 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 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.

Short Explanation: The Company may issue no more than that number of securities that equate to 15% of its issued capital in any year without Shareholder approval.

Resolution 6: Ratify Previous Grant of 4,000,000 2011 Series Options

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

"That for the purpose of Listing Rule 7.4 and for all other purposes, Shareholders ratify the grant on 31 January 2008 of a total of 4,000,000 options to acquire Shares, each with an exercise price of £0.07 (equivalent to approximately $0.157 using the exchange rate applicable as at the date of grant) and expiring on 15 December 2011 ("2011 Series Options") for nil consideration, further details of which are set out in the Explanatory Statement."

The Company will disregard any votes cast on this resolution by a person who participated in the issue and an associate of that person (or those persons). However, the Company need 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 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.

Short Explanation: The Company may issue no more than that number of securities that equate to 15% of its issued capital in any year without Shareholder approval.

Resolution 7: Approval of Grant of Officer Options to Mr Robert John (Jack) Telford or His Nominee

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

"That for the purposes of Listing Rule 10.11 and section 208 of the Corporations Act and for all other purposes, the Directors be authorised to grant to Mr Robert John (Jack) Telford or his nominee 5,000,000 Officer Options for no consideration, each Option having an exercise price of 15 cents and an expiry date of 31 May 2012 and otherwise granted on the terms and conditions set out in the Explanatory Statement (including Annexure B to the Explanatory Statement)."

The Company will, in accordance with section 224 of the Corporations Act, disregard any votes cast on this resolution by Robert John (Jack) Telford and any associate of Robert John (Jack) Telford. However, the Company need not disregard a vote if it is cast by a person as a proxy appointed in writing that specifies how the proxy is to vote on the proposed resolution and it is not cast on behalf of Robert John (Jack) Telford or an associate of Robert John (Jack) Telford.

Short Explanation: Unless certain exceptions apply (none of which are relevant here), the Company must not issue securities or give any financial benefit to a related party without Shareholder approval.

Resolution 8: Approval of Grant of Officer Options to Dr John M Chisholm or His Nominee

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

"That for the purposes of Listing Rule 10.11 and section 208 of the Corporations Act and for all other purposes, the Directors be authorised to grant to Dr John Chisholm or his nominee 3,000,000 Officer Options for no consideration, each Option having an

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exercise price of 15 cents and an expiry date of 31 May 2012 and otherwise granted on the terms and conditions set out in the Explanatory Statement (including Annexure B to the Explanatory Statement)."

The Company will, in accordance with section 224 of the Corporations Act, disregard any votes cast on this resolution by John Chisholm and any associate of John Chisholm. However, the Company need not disregard a vote if it is cast by a person as a proxy appointed in writing that specifies how the proxy is to vote on the proposed resolution and it is not cast on behalf of John Chisholm or an associate of John Chisholm.

Short Explanation: Unless certain exceptions apply (none of which are relevant here), the Company must not issue securities or give any financial benefit to a related party without Shareholder approval.

Resolution 9: Approval of Grant of Officer Options to Mr John SF Dunlop or His Nominee

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

"That for the purposes of Listing Rule 10.11 and section 208 of the Corporations Act and for all other purposes, the Directors be authorised to grant to Mr John Dunlop or his nominee 2,000,000 Officer Options for no consideration, each Option having an exercise price of 15 cents and an expiry date of 31 May 2012 and otherwise granted on the terms and conditions set out in the Explanatory Statement (including Annexure B to the Explanatory Statement)."

The Company will, in accordance with section 224 of the Corporations Act, disregard any votes cast on this resolution by John Dunlop and any associate of John Dunlop. However, the Company need not disregard a vote if it is cast by a person as a proxy appointed in writing that specifies how the proxy is to vote on the proposed resolution and it is not cast on behalf of John Dunlop or an associate of John Dunlop.

Short Explanation: Unless certain exceptions apply (none of which are relevant here), the Company must not issue securities or give any financial benefit to a related party without Shareholder approval. Resolution 10: Approval of Grant of Officer Options to Mr Jon Starink or His Nominee

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

"That for the purposes of Listing Rule 10.11 and section 208 of the Corporations Act and for all other purposes, the Directors be authorised to grant to Mr Jon Starink or his nominee 2,000,000 Officer Options for no consideration, each Option having an exercise price of 15 cents and an expiry date of 31 May 2012 and otherwise granted on the terms and conditions set out in the Explanatory Statement (including Annexure B to the Explanatory Statement)."

The Company will, in accordance with section 224 of the Corporations Act, disregard any votes cast on this resolution by Jon Starink and any associate of Jon Starink. However, the Company need not disregard a vote if it is cast by a person as a proxy appointed in writing that specifies how the proxy is to vote on the proposed resolution and it is not cast on behalf of Jon Starink or an associate of Jon Starink.

Short Explanation: Unless certain exceptions apply (none of which are relevant here), the Company must not issue securities or give any financial benefit to a related party without Shareholder approval. Resolution 11: Approval of Grant of Officer Options to Mr John D Kenny or His Nominee

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

"That for the purposes of Listing Rule 10.11 and section 208 of the Corporations Act and for all other purposes, the Directors be authorised to grant to Mr John Kenny or his nominee 1,000,000 Officer Options for no consideration, each Option having an exercise price of 15 cents and an expiry date of 31 May 2012 and otherwise granted on the terms and conditions set out in the Explanatory Statement (including Annexure B to the Explanatory Statement)."

The Company will, in accordance with section 224 of the Corporations Act, disregard any votes cast on this resolution by John Kenny and any associate of John Kenny. However, the Company need not disregard a vote if it is cast by a person as a proxy appointed in writing that specifies how the proxy is to vote on the proposed resolution and it is not cast on behalf of John Kenny or an associate of John Kenny.

