TALIUS GROUP LIMITED — AGM Information 2013

Apr 28, 2013

ADVANCE ENERGY LIMITED

ACN 111 823 762

NOTICE OF ANNUAL GENERAL MEETING

An Annual General Meeting of the Company will be held at Suite 2, 16 Ord Street West Perth, Western Australia on 31[st] May 2013 at 10:30 AM (WST).

This Notice of Annual General Meeting should be read in its 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.

Should you wish to discuss any matter please contact the Company Secretary on (08) 9429 2900.

IMPORTANT INFORMATION

TIME AND PLACE OF MEETING

Notice is given that the Annual General Meeting of Shareholders of Advance Energy Limited (“ Advance ” or “ Company ”) to which this Notice of Meeting relates will be held at Suite 2, 16 Ord Street West Perth, Western Australia on 31[st] May 2013 at 10:30 AM (WST) (“ Meeting ”).

YOUR VOTE IS IMPORTANT

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

VOTING ELIGIBILITY

The Directors have determined pursuant to Regulation 7.11.37 of the Corporations Regulations 2001 (Cth) that the persons eligible to vote at the Annual General Meeting are those who are registered Shareholders of the Company at 10:30 AM (WST) on 29[th] May 2013.

VOTING IN PERSON

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

VOTING BY PROXY

To vote by proxy, please complete and sign the enclosed Proxy Form and return by the time and in accordance with the instructions set out on the Proxy Form.

New sections 250BB and 250BC of the Corporations Act came into effect on 1 August 2011 and apply to voting by proxy on or after that date. Shareholders and their proxies should be aware of these changes to the Corporations Act, as they will apply to this Annual General Meeting. Broadly, the changes mean that:

• if proxy holders vote, they must cast all directed proxies as directed; and

• any directed proxies which are not voted will automatically default to the Chair, who must vote the proxies as directed.

Further details on these changes are set out below.

Proxy vote if appointment specifies way to vote

Section 250BB(1) of the Corporations Act provides that an appointment of a proxy may specify the way the proxy is to vote on a particular resolution and, if it does :

• the proxy need not vote on a show of hands, but if the proxy does so, the proxy must vote that way (i.e. as directed); and

• if the proxy has 2 or more appointments that specify different ways to vote on the resolution – the proxy must not vote on a show of hands; and

• if the proxy is the chair of the meeting at which the resolution is voted on – the proxy must vote on a poll, and must vote that way (i.e. as directed); and

• if the proxy is not the chair – the proxy need not vote on the poll, but if the proxy does so, the proxy must vote that way (i.e. as directed).

Transfer of non-chair proxy to chair in certain circumstances

Section 250BC of the Corporations Act provides that, if:

• an appointment of a proxy specifies the way the proxy is to vote on a particular resolution at a meeting of the Company's members; and

• the appointed proxy is not the chair of the meeting; and

• at the meeting, a poll is duly demanded on the resolution; and

• either of the following applies:

• the proxy is not recorded as attending the meeting;

• the proxy does not vote on the resolution,

• the chair of the meeting is taken, before voting on the resolution closes, to have been appointed as the proxy for the purposes of voting on the resolution at the meeting.

The accompanying Explanatory Statement and the Proxy and Voting instructions form part of this Notice of Meeting.

ADVANCE ENERGY LIMITED

A C N 0 9 2 3 0 4 9 6 4

NOTICE OF ANNUAL GENERAL MEETING

Notice is hereby given that the Annual General Meeting of Shareholders of Advance Energy Limited ( Advance or Company ) will be held at Suite 2, 16 Ord St West Perth, , WA on Thursday 31[st] May 2013 at 10:30 AM (WST) ( Meeting ).

The Explanatory Memorandum to this Notice of Annual General Meeting provides additional information on matters to be considered at the Annual General Meeting. The Explanatory Memorandum and Proxy Form are part of this Notice.

The Directors have determined pursuant to regulation 7.11.37 of the Corporations Regulations 2001 (Cth) that the persons eligible to vote at the Annual General Meeting are those who are registered as Shareholders of the Company on Tuesday 29[th] May 2013 at 10:30 AM (WST).

Terms and abbreviations used in this Notice and Explanatory Memorandum are defined in the ‘Definitions’ section of the Explanatory Memorandum.

AGENDA

ORDINARY BUSINESS

Financial, Directors' and Auditor's Reports

To receive and consider the Financial Report, Directors' Report and Auditor's Report for the financial year ended 31 December 2012.

1. Resolution 1 – Remuneration Report

To consider, and if thought fit, pass, with or without amendment, the following resolution as a non-binding resolution :

"That, for the purposes of Section 250R(2) of the Corporations Act and for all other purposes approval is given for the adoption of, the Remuneration Report as contained in the Company’s annual financial report for the financial year ended 31 December 2012.”

Note: the vote on this Resolution is advisory only and does not bind the Directors or the Company.

Voting Prohibition Statement:

A vote on this Resolution must not be cast (in any capacity) by or on behalf of any of the following persons:

• (a) a member of the Key Management Personnel, details of whose remuneration are included in the Remuneration Report; or

• (b) a Closely Related Party of such a member.

However, a person described above may vote on this Resolution if:

• (a) the person does so as a proxy appointed by writing that specifies how the proxy is to vote on the Resolution; and

• (b) the vote is not cast on behalf of a person described in sub-paragraphs (a) or (b) above.

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2. Resolution 2 – Election of Mr Alistair Jobling as Director

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

"To elect Mr Alistair Jobling, who, having been appointed a director of the Company since the last Annual General Meeting, retires in accordance with the Company’s Constitution and the ASX Listing Rules and, being eligible, offers himself for election."

3. Resolution 3 – Approval of Amendments to Note Conditions

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

" That, subject to Noteholder Approval being obtained, for the purposes of Listing Rule 7.1 and for all other purposes, Shareholders approve the amendments to the Note Conditions in the manner described in the Explanatory Memorandum.”

