UNION STAR METALS LTD — Proxy Solicitation & Information Statement 2017

Mar 12, 2017

==> picture [151 x 74] intentionally omitted <==

Thred Limited

ACN 124 541 466

Notice of General Meeting

10:00am (WST)

10 APRIL 2017

At Subiaco Business Centre Suite 5, 531 Hay Street, Subiaco Perth, Western Australia

This Notice of Meeting should be read in its entirety. If Shareholders are in doubt as to how they should vote, they should seek advice from their professional advisers prior to voting.

Should you wish to discuss the matters in this Notice of Meeting please do not hesitate to contact the Company Secretary on +61 8 9389 5885.

Table of contents

Table of contents	2
Time and place of Meeting and how to vote	3
Business of the Meeting	5
Resolution 1 – Adoption of Incentive Option Plan	5
Resolution 2 – Variation of terms of Performance Shares	5
Resolution 3 – Ratification of Prior Issues of Securities	5
Resolution 4 – Authority to issue Placement Shares	6
Resolution 5 – Authority to issue Shares to Company Secretary	6
Explanatory Statement	8
Resolution 1 – Adoption of Incentive Option Plan	8
Resolution 2 – Variation of terms of Performance Shares	8
Resolution 3 – Ratification of Prior Issues of Securities	9
Resolution 4 – Authority to Issue Placement Shares	10
Resolution 5 – Authority to Issue Shares to Company Secretary	11
Glossary	13
Proxy Form	Error! Bookmark not defined.
Annexure A –Terms of Promoter Options	15
Annexure B – Terms of Performance Shares	17
Annexure C – Terms of Plan	19

Page | 2

Time and place of Meeting and how to vote

Time and place of Meeting

Notice is given that the General Meeting will be held at 10:00am (WST) on 10 April 2017 at Subiaco Business Centre, Suite 5, 531 Hay Street, Subiaco, Perth, Western Australia.

Your vote is important

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

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

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 General Meeting are those who are registered Shareholders at 5:00pm (WST) on 8 April 2017.

Voting in person

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

Voting by proxy

In accordance with section 249L of the Corporations Act, members are advised that:

• (a) each member has a right to appoint a proxy;

• (b) the proxy need not be a member of the Company; and

• (c) a member who is entitled to cast two or more votes may appoint two proxies and may specify the proportion or number of votes each proxy is appointed to exercise. If the member appoints two proxies and the appointment does not specify the proportion or number of the member's votes, then in accordance with section 249X(3) of the Corporations Act, each proxy may exercise onehalf of the votes.

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.

Sections 250BB and 250BC of the Corporations Act apply to voting by proxy. Shareholders and their proxies should be aware of these sections, as they will apply to this Meeting. Broadly, the sections mean that:

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

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

Further details on these legislative requirements are set out below.

Proxy vote if appointment specifies way to vote

An appointment of a proxy may specify the way the proxy is to vote on a particular resolution and, if it does:

• (a) 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

Page | 3

• (b) 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

• (c) 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

• (d) 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

If:

• (a) 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

• (b) the appointed proxy is not the chair of the meeting; and

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

• (d) either of the following applies:

• (i) the proxy is not recorded as attending the meeting;

• (ii) 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.

Page | 4

Business of the Meeting

Resolution 1 – Adoption of Incentive Option Plan

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

“That for the purpose of ASX Listing Rule 7.2 (Exception 9(b)) and for all other purposes, approval is given for the Company to adopt an employee incentive scheme entitled “Incentive Option Plan” on the terms and conditions set out in the Explanatory Memorandum.”

Voting Exclusion:

The Company will disregard any votes cast on this Resolution by any Director, other than any Directors who are ineligible to participate in any employee incentive scheme in relation to the Company, and any associates of those Directors. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form, or, 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.

Voting Prohibition Statement

A person appointed as a proxy must not vote, on the basis of that appointment, on this Resolution if:

• (a) the proxy is either:

• (i) a member of the Key Management Personnel; or

• (ii) a Closely Related Party of such a member; and

• (iii) the appointment does not specify the way the proxy is to vote on this Resolution.

However, the above prohibition does not apply if:

• (a) the proxy is the Chair; and

• (b) the appointment expressly authorises the Chair to exercise the proxy even though this Resolution is connected directly or indirectly with remuneration of a member of the Key Management Personnel.