Short Explanation: Unless certain exceptions apply (none of which are relevant here), the Company must not issue securities or give any financial benefit to a related party without Shareholder approval.

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Approval of Grant of Officer Options to Mr Rowan S Caren or His Nominee

Resolution 12:

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

"That for the purposes of Listing Rule 7.1 and for all other purposes, the Directors be authorised to grant to Mr Rowan Caren or his nominee 1,000,000 Officer Options for no consideration, each Option having an exercise price of 15 cents and an expiry date of 31 May 2012 and otherwise granted on the terms and conditions set out in the Explanatory Statement (including Annexure B to the Explanatory Statement)."

The Company will disregard any votes cast on this resolution by Rowan Caren and any associate of Rowan Caren. However, the Company need 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 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.

Short Explanation: The Company may issue no more than that number of securities that equate to 15% of its issued capital in any year without Shareholder approval.

Resolution 13: Approval of Grant of Officer Options to Mr Steven J M Chadwick or His Nominee

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

"That for the purposes of Listing Rule 7.1 and for all other purposes, the Directors be authorised to grant to Mr Steven Chadwick or his nominee 2,000,000 Officer Options for no consideration, each Option having an exercise price of 15 cents and an expiry date of 31 May 2012 and otherwise granted on the terms and conditions set out in the Explanatory Statement (including Annexure B to the Explanatory Statement)."

The Company will disregard any votes cast on this resolution by Steven Chadwick and any associate of Steven Chadwick. However, the Company need 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 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.

Short Explanation: The Company may issue no more than that number of securities that equate to 15% of its issued capital in any year without Shareholder approval.

Resolution 14: Approval of Grant of Officer Options to Mr Ayman Ayyash or His Nominee

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

"That for the purposes of Listing Rule 7.1 and for all other purposes, the Directors be authorised to grant to Mr Ayman Ayyash or his nominee 1,000,000 Officer Options for no consideration, each Option having an exercise price of 15 cents and an expiry date of 31 May 2012 and otherwise granted on the terms and conditions set out in the Explanatory Statement (including Annexure B to the Explanatory Statement)."

The Company will disregard any votes cast on this resolution by Ayman Ayyash and any associate of Ayman Ayyash. However, the Company need 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 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.

Short Explanation: The Company may issue no more than that number of securities that equate to 15% of its issued capital in any year without Shareholder approval.

DATED THIS 15th DAY OF OCTOBER 2008

BY ORDER OF THE BOARD

Mr RJ (Jack) Telford Director

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EXPLANATORY STATEMENT

This Explanatory Statement and all attachments are important documents. They should be read carefully.

If you have any questions regarding the matters set out in this Explanatory Statement or the preceding Notice, please contact the Company, your stockbroker or other professional adviser.

Certain abbreviations and other defined terms are used throughout this Explanatory Statement. Defined terms are generally identifiable by the use of an upper case first letter. Details of the definitions and abbreviations used are set out in the Glossary contained in this Explanatory Statement.

This Explanatory Statement has been prepared for the Shareholders of Gippsland in connection with the Annual General Meeting of the Company to be held at 10.00am (WDT) on Friday 28 November 2008 at 1[st] Floor, 207 Stirling Highway, Claremont, Western Australia.

1. RESOLUTION 1 – REMUNERATION REPORT

In accordance with the Corporations Act, a resolution to adopt the Director’s Remuneration Report must be put to Shareholders. The Remuneration Report which details the Company’s policy on the remuneration of non-executive directors, executive directors, the company secretary and senior executives is set out on pages 7 to 10 of the Company’s 2008 Annual Report. It is also available on the Gippsland website at www.gippslandltd.com.

Voting on this resolution is advisory only and does not bind the Company or the Directors.

2. RESOLUTION 2 – RE-ELECTION OF A DIRECTOR (BY ROTATION) – DR JOHN M CHISHOLM

2.1 Background

Resolution 2 seeks approval for the re-election of Dr John Chisholm as a Director.

Clause 13.2 of the Constitution requires that at an Annual General Meeting of the Company one third of the Directors (except the Managing Director or any alternate Director) for the time being shall retire from office. A retiring Director is eligible for re-election.

Dr John Chisholm retires by rotation in accordance with this requirement, is eligible for re-election and puts himself forward for re-election at this Annual General Meeting.

2.2 Directors’ Recommendation

All the Directors (excluding Dr Chisholm) recommend that Shareholders vote in favour of Resolution 2.

3. RESOLUTION 3 – RE-ELECTION OF A DIRECTOR (BY ROTATION) – MR JOHN SF DUNLOP

3.1 Background

Resolution 3 seeks approval for the re-election of Mr John Dunlop as a Director.

Clause 13.2 of the Constitution requires that at an Annual General Meeting of the Company one third of the Directors (except the Managing Director or any alternate Director) for the time being shall retire from office. A retiring Director is eligible for re-election.

Mr John Dunlop retires by rotation in accordance with this requirement, is eligible for re-election and puts himself forward for re-election at this Annual General Meeting.

3.2 Directors’ Recommendation

All the Directors (excluding Mr Dunlop) recommend that Shareholders vote in favour of Resolution 3.

4. RESOLUTION 4 - RATIFY PREVIOUS ISSUE OF 12,655,553 SHARES

4.1 Background

On 27 June 2008, the Company announced to ASX and AIM that it had issued a total of 12,655,553 Shares at £0.045 per Share (" June Placement ") raising gross funds of £569,500 (equivalent to approximately $1,172,515 using the exchange rate applicable as at the date of issue).

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Subject to certain exceptions, none of which are relevant here, the Directors are restricted by Listing Rule 7.1 from issuing or agreeing to issue new securities in the Company in any 12 month period, which amount to more than 15% of the Company’s ordinary securities on issue without Shareholder approval (" 15% Limit ").