Voting Exclusion

The Company will disregard any votes cast on this Resolution by any person who is a holder of Convertible Notes and any of their associates. However, the Company will not disregard a vote if:

• (a) it is cast by the person as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form; or

• (b) 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.

4. Resolution 4 – Ratification of Prior Issues of Shares

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

“That, pursuant to and in accordance with Listing Rule 7.4 and for all other purposes, Shareholders ratify the allotment and issue of 97,583,333 Shares to investors who have been identified by the Company as falling within one or more of the classes of exemptions specified in section 708 of the Corporations Act on the terms and conditions set out in the Explanatory Memorandum.”

Voting Exclusion

The Company will disregard any votes cast on this Resolution by a person (and any associates of such a person) who has participated in the issue.

However, the Company will not disregard a vote if:

• (a) it is cast by the person as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form; or

• (b) 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.

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5. Resolution 5 – Approval of 10% Placement Facility

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

"That, in accordance with Listing Rule 7.1A and for all other purposes, Shareholders approve the issue of Equity Securities of up to 10% of the issued capital of the Company (at the time of the issue) calculated in accordance with the formula prescribed in Listing Rule 7.1A.2 and on the terms and conditions in the Explanatory Memorandum."

Voting Exclusion

The Company will disregard any votes cast on this Resolution by a person (and any associates of such a person) who may participate in the 10% Placement Facility and a person who might obtain a benefit if this Resolution is passed, except a benefit solely in the capacity of a holder of Shares, and any associate of that person (or those persons).

The Company will not disregard a vote if:

• (a) it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form; or

it is cast by the Chairman 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

BY ORDER OF THE BOARD

Company Secretary Dated: 27[th] April 2013

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Advance Energy Limited

ACN 092 304 964

EXPLANATORY MEMORANDUM

This Explanatory Memorandum has been prepared for the information of Shareholders of the Company in connection with the business to be conducted at the Annual General Meeting to be held at Suite 2, 16 Ord St West Perth, WA on Thursday 31[st] May 2013 at 10:30 AM (WST)

This Explanatory Memorandum should be read in conjunction with and forms part of the accompanying Notice. The purpose of this Explanatory Memorandum is to provide information to Shareholders in deciding whether or not to pass the Resolution in the Notice.

A Proxy Form is located at the end of the Explanatory Memorandum.

1. Action to be taken by Shareholders

Shareholders should read the Notice and Explanatory Memorandum carefully before deciding how to vote on the Resolutions.

A Proxy Form is attached to the Notice. This is to be used by Shareholders if they wish to appoint a representative (" proxy ") to vote in their place. All Shareholders are invited and encouraged to attend the Annual General Meeting or, if they are unable to attend in person, sign and return the Proxy Form to the Company in accordance with the instructions thereon. Lodgement of a Proxy Form will not preclude a Shareholder from attending and voting at the Annual General Meeting in person.

2. Financial, Directors' and Auditor's Reports

In accordance with the Constitution, the business of the Annual General Meeting will include receipt and consideration of the annual financial report of the Company for the financial year ended 31 December 2012 together with the declaration of the directors, the directors’ report, the remuneration report and the auditor’s report.

Shareholders will be offered the opportunity to discuss the Financial Report, Directors' Report and Auditor's Report for the financial year ended 31 December 2012, copies of which will be available on the Company's website at www.advanceenergyltd.com.au from 1 April 2013. The Company will not provide a hard copy of the Company’s annual financial report to Shareholders unless specifically requested to do so. There is no requirement for Shareholders to approve these reports.

Shareholders will also be given a reasonable opportunity to ask the auditor questions about the conduct of the audit and the preparation and content of the Auditor’s Report, the accounting policies adopted by the Company in relation to the preparation of the financial statements and the independence of the auditor in relation to the conduct of the audit. As a Shareholder, you are entitled to submit one written question to the auditor prior to the Meeting provided that the question relates to:

• (a) the content of the Auditor’s Report; or

• (b) the conduct of the audit in relation to the Financial Report.

All written questions must be received by the Company no later than 5 business days before the Meeting. All questions must be sent to the Company and must not be sent directly to the auditor. The Company will then forward all questions to the auditor. The auditor will answer all written questions submitted prior to the deadline stated above. Copies of the questions, if any, submitted to the Company’s auditor will be available at the meeting and posted on the Company’s website.

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3. Resolution 1 –Remuneration Report

3.1 General

Pursuant to section 250R(2) of the Corporations Act, the Company is required to put the Remuneration Report to a non-binding vote of Shareholders. The Annual Report contains a Remuneration Report which sets out the remuneration policy for the Company and reports the remuneration arrangements in place for the Managing Director, specified executives and nonexecutive Directors, where applicable. The Annual Report will be available on the Company's website at www.advanceenergyltd.com.au from 1 April 2013.

The provisions of the Corporations Act dealing with the non-binding vote on the remuneration report have recently been amended. The Corporations Act still provides that Resolution 1 need only be an advisory vote of Shareholders and does not bind the directors. However, the Board will take the outcome of the vote into consideration when considering the remuneration policy.

In addition, the Corporations Act amendments now set out a ‘two strikes’ re-election process. Under the ‘two strikes’ re-election process, if the Company’s remuneration report receives a ‘no’ vote of 25% or more of all votes cast at two consecutive Annual General Meetings (that is, ‘two strikes’), a resolution (the “spill resolution”) must be put to the second Annual General Meeting, requiring Shareholders to vote on whether the Company must hold another general meeting (known as the ‘spill meeting’) to consider the appointment of all of the Directors who stand for re-appointment (other than the Managing Director). If the spill resolution is approved by a simple majority of 50% or more of the eligible votes cast, the ‘spill meeting’ must be held within 90 days of that second Annual General Meeting (unless none of the Directors, other than the Managing Director, stand for re-appointment). Further information will be provided on the ‘spill resolution’ and the ‘spill meeting’ for any Annual General Meeting at which the Company may face a ‘second strike’.