Resolution 2 – Variation of terms of Performance Shares

To consider, and if thought fit, to pass the following resolution as a special resolution :

“That for the purposes of section 246B of the Corporations Act, clause 2.4 of the Company’s Constitution and for all other purposes, approval is given for the Company to vary the rights attaching to a class of shares, being the Company’s Performance Shares, on the terms and conditions set out in the Explanatory Statement.”

Resolution 3 – Ratification of Prior Issues of Securities

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

Page | 5

“That for the purpose of Listing Rule 7.4, and for all other purposes, Shareholders ratify the following prior issues of the Company:

• (a) 10,847,819 Shares issued pursuant to ASX Listing Rule 7.1; and

• (b) 20,000,000 Promoter Options issued pursuant to ASX Listing Rule 7.1;

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 who participated in the issues and any associates of those persons. However, the Company need 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

• (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.

Resolution 4 – Authority to issue Placement 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 ASX Listing Rule 7.1 and for all other purposes, approval is given for the Company to allot and issue up to 15,000,000 Placement Shares on the terms and conditions set out in the Explanatory Statement."

Voting Exclusion: The Company will disregard any votes cast on this Resolution by any person who may participate in the proposed issue and a person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities, if the Resolution is passed and any associates of those persons. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form, or, 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.

Resolution 5 – Authority to issue Shares to Company Secretary

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

"That, for the purpose of ASX Listing Rule 7.1 and for all other purposes, approval is given for the Company to issue 250,000 Shares on the terms and conditions set out in the Explanatory Statement."

Voting Exclusion: The Company will disregard any votes cast on this Resolution by any person who may participate in the proposed issue and a person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities, if the Resolution is passed and any associates of those persons. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form, or, 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.

Page | 6

Dated: 10 March 2017

By order of the Board

Damon Sweeny Company Secretary

Page | 7

Explanatory Statement

This Explanatory Statement has been prepared to provide information which the Directors believe to be material to Shareholders in deciding whether or not to pass the Resolutions which are the subject of the business of the Meeting.

Resolution 1 – Adoption of Incentive Option Plan

Resolution 1 seeks Shareholder approval for the adoption of the employee incentive scheme titled Incentive Option Plan ( Plan ) in accordance with ASX Listing Rule 7.2 (Exception 9(b)).

ASX Listing Rule 7.1 provides that a company must not, subject to specified exceptions, issue or agree to issue more equity securities during any 12 month period than that amount which represents 15% of the number of fully paid ordinary securities on issue at the commencement of that 12 month period. ASX Listing Rule 7.2 (Exception 9(b)) sets out an exception to ASX Listing Rule 7.1 which provides that issues under an employee incentive scheme are exempt for a period of 3 years from the date on which shareholders approve the issue of securities under the scheme as an exception to ASX Listing Rule 7.1.

If Resolution 1 is passed, the Company will be able to issue Options under the Plan to eligible participants over a period of 3 years without impacting on the Company's ability to issue up to 15% of its total ordinary securities without Shareholder approval in any 12 month period (subject to any capacity previously used under the Plan pursuant to Resolution 1).

Shareholders should note that no Options have previously been issued under the Plan.

The objective of the Plan is to attract, motivate and retain key employees and it is considered by the Company that the adoption of the Plan and the future issue of Options under the Plan will provide selected employees with the opportunity to participate in the future growth of the Company.

Any future issues of Options under the Plan to a related party or a person whose relation with the Company or the related party is, in ASX's opinion, such that approval should be obtained will require additional Shareholder approval under ASX Listing Rule 10.14 at the relevant time.

A summary of the key terms and conditions of the Plan is set out in Annexure C. In addition, a copy of the Plan is available for review by Shareholders at the registered office of the Company until the date of the Meeting. A copy of the Plan can also be sent to Shareholders upon request to the Company Secretary. Shareholders are invited to contact the Company if they have any queries or concerns.

Resolution 1 is an ordinary resolution.

Resolution 2 – Variation of terms of Performance Shares

2.1 General

The Company currently has on issue 31,500,000 Performance Shares on the terms and conditions specified in Annexure B ( Performance Shares ). These Performance Shares were issued by the Company, pursuant to an offer under its recompliance prospectus dated 16 May 2016, to the Vendor (or its nominee) in consideration for the acquisition of the Thredit Limited (a company incorporated in Hong Kong).

Section 2.4 of the Company’s Constitution provides that the rights attaching to any class (unless otherwise provided by the terms of issue of the Shares of that class) may be varied, whether or not the Company is being wound up:

(a) with the consent in writing of the holders of three quarters of the issued Shares of that class; or

Page | 8

• (b) if authorised by a special resolution passed at a separate meeting of the holders of the Shares of the class; and

any variation of the rights shall be subject to Part 2F.21 of Chapter 2F of the Corporations Act.