Listing Rule 7.4 permits the ratification of previous issues of securities made without prior Shareholder approval, provided the issue did not breach the 15% threshold set by Listing Rule 7.1. The effect of such ratification is to restore a company's maximum discretionary power to issue further securities up to 15% of the issued capital of the company without requiring Shareholder approval.

The Company wishes to ratify this issue pursuant to Listing Rule 7.4, in order to allow the Company to have the right to place up to a further 15% of its issued capital at any time during the next 12 months.

The number of Shares issued under the June Placement represents approximately 4.3% of the Company’s share capital on issue immediately prior to the issue of the placement Shares. This previous issue did not breach the 15% threshold set by Listing Rule 7.1.

The following information is provided to Shareholders for the purposes of Listing Rule 7.5:

• (a) A total of 12,655,553 Shares were allotted.

• (b) The Shares were issued for £0.045 (equivalent to approximately A$0.0935 using the exchange rate applicable as at 27 June 2008, being the date of issue of the Shares) per Share.

• (c) The Shares are fully paid ordinary shares that rank equally in all respect with existing Shares.

• (d) The names of the allottees to whom the Shares were allotted are as follows:

names of the allottees to whom the Shares were allotted are as	follows:
	No. of Shares	£
El Oro & Exploration Co plc	2,611,111	117,500
Pennon Financial Services (Worldwide Nominees)	2,600,000	117,000
J Beveridge	1,666,666	75,000
Colin Orr-Ewing	222,222	10,000
Fox Davies Capital Ltd	1,666,666	75,000
Margot Hail	111,111	5,000
J M Finn Nominees Ltd	3,111,111	140,000
Bank of New York (Nominees) Ltd	666,666	30,000
	12,655,553	569,500

• (e) None of the allottees are related parties to the Company or its associates.

• (f) The funds raised by the issue of the Shares the subject of Resolution 4 have, and will be used to fund further development of the Company’s Abu Dabbab tantalum/tin project and for working capital.

4.2 Directors’ Recommendation

If Resolution 4 is passed, the 15% Limit imposed by Listing Rule 7.1 will be renewed to the extent of the ratification. The Directors of the Company unanimously recommend that Shareholders vote in favour of Resolution 4.

5. RESOLUTION 5 – RATIFY PREVIOUS ISSUE OF 17,080,000 SHARES

5.1 Background

On 6 October 2008, the Company announced to ASX and AIM that it had issued a total of 17,080,000 Shares at £0.025 per Share (" October Placement ") raising gross funds of £427,000 (equivalent to approximately $978,500 using the exchange rate applicable as at the date of issue).

Subject to certain exceptions, none of which are relevant here, the Directors are restricted by Listing Rule 7.1 from issuing or agreeing to issue new securities in the Company in any 12 month period, which amount to more than 15% of the Company’s ordinary securities on issue without Shareholder approval (" 15% Limit ").

Listing Rule 7.4 permits the ratification of previous issues of securities made without prior Shareholder approval, provided the issue did not breach the 15% threshold set by Listing Rule 7.1. The effect of such ratification is to restore a company's maximum discretionary power to issue further securities up to 15% of the issued capital of the company without requiring Shareholder approval.

The Company wishes to ratify this issue pursuant to Listing Rule 7.4, in order to allow the Company to have the right to place up to a further 15% of its issued capital at any time during the next 12 months.

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The number of Shares issued under the October Placement represents approximately 5.6% of the Company’s share capital on issue immediately prior to the issue of the placement Shares. This previous issue did not breach the 15% threshold set by Listing Rule 7.1.

The following information is provided to Shareholders for the purposes of Listing Rule 7.5:

• (a) A total of 17,080,000 Shares were allotted.

• (b) The Shares were issued for £0.025 (equivalent to approximately A$0.0573 using the exchange rate applicable as at 6 October 2008, being the date of issue of the Shares) per Share.

• (c) The Shares are fully paid ordinary shares that rank equally in all respect with existing Shares.

• (d) The names of the allottees to whom the Shares were allotted are as follows:

he names of the allottees to whom the Shares were allotted are as	follows:
	No. of Shares	£
El Oro & Exploration Co plc	1,600,000	40,000
SVS Securities Plc	800,000	20,000
Wills & Co Stockbrokers Ltd	9,000,000	225,000
First Colonial Investments	800,000	20,000
Fox Davies Capital Ltd	4,000,000	100,000
Bell Potter Securities Ltd	880,000	22,000
	17,080,000	427,000

• (e) None of the allottees are related parties to the Company or its associates.

• (f) The funds raised by the issue of the Shares the subject of Resolution 5 have, and will be used to fund further development of the Company’s Abu Dabbab tantalum/tin project and for working capital.

5.2 Directors’ Recommendation

If Resolution 5 is passed, the 15% Limit imposed by Listing Rule 7.1 will be renewed to the extent of the ratification. The Directors of the Company unanimously recommend that Shareholders vote in favour of Resolution 5.

6. RESOLUTION 6 - RATIFY PREVIOUS GRANT OF 4,000,000 2011 SERIES OPTIONS

6.1 Background

On 31 January 2008, the Company announced to ASX that it had granted a total of 4,000,000 2011 Series Options to acquire Shares at an exercise price of £0.07 per Share by no later than 15 December 2011.

The 2011 Series Options were granted for nil consideration as part of arrangements with the Company’s brokers in the United Kingdom therefore no funds were raised by the issue.

Subject to certain exceptions, none of which are relevant here, the Directors are restricted by Listing Rule 7.1 from issuing or agreeing to issue new securities in the Company in any 12 month period, which amount to more than 15% of the Company’s ordinary securities on issue without Shareholder approval ("15% Limit").

Listing Rule 7.4 permits the ratification of previous issues of securities made without prior Shareholder approval, provided the issue did not breach the 15% threshold set by Listing Rule 7.1. The effect of such ratification is to restore a company's maximum discretionary power to issue further securities up to 15% of the issued capital of the company without requiring Shareholder approval.