The Remuneration Report sets out the Company’s remuneration arrangements for the Directors and senior management of the Company. The Remuneration Report is part of the Directors’ report contained in the annual financial report of the Company for the financial year ending 31 December 2012.

The remuneration levels for directors, officer and senior managers are competitively set to attract and retain appropriate directors and key management personnel.

The chairman of the Meeting will allow a reasonable opportunity for Shareholders as a whole to ask about, or make comments on, the Remuneration Report.

The Board unanimously recommends that Shareholders vote in favour of Resolution 1.

3.2 Voting Restriction for Key Management Personnel

A vote on Resolution 1 must not be cast (in any capacity) by or on behalf of any of the following persons:

• (a) a member of the Key Management Personnel, details of whose remuneration are included in the Remuneration Report; or

• (b) a Closely Related Party of such a member.

However, a person described above may vote on this Resolution if:

• (a) the person does so as a proxy appointed by writing that specifies how the proxy is to vote on the Resolution; and

• (b) the vote is not cast on behalf of a person described in sub-paragraphs (a) or (b) above.

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3.3 Voting Restrictions where Proxy is Key Management Personnel

Pursuant to the Corporations Act, if you elect to appoint a member of Key Management Personnel or any Closely Related Party as your proxy to vote on this Resolution 1, you must direct the proxy how they are to vote. Where you do not direct the member of Key Management Personnel or Closely Related Party on how to vote on this Resolution 1, the proxy is prevented by the Corporations Act from exercising your vote and your vote will not be counted in relation to this Resolution 1.

4. Resolution 2 – Election of Alistair Jobling as a Director

Clause 6.1 of the Constitution allows the Directors to appoint at any time a person to be a Director as an addition to the existing Directors, but only where the total number of Directors does not at any time exceed the maximum number specified by the Constitution.

Any Director so appointed holds office only until the next following annual general meeting and is then eligible for re-election.

Pursuant to the Constitution, Mr Alistair Jobling will retire in accordance with Section 3 (3) and being eligible seeks re-election.

The current board unanimously supports Mr Jobling’s re-appointment.

Mr. Jobling was appointed a Director of the Company on 12 December 2012. Mr Jobling has a Bachelor of Science with Honours majoring in zoology from the University of Nottingham, a Masters in Business Administration from the University of Edinburgh and has obtained a Graduate Diploma in Applied Finance, majoring in Corporate Finance, from Kaplan. His zoology studies included the biotechnology-focussed disciplines of biochemistry, genetics and immunology.

Alistair’s commercial experience includes three years as a consultant with a ‘Big 4’ accounting firm where he undertook strategic reviews, business planning, feasibility studies and capital raising documents. Since 2007, he has provided a range of services for listed companies including company secretarial, compliance and financial analysis.

He is a Director of Acuvax Ltd and is also Company Secretary of Advance Energy Ltd.

5. Resolution 3 – Approval of Amendments to Note Conditions

5.1 Background

As at the date of the Notice, the Company has on issue 6,630,000 listed convertible notes ( Convertible Notes ).

The Convertible Notes are subject to and conditional upon the terms of a trust deed dated 13 October 2009 between the Company and The Trust Company (Australia) Limited ( Trustee ) as varied by a deed of variation dated 29 October 2009 and varied again by a deed of variation on 21 March 2012 ( Trust Deed ).

The terms and conditions of the Convertible Notes are in schedule 1 of the Trust Deed ( Note Conditions ). A summary of the Convertible Note Terms were also detailed in:

• (a) the prospectus of the Company lodged with ASIC and ASX on 28 October 2009; and

• (b) the Company's notice of general meeting dated 23 December 2009.

5.2 Details of Amendments to Note Conditions

The Company is proposing to amend the Note Conditions as follows:

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(a) Conversion Price

The Note Conditions currently provide that, upon a Noteholder electing to convert their Convertibles Notes into Shares, each Convertible Note will convert into such number of Shares as is equal to the Face Value ($1.00) divided by the price per Share which is the lesser of $0.08 and the price per Share which is 80% of the volume weighted average price of Shares traded on ASX in the 30 trading days in which trading occurred preceding the date that a notice of conversion is given.

Because the Company’s shares cannot trade any lower than $0.001, the lowest price at which the Convertible Notes can be converted is 80% of $0.001 or $0.0008 (0.08 cents).

The Company is seeking to fix the Conversion Price so that the Noteholders or parties seeking to purchase Convertible Notes have certainty over the Conversion Price.

(b) Conversion Date

The Company also seeks approval to remove the limitations on when Noteholders are able to convert their Convertible Notes, which is currently restricted to 30 June and 31 December.

The specific proposed amendments to be made to the Note Conditions are detailed in Schedule 2. Such amendments will be effected by the amendment of the Trust Deed.

Under Resolution 3, Shareholders are being asked to approve the amendments to the Note Conditions in Schedule 2. The effect of passing Resolution 3 is that the Company and the Trustee will execute a deed of variation in respect to the Trust Deed to effect the amendments detailed in Schedule 2.

5.3

Noteholder Approval

In accordance with the Trust Deed, variation of the Note Conditions must be approved by the passing of special resolution at a meeting of Noteholders by a majority consisting of not less than 75% of the persons voting at the meeting upon a show of hands or if a poll is duly demanded then by a majority consisting of Noteholders representing not less than 75% of the aggregate value of all of the Convertible Notes held by the Noteholders who are present at the meeting in person, by proxy or representative ( Noteholder Approval ).