Part 2F.2, section 246B of the Corporations Act provides a mechanism for varying the rights of a class of securities on issue. It requires:

• (a) a special resolution of the Shareholders of the company approving the variation of the class rights; and

• (b) the written consent of the holder of the Performance Shares to the variation of the class rights.

The holders of the Performance Shares will be separately be asked to provide their written consent to the variation of the Performance Rights.

This Resolution 2, for the variation of the terms of the Performance Shares, is subject to and conditional upon the Company obtaining all necessary consents and approvals from the ASX. In the event that the Company does not obtain the necessary ASX consent and approval for this Resolution 2 by the date of the Meeting, the Company will withdraw the Resolution from the Meeting

2.2 Proposed variation

The terms and conditions of the Performance Shares as at the date of this Notice are specified in Annexure B. Pursuant to their terms, the Performance Shares had four separate performance Milestones which would result in the conversion of a specific number of Performance Shares into Shares. Milestone 1 was achieved on 14 September 2016 (see the Company’s announcement on 14 September 2016) and Milestones 2 and 3 were not completed within the required timeframe and lapsed. Accordingly, at the date of this Notice, the only remaining Milestone is specified at clause l(iv) of Schedule B ( Remaining Milestone ), being:

“31.5 million Performance Shares shall convert upon 1 million downloads of the Thred App being completed within a period of 360 days from the date of completion of the Capital Raising” .

The above milestone was originally designed to incentivise the founders and promoters of the Thred app to achieve what were, at the time, the envisaged goals of the Company. Since that time, however, and as indicated in the Company’s announcement of 13 December 2016, and in line with changes in the rapidly shifting digital landscape, the focus of Thred’s development and strategic direction has been on fast tracking Thred’s global rollout. Accordingly, as a result of this revised business strategy and consistent with feedback from advisors and ordinary shareholders that the founders and promoters of Thred have been adequately rewarded, and future incentives should be in the form of an Incentive Option Plan as set out in Resolution 1, the Board believes it is in the Company’s interest to propose making a variation to the terms of the Performance Shares by deleting the Remaining Milestone. As a result, there will be no remaining Milestones and all Performance Shares on issue will lapse.

Resolution 2 is a special resolution, meaning that at least 75% of all votes cast on the Resolution need to be cast in favour of the Resolution for it to be passed.

Resolution 3 – Ratification of Prior Issues of Securities

3.1 General

The Company issued the following Securities on the following dates:

• (a) on 28 February 2017 10,847,819 Shares were issued to the Underwriter (and/or its nominees) in consideration for underwriting services provided in respect of the Company’s recent Entitlement Offer ( Underwriter Shares ); and

• (b) on 28 February 2017 20,000,000 Options were issued to the Lead Manager as a fee for providing capital raising services to the Company under the Mandate ( Promoter Options );

Page | 9

Resolution 3 seeks Shareholder ratification pursuant to ASX Listing Rule 7.4 for the issue of those Securities outlined above ( Ratification ).

Listing Rule 7.1 provides that a company must not (subject to specified exceptions), without the approval of shareholders, issue or agree to issue during any 12 month period any equity securities, or other securities with rights to conversion to equity (such as an option), if the number of those securities exceeds 15% of the number of ordinary securities on issue at the commencement of that 12 month period.

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

Resolution 3 is an ordinary resolution.

3.2 Technical information required by ASX Listing Rule 7.4

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

• (a) the Securities issued were 10,847,819 Underwriter Shares and 20,000,000 Promoter Options;

• (b) the issue price of the Underwriter Shares was $0.02 per share, in consideration for underwriting services provided by the Underwriter to the Company in respect of the Entitlement Offer prospectus dated 6 December 2016;

• (c) the issue price of the Promoter Options was nil, in consideration for providing the Company with promotional services relating to the capital raising pursuant to the Entitlement Offer;

• (d) the Underwriter Shares issued were all fully paid ordinary shares in the capital of the Company issued on the same terms and conditions as the Company's existing Shares;

• (e) the Promoter Options issued are unlisted, each Promoter Option is exercisable into one Share at $0.05 per Promoter Option, an expiry date of three years from the date of issue and otherwise on the terms and conditions specified in Annexure A;

• (f) the Underwriter Shares were issued to the Underwriter (and/or its nominees) and clients of the Underwriter who are exempt investors under section 708 of the Corporations Act and none of whom are related parties of the Company; and

• (g) the Promoter Options were issued to the Lead Manager (and/or its nominees) and clients of the Lead Manager who are exempt investors under section 708 of the Corporations Act and none of whom are related parties of the Company; and

• (h) no cash consideration was raised by the Company from the issue of the Underwriter Shares or the Promoter Options.