The Company wishes to ratify this issue pursuant to Listing Rule 7.4, in order to allow the Company to have the right to place up to a further 15% of its issued capital at any time during the next 12 months.

The number of securities issued under represents approximately 1.4% of the Company’s share capital on issue immediately prior to the issue of the 2011 Series Options. This previous issue did not breach the 15% threshold set by Listing Rule 7.1.

The following information is provided to Shareholders for the purposes of Listing Rule 7.5:

• (a) A total of 4,000,000 2011 Series Options were granted.

• (b) The 2011 Series Options were issued to the Company’s UK brokers for nil consideration.

• (c) The 2011 Series Options do not entitle the holder to voting rights. Shares issued upon conversion of the Options would be fully paid ordinary shares that rank equally in all respect with existing Shares.

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(d) The names of the brokers to whom the 2011 Series Options were allotted are as follows:

Broker	№ of Options
FD Holdings Limited	2,000,000
Seymour Pierce Limited	2,000,000
	4,000,000

• (e) None of the grantees are related parties to the Company or its associates.

• (f) The main terms of the 2011 Series Options are set out in Annexure A to this Explanatory Statement.

6.2 Directors’ Recommendation

If Resolution 6 is passed, the 15% Limit imposed by Listing Rule 7.1 will be renewed to the extent of the ratification. The Directors of the Company unanimously recommend that Shareholders vote in favour of Resolution 6.

7. RESOLUTIONS 7 TO 11 – APPROVAL OF GRANT OF OFFICER OPTIONS TO DIRECTORS OR THEIR RESPECTIVE NOMINEES

7.1 Requirement under the Corporations Act and Listing Rules

The Company proposes to grant a total of 13,000,000 Officer Options (each with an exercise price of 15 cents and an expiry date of 31 May 2012) to Messrs Telford, Chisholm, Dunlop, Starink and Kenny, or their respective nominees. The terms of the Officer Options are set out in Annexure B to this Explanatory Statement.

The Officer Options will be granted as follows:

ptions will be granted as follows:
Director	№ of Officer Options
Robert John (Jack) Telford, or his nominee(s)	5,000,000
John M Chisholm, or his nominee(s)	3,000,000
John SF Dunlop, or his nominee(s)	2,000,000
Jon Starink, or his nominee(s)	2,000,000
John D Kenny, or his nominee(s)	1,000,000
Total	13,000,000

The grant of Officer Options encourages the Directors to have a greater involvement in the achievement of the Company’s objectives and to provide an incentive to strive to that end by participating in the future growth and prosperity of the Company through share ownership. Under the Company’s current circumstances it is considered that the incentives intended for the Directors represented by the grant of these Officer Options are a cost effective and efficient means for the Company to provide a reward and an incentive, as opposed to alternative forms of incentive, such as the payment of additional cash compensation.

The number of Officer Options to be granted to each of the Directors has been determined based upon a consideration of:

• the remuneration of the Directors;

• the Directors wish to ensure that the remuneration offered is competitive with market standards. The Directors have considered the proposed number of Officer Options to be granted will ensure that the Directors’ overall remunerations is in line with market standards; and

• incentives to attract and ensure continuity of service of directors who have appropriate knowledge and expertise.

Shareholders should note that for the reasons noted above, it is proposed to grant Officer Options to Messrs Dunlop and Kenny notwithstanding the guidelines contained in Box 8.2 of the ASX Corporate Governance Council's Corporate Governance Principles and Recommendations (" Principles ") which states that non-executive directors should not receive options.

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In the event the Officer Options are exercised, the following amounts will need to be paid to the Company by the Directors:

Director	Amount to be paid upon option exercise ($)
Robert John (Jack) Telford	750,000
John M Chisholm	450,000
John SF Dunlop	300,000
Jon Starink	300,000
John D Kenny	150,000
Total	1,950,000

The Company will therefore receive $1,950,000 from the Directors should all the Officer Options granted under Resolutions 7 to 11 be exercised.

7.2 Chapter 2E of the Corporations Act 2001

Related Party Transactions Generally

Chapter 2E of the Corporations Act prohibits a public company from giving a financial benefit to a related party of the public company unless either:

1. the giving of the financial benefits falls within one of the nominated exceptions to the provision; or

2. shareholder approval is obtained prior to the giving of the financial benefit and the benefit is given within 15 months after obtaining such approval.

For the purposes of Chapter 2E of the Corporations Act, each of the Directors is considered to be a related party of the Company.

Resolutions 7 to 11 provide for the grant of Officer Options to Directors which is a financial benefit which requires Shareholder approval.

7.3 Current Holdings

Set out below are details of each of the Directors’ relevant interest in Shares as at the date of this Notice:

Director	№ of Shares
Robert John (Jack) Telford	20,126,4461
John M Chisholm	2,420,0002
John SF Dunlop	Nil
Jon Starink	300,0003
John D Kenny	2,250,0004
Total	25,096,446

Notes:

1. 13,568,124 Shares are held by Eco International Pty Ltd, an entity of which Mr Telford is a director and shareholder. 6,558,322 Shares are held jointly by Mr Telford and Mrs Robin Telford.

2. 2,320,000 Shares are held by Mandu Superannuation Fund Pty Ltd, an entity of which Dr Chisholm is a director and shareholder, as trustee for the Mandu Superannuation Fund, of which Dr Chisholm is a beneficiary, and 100,000 Shares are held by Mandu Pty Ltd, an entity of which Dr Chisholm is a director and shareholder;

3. 300,000 Shares are held by Lazarus Foundation Pty Ltd as trustee for the Rand Trust. Jon Starink is a director of the Lazarus Foundation Pty Ltd and a beneficiary of the Rand Trust.