However, in accordance with Clause 13.1 of the Trust Deed, the Company and the Trustee may amend the Trust Deed without Noteholder Approval if, in the opinion of the Trustee such amendment, is not reasonably likely to be materially prejudicial to the interests of the Noteholders and two directors of the Company on behalf of the directors of the Company have so certified to the Trustee.

The Company has advised the Trustee that, in the opinion of the directors, the proposed amendments are not materially prejudicial to the interests of the Noteholders and has sought the consent of the Trustee to amend the Trust Deed accordingly without obtaining the approval of Noteholders. The Trustee has advised that it will seek legal advice confirming that the proposed amendments are not prejudicial and that, subject a satisfactory opinion and the preparation of an appropriate deed of amendment, it would approve the proposed amendments.

5.4 Capital Structure and Dilution

The following information is provided to Shareholders to assist them in considering Resolution 3:

• (a) Capital Structure

As at the date of the Notice, the Company has on issue:

• (i) 1,255,586,172 Shares (including 97,583,333 Shares issued between 29 May 2012 and 7 December 2012 that are subject to ratification by Shareholders pursuant to Resolution 4);

• (ii) 6,630,000 Convertible Notes.

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• (b) Market Price of Shares and Note Conversion

The lowest and highest market sale prices of Shares on the ASX during the 4 months immediately preceding the Notice was $0.001. The last sales price for Shares on the ASX on 15 April 2013 was $0.001.

(c) Dilution

The following table provides the capital structure of the Company if all of the Convertible Notes were to be converted at $0.0008 (0.08 cents) per Share.

Conversion Price ($)	Shares Issued
Current Shares on issue (incl Shares issued pursuant to Prior Placements (Resolution 4)	1,255,586,172
Shares issued on conversion of 100% of the Convertible Notes	8,288,125,000
Capitalisation of Interest	1,377,900,000
Total Shares on issue	10,921,611,172
*Potential Dilution of Shareholders **	89%

• The table assumes that Resolutions 3 and 4 are approved by Shareholders. The table also includes Shares that may be issued pursuant to the Capitalisation of Interest (refer to Section 3.2(b)) and is based on approximate quarterly payments of $157,000 (of which there are 7 interest payment dates from the date of this Notice until the Maturity Date) calculated at the indicative Share price stated above. Note that any Shares issued pursuant to the Capitalisation of Interest are to be issued at a price of a 5 day 80% VWAP prior to the date of issue.

It should be noted that, pursuant to the Note Conditions, a Noteholder is not entitled to convert (and the Company is entitled to refuse to convert) such number of Convertible Notes that would result in:

(d) a person acquiring voting Shares in the Company in breach of section 606 of the Corporations Act (or any equivalent provision); or

• (e) a person acquiring Shares where a notification being required to be sent under, or consent is required under, any legislation by which the Company or its Related Bodies Corporate are bound.

5.5 Rationale for amendments to the Note Conditions

• (a) Conversion Price - Proposed

The proposed change to the conversion price will allow Noteholders to convert their Convertible Notes at no greater than $0.0008 (0.08 cents).

• (b) Conversion Price - Current

Under the existing Note Conditions, Noteholders are entitled to convert their Convertible Notes into Shares at the lesser of:

• (i) the price per Share which is 80% of the volume weighted average price of Shares traded on ASX in the 30 trading days in which trading occurred preceding the date that a notice of conversion is given; or

• (ii) $0.08.

• (c) Analysis of the Proposed Change to Conversion Price

When compared to the current Conversion Price, the proposed amendment sets the price at which the Convertible Notes may be converted at $0.0008:

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The presence of the Convertible Notes is currently an impediment to the Company being able to raise additional funds, as potential investors forsee the potential issue of a significant number of shares that may have a dilutive effect on the Company’s share price.

By locking in a Conversion Price of $0.0008 and providing Noteholders with the freedom to convert their Listed Notes whenever they wish, the Company hopes to remove a disincentive to the holders or potential purchasers of Listed Convertible Notes from converting.

The proposed changes are favourable to Noteholders and potentially less favourable to Shareholders as they may result in Noteholders being able to convert at a lower price than might be the case under the current formula. However, the Board is of the view that the Company’s share price is unlikely to rise significantly while the current Conversion Terms remain in place.

(d) Change of Conversion Date

Under the Trust Deed, Noteholders may convert all or part of their Listed Convertible Notes on either 30 June or 31 December (Conversion Dates) by delivering a Conversion Notice on or before the Conversion Dates.

This constitutes a restriction on the ownership of Convertible Notes

The proposed change to the Note Conditions allowing the Company to issue Shares to satisfy interest payments will reduce the Company’s cash outflows by $634,125 per annum. This is considered less favourable to Noteholders but favourable to Shareholders, as it preserves cash and caps the discount on Share price at which Shares will be issued to satisfy interest payments.

This amendment to the Note Conditions is intended to encourage secondary trading of Listed Notes and to encourage Noteholders to convert their Convertible Notes. This in turn is expected to remove impediments to the Company’s capital raising activities.

5.6 Consequences if the Resolution is not approved

If Shareholders do not approve Resolution 3, there will be no change to the existing terms and conditions of the Convertible Notes. The maturity date (31 December 2014) will remain unchanged and the Company will continue to issue shares in lieu of interest payable. The Company believes that it is in the best interests of both Noteholders and Shareholders for it to preserve cash and to utilise these funds to developing new opportunities that could add value to the Company.

5.7 Listing Rule 7.1

Listing Rule 7.1 provides that without Shareholder approval, the Company must not issue or agree to issue equity securities comprising more than 15% of the Company's issued capital as at 12 months before the date of issue of the relevant securities, subject to certain additions and subtractions.

It is the view of the Company that Shareholder approval is required under Listing Rule 7.1 for the proposed amendments to the Note Conditions. This approval is sought in Resolution 1.