Resolution 4 – Authority to Issue Placement Shares

4.1 General

Resolution 4 seeks Shareholder approval for the allotment and issue of up to 15,000,000 Shares at an issue price of $0.02 per Share to raise up to $300,000 ( Placement ).

Page | 10

Pursuant to the Mandate with the Lead Manager, the Company agreed that the Lead Manager has the right to manage the Placement for a period of 3 months from completion of the Entitlement Offer. The Company will pay the Lead Manager a fee of 6% (exclusive of goods and services tax) on the amount raised under the Placement.

A summary of ASX Listing Rule 7.1 is set out in Section 3.1 above.

The effect of Resolution 4 will be to allow the Company to issue the Shares pursuant to the Placement during the period of 3 months after the Meeting, without using the Company's 15% annual placement capacity.

4.2 Technical information required by ASX Listing Rule 7.1

Pursuant to and in accordance with ASX Listing Rule 7.3, the following information is provided in relation to the Placement:

• (a) the maximum number of Shares to be issued under the Placement is 15,000,000:

• (b) the Shares will be issued no later than 3 months after the date of the Meeting and it is intended that allotment will occur on the same date;

• (c) the issue price will be a minimum of $0.02 per Share;

• (d) the Shares will be issued to the clients of the Lead Manager who are exempt investors under section 708 of the Corporations Act. None of these subscribers are related parties of the Company;

• (e) the Shares issued will be fully paid ordinary shares in the capital of the Company issued on the same terms and conditions as the Company's existing Shares; and

• (f) the Company intends to use the funds raised from the Placement towards the development and marketing of the Company’s social messaging and e-commerce platform and general working capital.

Resolution 5 – Authority to Issue Shares to Company Secretary

5.1 General

Resolution 5 seeks Shareholder approval for the allotment and issue of 250,000 Shares, in consideration for out-of-scope services provided by Damon Sweeny ( Fee Shares ).

A summary of ASX Listing Rule 7.1 is set out in Section 3.1 above.

The effect of Resolution 5 will be to allow the Company to issue the Fee Shares during the period of 3 months after the Meeting, without using the Company's 15% annual placement capacity.

5.2 Technical information required by ASX listing Rule 7.1

Pursuant to and in accordance with ASX Listing Rule 7.3, the following information is provided in relation to the issue of the Fee Shares:

• (a) the maximum number of Shares to be issued is 250,000;

• (b) the Fee Shares will be issued no later than 3 months after the date of the Meeting and it is intended that allotment will occur on the same date;

Page | 11

• (c) the Shares will be issued for nil cash consideration in consideration for services provided by Mr Sweeny to the Company;

• (d) the Shares will be allotted and issued to Mr Sweeny (and/or his nominees), who is not a related party of the Company;

• (e) the Shares issued will be fully paid ordinary shares in the capital of the Company issued on the same terms and conditions as the Company's existing Shares; and

• (f) no funds will be raised from the issue of the Fee Shares, as they are being issued in consideration for services provided by Mr Sweeny to the Company.

Page | 12

Glossary

In this document the following definitions apply:

$	means Australian dollars.
AEDST	means Australian Eastern Daylight Savings Time.
ASX	means ASX Limited ACN 008 624 691 or, as the context requires, the
	Australian Securities Exchange operated by ASX Limited.
ASX Listing Rules	means the Listing Rules of ASX.
Board	means the current board of directors of the Company.
Business Day	means Monday to Friday inclusive, except New Year’s Day, Good Friday,
	Easter Monday, Christmas Day, Boxing Day, and any other day that ASX
	declares is not a business day.
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).
CompanyorThred	means Thred Limited ACN 124 541 466.
Constitution	means the Company’s constitution.
Corporations Act	means the_Corporations Act 2001_(Cth).
Directors	means the current directors of the Company.
Entitlement Offer	means the Company’s non-renounceable entitlement offer pursuant to the
	Company’s prospectus dated 6 December 2016.
Equity Securities	includes a Share, a right to a Share or Option, an Option, a convertible
	security and any security that ASX decides to classify as an Equity Security.
Explanatory Statement	means the explanatory statement accompanying this Notice.
Fee Shares	means the Shares which the Company proposes to issue as specified in
	Section 5.1.
General Meetingor	means the general meeting convened by this Notice.
Meeting