4. 2,250,000 Shares are held by Ventureworks JDK Pty Ltd, an entity of which Mr Kenny is a director and shareholder.

5. None of the Directors hold any relevant interest in Options.

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7.4 Information Requirements

For the purposes of Chapter 2E of the Corporations Act the following information is provided.

(a) The related parties to whom the proposed resolutions would permit the financial benefit to be given:

Subject to Shareholder approval, the following maximum number of Officer Options will be granted to the following related parties, or their respective nominees:

Director	№ of Officer Options
Robert John (Jack) Telford, or his nominee(s)	5,000,000
John M Chisholm, or his nominee(s)	3,000,000
John SF Dunlop, or his nominee(s)	2,000,000
Jon Starink, or his nominee(s)	2,000,000
John D Kenny, or his nominee(s)	1,000,000
Total	13,000,000

(b) The nature of the financial benefit

The proposed financial benefit to be given is the grant of Officer Options for no consideration to the Directors as noted above.

(c) Directors’ recommendation

All the Directors were available to make a recommendation. For the reasons noted above:

Messrs Chisholm, Dunlop, Starink and Kenny (who have no interest in the outcome of Resolution 7) recommend that Shareholders vote in favour of Resolution 7. Mr Telford declines to make a recommendation about Resolution 7 as he has a material personal interest in the outcome of that particular Resolution as it relates to the proposed grant of Officer Options to him or his nominee(s).

Messrs Telford, Dunlop, Starink and Kenny (who have no interest in the outcome of Resolution 8) recommend that Shareholders vote in favour of Resolution 8. Dr Chisholm declines to make a recommendation about Resolution 8 as he has a material personal interest in the outcome of that particular Resolution as it relates to the proposed grant of Officer Options to him or his nominee(s).

Messrs Telford, Chisholm, Starink and Kenny (who have no interest in the outcome of Resolution 9) recommend that Shareholders vote in favour of Resolution 9. Mr Dunlop declines to make a recommendation about Resolution 9 as he has a material personal interest in the outcome of that particular Resolution as it relates to the proposed grant of Officer Options to him or his nominee(s).

Messrs Telford, Chisholm, Dunlop and Kenny (who have no interest in the outcome of Resolution 10) recommend that Shareholders vote in favour of Resolution 10. Mr Starink declines to make a recommendation about Resolution 10 as he has a material personal interest in the outcome of that particular Resolution as it relates to the proposed grant of Officer Options to him or his nominee(s).

Messrs Telford, Chisholm, Dunlop and Starink (who have no interest in the outcome of Resolution 11) recommend that Shareholders vote in favour of Resolution 11. Mr Kenny declines to make a recommendation about Resolution 11 as he has a material personal interest in the outcome of that particular Resolution as it relates to the proposed grant of Officer Options to him or his nominee(s).

(d) Other information that is reasonably required by members to make a decision and that is known to the Company or any of its Directors.

The proposed ordinary Resolutions 7 to 11 would have the effect of giving power to the Directors to grant a total of 13,000,000 Officer Options on the terms and conditions as set out in Annexure B to this Explanatory Statement and as otherwise mentioned above.

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The Company currently has 323,434,325 quoted Shares and the following unquoted Options on issue:

Number	Exercise Price	Expiry Date
25,000,000	$0.135	16 May 2012
4,000,000	£0.07	15 December 2011

If all Officer Options granted as proposed above are exercised, and assuming all existing Options on issue have been exercised (including those Officer Options the subject of Resolutions 12 to 15), the effect would be to dilute the share holding of existing Shareholders by 3.7%. The market price of the Company’s Shares during the period of the Officer Options will normally determine whether or not the Directors exercise the Officer Options. At the time any Officer Options are exercised and Shares are issued pursuant to the exercise of the Officer Options, the Company’s Shares may be trading at a price which is higher than the exercise price of the Officer Options.

The Directors’ fees per annum (including superannuation) and the total financial benefit to be received by them in this current period as a result of the grant of the Officer Options the subject of Resolutions 7 to 11 are as follows:

Director	Fees & Salary p.a. ($)	Value of Officer options ($)	Total Financial Benefit ($)
Robert John (Jack) Telford	285,000	123,000	408,000
John M Chisholm	265,000	73,800	338,800
John SF Dunlop	45,000	49,200	94,200
Jon Starink	120,000	49,200	169,200
John D Kenny	45,000	24,600	69,600

The indicative option valuation of 2.46 cents is a theoretical valuation of each option using the Binomial Model.

(e) Valuation of Officer Options

The Company has valued the Officer Options to be granted to the Directors using the Binomial Model. The value of an option calculated by the Binomial Model is a function of a number of variables. The valuation of the Officer Options has been prepared using the following assumptions:

Variable	Input
Share price 14 October 08	8.4 cents
Exercise price	15.0 cents
Risk Free Interest Rate	6%
Volatility	55%
Time (years to expiry)	3.5

The Company has calculated the value of each option based on the following assumptions:

1. It based the underlying value of each share in the Company on the Australian Securities Exchange closing price of 8.4 cents on 14 October 2008;

2. Risk free rate of return – 6% pa (estimated, based on the overnight money market interest rate targeted by the Reserve Bank of Australia as at 13 October 2008);

3. It used a volatility of the share price of 55% as determined from the daily movements in share price over the last 3.5 years, adjusted for abnormal trading.

Based on the assumptions, it is considered that the estimated average value of the Officer Options to be granted to the Directors is 2.46 cents per Officer Option.

Any change in the variables applied in the Binomial calculation between the date of the valuation and the date the Officer Options are granted would have an impact on their value.