ASX considers that the proposed amendments to the Note Conditions to change the conversion price is akin to a new issue of convertible notes because they will provide Noteholders with a new, discounted conversion price which is a price different to that originally approved by Shareholders.

Resolution 3 is an ordinary resolution.

5.8

Specific information required by Listing Rule 7.3

If Resolution 3 becomes effective, it will not result in the issue of additional Convertible Notes. Rather, Noteholders will be able to convert their Convertible Notes into Shares based on the new conversion price summarised in Section 5.2 (a).

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All of the proposed amendments to the Note Conditions and conditions are summarised in Section 5.2.

There will be no new allottees if Resolution 3 becomes effective.

No funds will be raised by the proposed amendments to the Note Conditions.

6. Resolution 4 – Ratification of Prior Issue of Shares

6.1 General

Since 20 April 2012, he Company has issued 119,583,333 Shares without shareholder approval in accordance with the schedule below to raise $380,000 ( Prior Placements ) in cash and to pay for the provision of a research report and marketing services.

Date	Number Issued	Issue Price	**Consideration **
29 May 2012	25,000,000(1)	$0.004	$100,000
10 July 2012	10,000,000	$0.004	$40,000
24 July 2012	5,000,000	$0.004	$20,000
9August2012	6,250,000	$0.004	$25,000 (2)
7 December 2012	73,333,333	$0.003	$220,000
TOTAL	119,583,333		$405,000

• (1) 22,000,000 shares were ratified at the General Meeting on 24 July 2012

• (2) Shares issued as share-based payment for the provision of a research report and marketing services

Resolution 4 seeks Shareholder ratification of the issue of the Prior Placements pursuant to Listing Rule 7.4.

6.2

Listing Rule 7.4

The 97,583,333 Shares were issued within the 15% annual limit permitted under Listing Rule 7.1, without the need for Shareholder approval.

Listing Rule 7.4 provides that where a company in a Meeting ratifies the previous issue of securities made pursuant to Listing Rule 7.1 (and provided that the previous issue did not breach Listing Rule 7.1) those securities will be deemed to have been made with shareholder approval for the purpose of Listing Rule 7.1.

The effect of Shareholders passing Resolution 4 by ratifying the issue of the Shares will be to restore the Company’s ability to issue further securities, to the extent of 97,583,333 Shares, during the next 12 months.

Resolution 4 is an ordinary resolution.

6.3

Technical information required by Listing Rule 7.4

Pursuant to and in accordance with Listing Rule 7.5, information is provided as follows:

• (a) 97,583,333 Shares were issued in accordance with the table above;

• (b) The Shares were issued at the prices shown in the table above;

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• (c) the Shares issued are all fully paid ordinary shares in the capital of the Company and rank equally in all respects with the Company’s existing Shares on issue issued;

• (d) the Shares were issued by way of a placement to investors falling within one or more of the classes of exemptions specified in Section 708 of the Corporations Act. None of the subscribers are related parties of the Company and no subscriber holds an interest of 20% or greater in the capital of the Company as a result of the issue of the Shares; and

• (e) the Company has used the funds raised from this capital raising for working capital purposes.

• (f) a voting exclusion statement is included in the Notice.

6.4 Interests and Recommendations of Directors

None of the Directors have an interest in the outcome of Resolution 4. Each of the Directors approved the proposal to put the Resolution 4 to Shareholders and each of the Directors recommends that Shareholders vote in favour of the Resolution 4.

7. Resolution 5 – Approval of 10% Placement Facility

7.1 General

Listing Rule 7.1A enables eligible entities to issue Equity Securities up to 10% of its issued share capital through placements over a 12 month period after the annual general meeting ( 10% Placement Facility ). The 10% Placement Facility is in addition to the Company's 15% placement capacity under Listing Rule 7.1.

An eligible entity for the purposes of Listing Rule 7.1A is an entity that is not included in the S&P/ASX 300 Index and has a market capitalisation of $300 million or less. The Company is an eligible entity.

The Company is now seeking Shareholder approval by way of a special resolution to have the ability to issue Equity Securities under the 10% Placement Facility. The number of Equity Securities to be issued under the 10% Placement Facility will be determined in accordance with the formula prescribed in Listing Rule 7.1A.2 (refer to Section (c) of commentary on Listing Rule 7.1A immediately below).

The Directors of the Company believe that Resolution 5 is in the best interests of the Company and unanimously recommend that Shareholders vote in favour of this Resolution.

Resolution 5 is a special resolution and therefore requires approval of 75% of the votes cast by Shareholders present and eligible to vote (in person, by proxy, by attorney or, in the case of a corporate Shareholder, by a corporate representative).

The Chairman intends to exercise all available proxies in favour of Resolution 5.

7.2

Listing Rule 7.1A

(a) Shareholder approval

The ability to issue Equity Securities under the 10% Placement Facility is subject to Shareholder approval by way of a special resolution at an annual general meeting.

(b) Equity Securities

Any Equity Securities issued under the 10% Placement Facility must be in the same class as an existing quoted class of Equity Securities of the company.

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As at the date of the Notice, the Shares are the only class of Equity Securities issued by the Company.

(c)

Formula for calculating 10% Placement Facility

Listing Rule 7.1A.2 provides that eligible entities which have obtained Shareholder approval at an annual general meeting may issue or agree to issue, during the 12 month period after the date of the annual general meeting, a number of Equity Securities calculated in accordance with the following formula:

(A x D) – E

• A is the number of shares on issue 12 months before the date of issue or agreement:

• (1) plus the number of fully paid shares issued in the 12 months under an exception in Listing Rule 7.2;

• (2)

• plus the number of partly paid shares that became fully paid in the 12 months;

• (3) plus the number of fully paid shares issued in the 12 months with Shareholder approval under Listing Rule 7.1 and 7.4. This does not include an issue of fully paid shares under the entity's 15% placement capacity without Shareholder approval;

• (4)

• less the number of fully paid shares cancelled in the 12 months.

Note that A has the same meaning in Listing Rule 7.1 when calculating an entity's 15% placement capacity.

• D is 10%

• E is the number of Equity Securities issued or agreed to be issued under Listing Rule 7.1A.2 in the 12 months before the issue date or date of agreement to issue that are not issued with the approval of holders of ordinary securities under Listing Rule 7.1 or 7.4.

(d)

Listing Rule 7.1 and Listing Rule 7.1A

The ability of an entity to issue Equity Securities under Listing Rule 7.1A is in addition to the entity's 15% placement capacity under Listing Rule 7.1.

At the date of the Notice, the Company has on issue 1,255,586,172 Shares and therefore has a capacity to issue:

• (i) 188,379,250 Equity Securities under Listing Rule 7.1; and

• (ii) subject to Shareholder approval being sought under Resolution 5, 229,296,892 Equity Securities under Listing Rule 7.1A.

The actual number of Equity Securities that the Company will have capacity to issue under Listing Rule 7.1A will be calculated at the date of issue of the Equity Securities in accordance with the formula prescribed in Listing Rule 7.1A.2 (refer to Section (c) of commentary on Listing Rule 7.1A immediately above).

(e)

Minimum Issue Price

The issue price of Equity Securities issued under Listing Rule 7.1A must be no less than 75% of the volume weighted average price ( VWAP ) for Equity Securities in that class calculated over the 15 Trading Days on which trades in that class were recorded immediately before:

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• (i) the date on which the price at which the Equity Securities are to be issued is agreed; or

• (ii) if the Equity Securities are not issued within 5 trading days of the date in paragraph (i) above, the date on which the Equity Securities are issued.

(f)

10% Placement Period

Shareholder approval of the 10% Placement Facility under Listing Rule 7.1A is valid from the date of the annual general meeting at which the approval is obtained and expiring on the first to occur of the following:

• (i) the date that is 12 months after the date of the annual general meeting at which the approval is obtained; or

• (ii) the date of approval by holders of the eligible entity’s ordinary securities of a transaction under Listing Rules 11.1.2 (a significant change to the nature or scale of activities) or 11.2 (disposal of main undertaking),

or such longer period as allowed by ASX ( 10% Placement Period ).

7.3 Listing Rule 7.1A

The effect of Resolution 5 will be to allow the Directors to issue the Equity Securities under Listing Rule 7.1A during the 10% Placement Period without using the Company’s 15% placement capacity under Listing Rule 7.1.

7.4

Specific information required by Listing Rule 7.3A

In accordance with Listing Rule 7.3A, information is provided as follows:

• (a) The Equity Securities will be issued at an issue price of not less than 75% of the VWAP for the Company's Equity Securities over the 15 Trading Days on which trades in that class were recorded immediately before:

• (i) the date on which the price at which the Equity Securities are to be issued is agreed; or

• (ii) if the Equity Securities are not issued within 5 Trading Days of the date in paragraph (i) above, the date on which the Equity Securities are issued.

• (b) If Resolution 5 is approved by Shareholders and the Company issues Equity Securities under the 10% Placement Facility, the existing Shareholders' voting power in the Company will be diluted as shown in the below table. There is a risk that:

• (i) the market price for the Company's Equity Securities may be significantly lower on the date of the issue of the Equity Securities than on the date of the Meeting; and

• (ii) the Equity Securities may be issued at a price that is at a discount to the market price for the Company's Equity Securities on the issue date or the Equity Securities are issued as part of consideration for the acquisition of a new asset,

which may have an effect on the amount of funds raised by the issue of the Equity Securities.

• (c) The below table shows the dilution of existing Shareholders on the basis of the current market price of Shares and the current number of ordinary securities for variable "A" calculated in accordance with the formula in Listing Rule 7.1A(2) as at the date of the Notice.

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• (d) The table also shows:

• (i) two examples where variable “A” has increased, by 50% and 100%. Variable “A” is based on the number of ordinary securities the Company has on issue. The number of ordinary securities on issue may increase as a result of issues of ordinary securities that do not require Shareholder approval (for example, a pro rata entitlements issue or scrip issued under a takeover offer or conversion of convertible securities) or future specific placements under Listing Rule 7.1 that are approved at a future Shareholders’ meeting; and

• (ii) two examples of where the issue price of ordinary securities has decreased by approximately 50% and increased by approximately 50% as against the current market price.

• (iii) An example where variable “A” is increased as a result of the conversion of 100% of the Convertible Notes as described in Section 5.4 c) but excluding any Shares issued as a result of the capitalisation of interest.

Variable 'A' in Listing Rule 7.1A.2			Dilution
		$0.0005 50% decrease in Issue Price	$0.001 Issue Price	$0.0015 50% increase in Issue Price
Current Variable A 1,255,586,172 Shares	10% Voting Dilution	125,558,617 Shares	125,558,617 Shares	125,558,617 Shares
	Funds raised	$62,779	$125,559	$188,338
50% increase in current Variable A 1,883,379,258 Shares	10% Voting Dilution	188,337,926 Shares	188,337,926 Shares	188,337,926 Shares
	Funds raised	$94,169	$188,338	$282,507
100% increase in current Variable A 2,511,172,344 Shares	10% Voting Dilution	251,117,234 Shares	251,117,234 Shares	251,117,234 Shares
	Funds raised	$125,559	$251,117	$376,676
Conversion of Convertible Notes (See 5.4) Variable A 9,543,711,172 Shares	10% Voting Dilution	954,371,117 Shares	954,371,117 Shares	954,371,117 Shares
	Funds raised	$477,186	$954,371	$1,431,557

The table has been prepared on the following assumptions:

(i) The Company issues the maximum number of Equity Securities available under the 10% Placement Facility.