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The following table gives details of the highest, lowest and latest closing prices of the Company’s Shares trading on ASX over the past 12 months ending on 14 October 2008;

Highest Price (cents) / Date	Lowest Price (cents) / Date	Latest Price (cents) / Date
11.5 cents on 22 October, 14 November 2007 and 12 and 13 December 2007	6.5 cents on 8, 9 and 10 October 2008	8.4 cents on 14 October 2008

(f) Other Information

Under the Australian Equivalent of IFRS, the Company is required to expense the value of the Officer Options in its statement of financial performance for the current financial year. Other than as disclosed in this Explanatory Statement, the Directors do not consider that from an economic and commercial point of view, there are any costs or detriments including opportunity costs or taxation consequences for the Company or benefits foregone by the Company in granting the Officer Options pursuant to Resolutions 7 to 11.

Neither the Directors not the Company are aware of other information that would be reasonably required by Shareholders to make a decision in relation to the financial benefits contemplated by the proposed resolutions.

7.5 Listing Rule 10.11

Listing Rule 10.11 requires Shareholder approval by ordinary resolution to any issue by a listed company of securities to a related party. Accordingly, Listing Rule 10.11 requires Shareholders to approve the grant of Officer Options to the Directors.

7.6 Additional Information

The following information in relation to the Officer Options to be granted pursuant to Resolutions 7 to 11 is provided to Shareholders for the purposes of Listing Rule 10.13:

• (a) the Officer Options will be granted to the Directors, or their nominees, as noted above;

• (b) the maximum number of Officer Options to be granted under Resolutions 7 to 11 is 13,000,000;

• (c) the Officer Options will be allotted and granted on a date which will be no later than 1 month after the date of this meeting, unless otherwise extended by way of ASX granting a waiver to the Listing Rules;

• (d) the Officer Options will be granted for no consideration;

• (e) no funds will be raised by the grant of the Officer Options; and

• (f) the terms and conditions of the Officer Options are set out in Annexure B to this Explanatory Statement.

If approval is given for the grant of the Officer Options under Listing Rule 10.11, approval is not required under Listing Rule 7.1.

8. RESOLUTIONS 12 TO 14 – APPROVAL OF GRANT OF OFFICER OPTIONS TO EXECUTIVES, CONSULTANTS OR THEIR NOMINEES

8.1 Background

The Company proposes to grant a total of 4,000,000 Officer Options (each with an exercise price of 15 cents and an expiry date of 31 May 2012) to Messrs Caren, Chadwick and Ayyash (" Executives and Consultants "), or their nominees. The terms and conditions of the Officer Options proposed to be granted pursuant to Resolutions 12 to 14 are identical to those proposed to be granted to the Directors pursuant to Resolutions 7 to 11 and these terms and conditions are set out in Annexure B to this Explanatory Statement.

The Officer Options will be granted as follows:

ns will be granted as follows:
Executive or Consultant	Number of Officer Options
Rowan Caren, or his nominee(s)	1,000,000
Steven Chadwick, or his nominee(s)	2,000,000
Ayman Ayyash, or his nominee(s)	1,000,000
Total	4,000,000

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The grant of Officer Options encourages the Executives and Consultants to have a greater involvement in the achievement of the Company’s objectives and to provide an incentive to strive to that end by participating in the future growth and prosperity of the Company through share ownership. Under the Company’s current circumstances it is considered that the incentives intended for the Executives and Consultants represented by the grant of these Officer Options are a cost effective and efficient means for the Company to provide a reward and an incentive, as opposed to alternative forms of incentive, such as the payment of additional cash compensation.

Subject to certain exceptions, none of which are relevant here, the Directors are restricted by Listing Rule 7.1 from issuing or agreeing to issue new securities in the Company in any 12 month period, which amount to more than 15% of the Company’s ordinary securities on issue without Shareholder approval (" 15% Limit ").

The grant of Officer Options the subject of Resolutions 12 to 14 does not exceed 15% of the Company's fully paid ordinary securities on issue however Listing Rule 7.1 approval is sought so that the 15% threshold is maintained and available for use by the Company in the future should the circumstances require it.

8.2 Information for Shareholders

The following information is provided to Shareholders for the purposes of Listing Rule 7.3:

• (a) the maximum number of Officer Options to be granted under Resolutions 12 to 14 is 4,000,000;

• (b) the Officer Options will be allotted and granted on a date which will be no later than 3 months after the date of this meeting, unless otherwise extended by way of ASX granting a waiver to the Listing Rules;

• (c) the Officer Options will be granted for no consideration;

• (d) the Officer Options will be granted to the Executives and Consultants, or their nominees, as noted above who are not related parties of the Company;

• (e) the terms and conditions of the Officer Options are set out in Annexure B to this Explanatory Statement; and

• (f) no funds will be raised by the grant of the Officer Options.

9. ENQUIRIES

Shareholders are invited to contact the Company Secretary, Rowan Caren on (08) 9340 6000 if they have any queries in respect of the matters set out in these documents.

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GLOSSARY

"$"	means Australian dollars;
"2011 Series Option"	means an Option exercisable at 7 UK pence each on before 5.00pm WST on 15
	December 2011 and granted on the terms and conditions set out in Annexure A;
"AIM"	means the Alternative Investment Market of the London Stock Exchange;
"ASX"	means ASX Limited and, where the context permits, the Australian Securities
	Exchange operated by ASX Limited;
"Board"	means the board of Directors;
"Company" or "Gippsland"	means Gippsland Limited ABN 31 004 766 376;
"Constitution"	means the Company's Constitution;
"Corporations Act"	means the Corporations Act 2001 (Cth);
"Directors"	means the directors of the Company;
"Listing Rules"	means the Listing Rules of ASX;
"Notice", "Notice of Meeting" or	means the notice of meeting which accompanies this Explanatory Statement;
"Notice of Annual General Meeting"
"Officer Option"	means an Option granted on the terms and conditions set out in Annexure B to this
	Explanatory Statement;
"Option"	means an option to acquire one Share;
"Resolution"	means a resolution proposed pursuant to the Notice;
"Shareholders'"	means the holders of the Shares;
"Shares"	means fully paid ordinary shares in the Company;
"WDT"	means Australian Western Daylight Time; and
"WST"	means Australian Western Standard Time.