• (ii) The 10% voting dilution reflects the aggregate percentage dilution against the issued share capital at the time of issue. This is why the voting dilution is shown in each example as 10%.

• (iii) The table does not show an example of dilution that may be caused to a particular Shareholder by reason of placements under the 10% Placement Facility, based on that Shareholder’s holding at the date of the Meeting.

• (iv) The table shows only the effect of issues of Equity Securities under Listing Rule 7.1A, not under the 15% placement capacity under Listing Rule 7.1.

• (v) The issue of Equity Securities under the 10% Placement Facility consists only of Shares.

• (vi) The issue price is $0.001, being the closing price of the Shares on ASX on 15 April 2013.

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• (c) The Company will only issue and allot the Equity Securities during the 10% Placement Period. The approval under Resolution 5 for the issue of the Equity Securities will cease to be valid in the event that Shareholders approve a transaction under Listing Rule 11.1.2 (a significant change to the nature or scale of activities or Listing Rule 11.2 (disposal of main undertaking).

• (d) The Company may seek to issue the Equity Securities for the following purposes:

• (i) non-cash consideration for the acquisition of the new oil and gas assets, investments and payment for the provision of other professional services. In such circumstances the Company will provide a valuation of the non-cash consideration as required by Listing Rule 7.1A.3; or

• (ii) cash consideration. In such circumstances, the Company intends to use the funds raised towards the acquisition of new assets or investments (including expenses associated with such acquisition), for the continued exploration and development of the Company’s Ortynytska project in Ukraine and and/or general working capital.

• (e) The Company will comply with the disclosure obligations under Listing Rules 7.1A(4) and 3.10.5A upon issue of any Equity Securities.

• (f) The Company’s allocation policy is dependent on the prevailing market conditions at the time of any proposed issue pursuant to the 10% Placement Facility. The identity of the allottees of Equity Securities will be determined on a case-by-case basis having regard to the factors including but not limited to the following:

• (ii) the methods of raising funds that are available to the Company, including but not limited to, rights issue or other issue in which existing security holders can participate;

• (iii) the effect of the issue of the Equity Securities on the control of the Company;

• (iv) the financial situation and solvency of the Company; and

• (v) advice from corporate, financial and broking advisers (if applicable).

• (g) The allottees under the 10% Placement Facility have not been determined as at the date of the Notice but may include existing substantial Shareholders and/or new Shareholders who are not a related party or an associate of a related party of the Company.

• (h) Further, if the Company is successful in acquiring new resources assets or investments, it is likely that the allottees under the 10% Placement Facility will be the vendors of the new resources assets or investments.

• (i) The Company has not previously obtained Shareholder approval under Listing Rule 7.1A.

• (j) A voting exclusion statement is included in the Notice for Resolution 5.

8. ENQUIRIES

Shareholders are requested to contact Company Secretary on (08) 9429 2900 if they have any queries in respect of the matters set out in these documents.

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Schedule 1 - Definitions

In this Notice:

$ means Australian dollars.

• 10% Placement Facility has the meaning defined in the Listing Rules

10% Placement Period has the meaning defined in the Listing Rules

Annual Report means the 2012 Annual Report of the Company and its controlled entities (if any) a copy of which was lodged with the ASX.

ASIC means Australian Securities and Investments Commission.

ASX means ASX Limited and where the context permits the Australian Securities Exchange operated by ASX Limited.

Auditor's Report means the auditor's report on the Financial Report.

Board means the Company's current board of Directors.

Business Day means as defined in the Listing Rules.

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 or Advance means Advance Energy Limited ACN 111 823 762.

Convertible Note means a listed convertible note having the Note Conditions.

Constitution means the constitution of the Company.

Corporations Act means the Corporations Act 2001 (Cth).

Director means a director of the Company and Directors means all of them.

Equity Securities has the meaning defined in the Listing Rules

Explanatory Memorandum means this explanatory memorandum accompanying the Notice..

Financial Report means the annual financial report prepared under Chapter 2M of the Corporations Act of the Company and its controlled entities (if any).

Meeting or Meeting has the meaning given in the introductory paragraph of the Notice.

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.

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Listing Rules means the listing rules of ASX.

Note Conditions means the terms and conditions applicable to the Convertible Notes, including the terms and conditions in the Trust Deed and the terms and conditions in Schedule 1 of the Trust Deed.

Noteholder means a registered holder of Convertible Notes.

Noteholder Approval has the meaning in Section 5.3.

Noteholder Resolution means the resolution of Noteholders that is required under the Trust Deed to effect the amendment to the Note Conditions.

Notice or Notice of Meeting or Notice of Annual General Meeting means the Notice of Annual General Meeting to which the Explanatory Memorandum is attached.

Prior Placements means the Placements described in Section 6.1 of this Notice.

Proxy Form means the proxy form attached to the Notice.

Remuneration Report means the remuneration report set out in the Director’s report section of the Company’s annual financial report for the year ended 31 December 2012.

Resolutions means the resolutions set out in the Notice of Meeting, or any one of them, as the context requires.

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

Shareholder means a shareholder of the Company.

VWAP means Volume Weighted Average Price

WST means Western Standard Time as observed in Perth, Western Australia.

In this Notice, words importing the singular include the plural and vice versa.

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Schedule 2 – Amendments to Note Conditions

1. Delete the following definition from Section 1.1 of the Trust Deed in its entirety:

“Conversion Date means for all Convertible Notes included in a Conversion Notice, the earlier to occur of 30 June or 31 December after the Conversion Notice Date and the Maturity Date.”

replace it with:

“ Conversion Date means the date on which a Conversion Notice Deed is received by the Company.”