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ANNEXURE A

TERMS AND CONDITIONS OF 2011 SERIES OPTIONS

The 2011 Series Options entitle the holder to subscribe for ordinary fully paid shares in the Company at the designated exercise price per share on the following terms:

• (i) Each Option entitles the holder to subscribe for one share at an exercise price of £0.07 per share ("Exercise Price").

• (ii) The Options shall lapse at 5.00p.m. Western Standard Time on 15 December 2011.

• (iii) The Options shall be exercisable wholly or in part by notice in writing to the Company at any time until the expiry date and upon payment of the designated exercise price per option.

• (iv) There are no participating rights or entitlements inherent in these Options and holders of Options will not be entitled to participate in new issues of capital which may be offered to shareholders during the currency of the Options.

• (v) Shares issued on the exercise of the options will rank pari passu with the then existing issued ordinary capital.

• (vi) The Company shall, in accordance with Listing Rule 2.8, make application to have Shares allotted pursuant to an exercise of Options listed for Official Quotation, subject to the Company being a company listed on ASX.

• (vii) In the event of any re-organisation of capital of the Company, all rights of the Option Holder will be changed to the extent necessary to comply with the Listing Rules applying to a re-organisation of capital at the time of the re-organisation in accordance with the Listing Rules.

• (viii) The Options will not give any right to participate in dividends until Shares are allotted pursuant to the exercise of the relevant Options.

• (ix) In the event that a pro rata issue (except a bonus issue) is made to the holders of the underlying securities in the Company, the exercise price of the Options may be reduced according to the following formula:

• O' = O - E[P - (S + D)]

  • N + 1

• O' = the new exercise price of the Option.

• O = the old exercise price of the Option.

• E = the number of underlying securities in the Company into which one option is exercisable.

• P = the average market price per security (weighted by reference to volume) of the underlying securities in the Company during the five (5) trading days ending on the day before the ex rights date or ex entitlements date.

• S = the Subscription price for a security under the pro rata issue.

• D = the Dividend due but not yet paid on the existing underlying securities (except those to be issued under the pro rata issue).

• N = the Number of securities with rights or entitlements that must be held to receive a right to one new security in the Company.

• (x) The number of Shares to be issued pursuant to the exercise of Options will be adjusted for bonus issues made prior to exercise of Options. The effect will be that upon exercise of the Options, the number of Shares received by the Option Holder will include the number of bonus Shares that would have been issued if the Options had been exercised prior to the record date for bonus issues. The exercise price of the Options shall not change as result of any such bonus issue. The Company shall notify each Option Holder and ASX, subject to the Company being a company listed on ASX, within one (1) month after the record date for a pro-rata bonus or cash issue of the adjustment to the number of Shares over which the Option exists and/or the adjustment to the exercise price.

• xi) The Options allocated to a broker may be cancelled at the discretion of the Board if the Broker terminates its relationship with the company voluntarily within two years of appointment.

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ANNEXURE B TERMS AND CONDITIONS OF OFFICER OPTIONS

The following are the terms and conditions of the 13,000,000 Options the subject of Resolutions 7 to 11 and the 4,000,000 Options the subject of Resolutions 12 to 14 being put before Shareholders.

• (i) The Options will be granted for nil consideration.

• (ii) An option certificate will be issued for the Options.

• (iii) The Options will expire at 5.00pm Perth time on 31 May 2012 (" Expiry Date ").

• (iv) The Option is a right in favour of the option holder to subscribe for one fully paid ordinary share in the Company (" Share ").

• (v) The option holder may exercise Options any time prior to the Expiry Date.

• (vi) Shares allotted to option holders on exercise of Options will be issued at 15 cents each (" Exercise Price ").

• (vii) The Exercise Price of shares the subject of the Options will be payable in full on exercise of the Options.

• (viii) Subject to clause (ix), if [ insert name of Executive/Consultant ]’s position with the Company is terminated by the [ insert name of Executive/Consultant ] the Options may be exercised by the holder (or the holder's legal personal representative(s)) within 30 days of the termination of the [ insert name of Executive/Consultant ]'s position with the Company provided that:

• (a) the Options have not lapsed under clause (iii);

• (b) the Options are entitled to be exercised pursuant to clause (iv); and

• (c) the Board has not deemed any unexercised Options of the holder to have lapsed (such power being in the Board's absolute discretion).

If the Option is not exercised within the 30 day period provided in this clause, it will lapse.

• (ix) If [ insert name of Executive/Consultant ]'s position with the Company is terminated for misbehaviour then the Board may in its absolute discretion deem any unexercised Options of the holder to have lapsed. The Board's decision will be final and binding.

• (x) Options will be exercisable by the delivery to the registered office of the Company of a notice in writing stating the intention of the option holder to:

• (a) exercise all or a specified number of Options (but in multiples of 250,000); and

• (b) pay the subscription monies in full for the exercise of each Option (" Notice ").

• (xi) The Notice must be accompanied by the option certificate and a cheque made payable to the Company for the subscription monies for the Shares. An exercise of only some Options will not affect the rights of the option holder to the balance of the Options held by the option holder. The Notice must be received by the Company prior to the Expiry Date.

• (xii) The Company will allot the resultant Shares and deliver the holding statement within ten (10) business days of the exercise of the Options;

• (xiii) The Company will not apply for official quotation on ASX and AIM of any of the Options;

• (xiv) The Options will not be transferable;

• (xv) Shares allotted pursuant to an exercise of the Options shall rank, from the date of allotment, equally with existing ordinary fully paid Shares of the Company in all respects;

• (xvi) The Company will in accordance with the Listing Rules make application to have Shares allotted pursuant to an exercise of Options listed for official quotation on ASX and AIM.

• (xvii) Shares issued pursuant to the exercise of the Options may not be offered for sale by the option holder unless:

• (a) the offer is made in the circumstances that do not require disclosure to investors under Part 6D.2 of the Corporations Act 2001 (Cth) (" Corporations Act "); or

• (b) one of the following occurs:

  • (i) the Company gives ASX a notice that complies with section 708A(6) of the Corporations Act;

  • (ii) the Company lodges a prospectus with ASIC that qualifies the Shares for resale under section 708A(11) of the Corporations Act; or

  • (iii) the expiry of 12 months after issue of the Shares.

After an Option is validly exercised the Company must use all reasonable endeavours in accordance with section 708A(5)(e) of the Corporations Act to give ASX a written notice that complies with section 708A(6) of the Corporations Act.

• (xviii) In the event of any reconstruction (including consolidation, subdivision, reduction or return) of the authorised or issued capital of the Company, the number of the Options or the exercise price of the Options or both will be reconstructed (as appropriate) in accordance with the Listing Rules of ASX; and

• (xix) The Options will not give any right to participate in dividends, bonus issues or pro rata issues until Shares are allotted pursuant to the exercise of the relevant Options. There is no right to change the exercise price of Options nor the number of underlying Shares over which the Options can be exercised, if the Company completes a bonus or pro rata issue.

• (xx) Unless otherwise stated in this annexure, any terms that are not defined in this annexure shall have the same meaning as set out in the Explanatory Statement to which this annexure forms part.

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PROXY FORM APPOINTMENT OF PROXY

GIPPSLAND LIMITED

ABN 31 004 766 376

ANNUAL GENERAL MEETING

I/We _____________ of (address) _____________

being a Member of Gippsland Limited entitled to attend and vote at the Annual General Meeting, hereby Appoint

Name of proxy _____________ of (address) _____________

or failing the person so named or, if no person is named, the Chairman of the Annual General Meeting, to vote in accordance with the following directions or, if no directions have been given, as the proxy sees fit at the Annual General Meeting to be held at 1[st] Floor, 207 Stirling Highway, Claremont WA 6010, Australia on Friday, 28 November 2008 at 10.00am (WDT) and at any adjournment thereof.

Resolution 1 Remuneration Report Resolution 2 Re-election of a Director (by rotation) – Dr John Chisholm Resolution 3 Re-election of a Director (by rotation) – Mr John Dunlop Resolution 4 Ratify Previous Issue of 12,655,553 Shares Resolution 5 Ratify Previous Issue of 17,080,000 Shares Resolution 6 Ratify Previous Issue of 4,000,000 Options Resolution 7 Approval of Grant of Officer Options to Robert John (Jack) Telford or his Nominee Resolution 8 Approval of Grant of Officer Options to John Chisholm or his Nominee Resolution 9 Approval of Grant of Officer Options to John Dunlop or his Nominee Resolution 10 Approval of Grant of Officer Options to Jon Starink or his Nominee Resolution 11 Approval of Grant of Officer Options to John Kenny or his Nominee Resolution 12 Approval of Grant of Officer Options to Rowan Caren or his Nominee Resolution 13 Approval of Grant of Officer Options to Steven Chadwick or his Nominee Resolution 14 Approval of Grant of Officer Options to Ayman Ayyash or his Nominee	FOR	AGAINST	ABSTAIN

If the Chairman of the meeting is appointed as your proxy, or may be appointed by default and you do not wish direct your proxy how to vote as your proxy in respect of Resolution 7, please place a mark in the adjacent box.

By marking this box, you acknowledge that the Chairman of the meeting may exercise your proxy even if he has an interest in the outcome of Resolution 7 and that votes cast by him for Resolution 7 other than as proxy holder will be disregarded because of the interest. If you do not mark this box, and you have not directed your proxy how to vote, the Chairman will not cast your votes on Resolution 7 and your votes will not be counted in calculating the required majority if a poll is called on Resolution 7.

The Chairman intends to vote in favour of all of the resolutions in relation to undirected proxies.

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You must either mark the boxes directing your proxy how to vote or mark the box indicating that you do not wish to direct your proxy how to vote, otherwise this appointment of proxy form may be held invalid.

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

If two proxies are being appointed, the proportion of voting rights this proxy represents is __%.

Signed this	day of	2008
By:	Individuals and joint holders	Companies (affix common seal if appropriate)
Signature	______	Director _________
Signature	_______	Director/Company Secretary __________
Signature	______	Sole Director and Sole Company Secretary _____

Instructions for Completing Appointment of Proxy Form

1. A Shareholder entitled to attend and vote at a general meeting is entitled to appoint not more than two proxies to attend and vote on their behalf. Where more than one proxy is appointed, such proxy must be allocated a proportion of the Shareholder's voting rights. If the Shareholder appoints two proxies and the appointment does not specify this proportion, each proxy may exercise half the votes.

2. A duly appointed proxy need not be a Shareholder of the Company. In the case of joint holders, all must sign.

3. Corporate Shareholders should comply with the execution requirements set out on the Proxy Form or otherwise with the provisions of Section 127 of the Corporations Act. Section 127 of the Corporations Act provides that a company may execute a document without using its common seal if the document is signed by:

4. 2 directors of the company;

5. a director and a company secretary of the company; or

6. for a proprietary company that has a sole director who is also the sole company secretary - that director.

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

1. Completion of a Proxy Form will not prevent individual Shareholders from attending the meeting in person if they wish. Where a Shareholder completes and lodges a valid proxy form and attends the meeting in person, then the proxy's authority to speak and vote for that Shareholder is suspended while the Shareholder is present at the meeting.

2. Where a Proxy Form or form of appointment of corporate representative is lodged and is executed under power of attorney, the original power of attorney, or certified copy thereof, must be lodged in like manner as this proxy.

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