2. Delete the following in its entirety (paragraph 13 in Schedule 1 of the Trust Deed):

"13. Conversion Rate

Upon exercise of the Conversion Option, each Convertible Note will convert to such number of Shares as is equal to the Face Value divided by the price per Share which is the lesser of $0.08 and the price per Share which is 80% of the volume weighted average price of Shares traded on ASX in the 30 trading days in which trading occurred preceding the date that the Conversion Notice is given”; and

replace it with:

"13. Conversion Rate

Upon exercise of the Conversion Option each Convertible Note will convert to such number of Shares as is equal to the Face Value divided by $0.0008."

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ADVANCE ENERGY LIMITED

ACN 092 304 964

P R O X Y F O R M ANNUAL GENERAL MEETING

The Company Secretary Advance Energy Limited By delivery: By post: By facsimile: Advance Energy Limited Advance Energy Limited 08 9486 1011 Suite 2, 16 Ord Street PO Box 1779 WEST PERTH WA 6005 WEST PERTH WA 6872 I/We_______________

of _________________

being a Shareholder/Shareholders of the Company and entitled to _________

votes in the Company, hereby appoint _____________ OR the Chair of the Annual General Meeting as your proxy

or failing the person so named or, if no person is named, the Chair of the Annual General Meeting, or the Chair’s nominee, to vote in accordance with the following directions, or, if no directions have been given, and subject to the relevant laws as the proxy sees fit, at the Annual General Meeting of the Company to be held at Suite 2, 16 Ord St West Perth, WA on 31[st] May 2012 at 10:30 AM (WST). If 2 proxies are appointed, the proportion or number of votes of this proxy is authorised to exercise is * [ ]% of the Shareholder’s votes*/ [ ] of the Shareholder’s votes. (An additional Proxy Form will be supplied by the Company, on request).

Comment

“Important for Resolution 1: If the Chair of the Meeting or any member of the Key Management Personnel of the Company whose remuneration details are included in the Remuneration Report or a Closely Related Party of that member is your proxy and you have not directed the proxy to vote on Resolution 1, the proxy will be prevented from casting your votes on Resolution 1. If the Chair, another member of the Key Management Personnel of the Company whose remuneration details are included in the Remuneration Report or Closely Related Party of that member is your proxy, in order for your votes to be counted on Resolution 1, you must direct your proxy how to vote on Resolution 1.

OR

Voting on Business of the Annual General Meeting

For Against Abstain

Resolution	1	Adoption of Remuneration Report
Resolution	2	Election of Director
Resolution	3	Amendment of Convertible Note Conditions
Resolution	4	Ratification of Prior Placements
Resolution	5	Approval of 10% Placement Facility

Please note : If you mark the abstain box for a particular Resolution, you are directing your proxy not to vote on that Resolution on a show of hands or on a poll and your votes will 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 %

Authorised signature/s This section must be signed in accordance with the instructions overleaf to enable your voting instructions to be implemented.

Individual or Shareholder 1

Individual or Shareholder 1 Shareholder 2 Shareholder 3 Sole Director and Sole Company Director Director/Company Secretary Secretary ____ ____ _____ Contact Name Contact Daytime Telephone Date

1Insert name and address of Shareholder 2 Insert name and address of proxy *Omit if not applicable

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Instructions for Completing ‘Proxy’ Form

A Shareholder entitled to attend and vote at the Annual General Meeting may appoint a natural person as the Shareholder's proxy to attend and vote for the Shareholder at that Annual General Meeting. If the Shareholder is entitled to cast 2 or more votes at the Annual General Meeting the Shareholder may appoint not more than 2 proxies. Where the Shareholder appoints more than one proxy the Shareholder may specify the proportion or number of votes each proxy is appointed to exercise. If such proportion or number of votes is not specified each proxy may exercise half of the Shareholder's votes. A proxy may, but need not be, a Shareholder of the Company.

If a Shareholder appoints a body corporate as the Shareholder’s proxy to attend and vote for the Shareholder at that Annual General Meeting, the representative of the body corporate to attend the Annual General Meeting must produce the 'Certificate of Appointment of Representative' prior to admission. A form of the certificate may be obtained from the Company’s share registry.

A member may direct a proxy how to vote by marking one of the boxes opposite each item of business. Where a box is not marked the proxy may vote as they choose. Where more than one box is marked on an item the vote will be invalid on that item.

You must sign this form as follows in the spaces provided:

Individual:	Where the holding is in one name, the member must
Joint Holding:	Where the holding is in more than one name all of the holders must sign.
Power of Attorney:	if signed under a power of attorney, you must have already lodged it with the
	registry, or alternatively, attach a certified photocopy of the power of attorney to
	this Proxy Form when you return it.
Companies:	a director can sign jointly with another director or a company secretary. A sole
	director who is also a sole company secretary can also sign. Please indicate the
	office held by signing in the appropriate space.

If a representative of the corporation is to attend the Annual General Meeting the appropriate "Certificate of Appointment of Representative" should be produced prior to admission. A form of the certificate may be obtained from the Company’s share registry.

Completion of a Proxy Form will not prevent individual members from attending the Annual General Meeting in person if they wish. Where a member completes and lodges a valid Proxy Form and attends the Annual General Meeting in person, then the proxy’s authority to speak and vote for that member is suspended while the member is present at the Annual General Meeting.

Proxy Forms (and the power of attorney or other authority, if any, under which the Proxy Form is signed) or a copy or facsimile which appears on its face to be an authentic copy of the Proxy Form (and the power of attorney or other authority) must be deposited at or received by facsimile transmission at the Company's office (Suite 2, 16 Ord Street, West Perth, WA 6005 or Facsimile number 9486 1011 if faxed within Australia or +61 8 9486 1011 if faxed from outside Australia) not later than 48 hours prior to the time of commencement of the Annual General Meeting being 10:30AM (WST) on 31st May 2013.

Proxy forms received later than this time will be invalid.

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