Page | 13

Key Management	has the same meaning as in the accounting standards issued by the
Personnel	Australian Accounting Standards Board and means those persons having
	authority and responsibility for planning, directing and controlling the
	Company’s activities, or if the Company is part of a consolidated entity, of the
	consolidated entity, directly or indirectly, including any director (whether
	executive or otherwise) of the Company, or if the Company is part of a
	consolidated entity, of an entity within the consolidated group.
Lead Manager	means Hunter Capital Advisors Pty Ltd (ACN 603 930 418)
Mandate	means the capital raising mandate between the Lead Manager and the
	Company as disclosed in section 5.1.1 of the Entitlement Offer prospectus.
Milestone	means a performance milestone for the Performance Shares.
NoticeorNotice of	means this notice of annual general meeting including the Explanatory
Meeting	Statement and the Proxy Form.
Option	means an option to subscribe for a Share.
Ordinary Securities	has the meaning set out in the ASX Listing Rules.
Placement	has the meaning specified in Section 4.1 of the Explanatory Memorandum
Plan	means the employee incentive scheme titled, Incentive Option Plan, which
	the Company is seeking to adopt pursuant to Resolution 1.
Promotor Options	means the Options previously issued by the Company as specified in Section
	3.1 on the terms outlined in Annexure A.
Proxy Form	means the proxy form accompanying this Notice.
Resolutions	means the resolutions to be considered by Shareholders at the Meeting, as
	set out in this Notice of Meeting.
Share	means a fully paid ordinary share in the capital of the Company.
Shareholder	means a registered holder of one or more Shares.
Underwriter	means Hunter Capital Advisors Pty Ltd (ACN 603 930 418)
Underwriter Shares	means the Shares previously issued by the Company as specified in Section
	3.1.

Page | 14

Annexure A –Terms of Promoter Options

(a) Entitlement

Subject to paragraph (m), each Option entitles the holder to subscribe for one Share upon exercise of the Option.

(b) Exercise Price and Expiry Date

Subject to paragraphs (j) and (l), the amount payable upon exercise of each Option will be $0.05 ( Exercise Price ).

(c)

Expiry Date

Each Option will expire at 5:00pm (WST) on the date which is three (3) years from the date of their issue ( Expiry Date ). An Option not exercised before the Expiry Date will automatically lapse on the Expiry Date.

(d) Exercise Period

The Options are exercisable at any time on or prior to the Expiry Date ( Exercise Period ).

(e) Notice of Exercise

The Options may be exercised during the Exercise Period by notice in writing to the Company in the manner specified on the Option certificate ( Notice of Exercise ) and payment of the Exercise Price for each Option being exercised in Australian currency by electronic funds transfer or other means of payment acceptable to the Company.

(f)

Exercise Date

A Notice of Exercise is only effective on and from the later of the date of receipt of the Notice of Exercise and the date of receipt of the payment of the Exercise Price for each Option being exercised in cleared funds ( Exercise Date ).

(g) Timing of issue of Shares on exercise

Within 15 Business Days after the later of the following:

• (i) the Exercise Date; and

• (ii) when excluded information in respect to the Company (as defined in section 708A(7) of the Corporations Act) (if any) ceases to be excluded information,

but in any case no later than 20 Business Days after the Exercise Date, the Company will:

• (iii) allot and issue the number of Shares required under these terms and conditions in respect of the number of Options specified in the Notice of Exercise and for which cleared funds have been received by the Company;

• (iv) if required, give ASX a notice that complies with section 708A(5)(e) of the Corporations Act, or, if the Company is unable to issue such a notice, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors; and

• (v) if admitted to the official list of ASX at the time, apply for official quotation on ASX of Shares issued pursuant to the exercise of the Options.

Page | 15

If a notice delivered under (g)(iv) for any reason is not effective to ensure that an offer for sale of the Shares does not require disclosure to investors, the Company must no later than 20 Business Days after becoming aware of such notice being ineffective, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors.

(h)

Shares issued on exercise

Shares issued on exercise of the Options rank equally with the then issued shares of the Company.

(i) Quotation of Shares issued on exercise

If admitted to the official list of ASX at the time, application will be made by the Company to ASX for quotation of the Shares issued upon the exercise of the Options.

(j)

Reconstruction of capital

If at any time the issued capital of the Company is reconstructed, all rights of an Optionholder are to be changed in a manner consistent with the Corporations Act and the ASX Listing Rules at the time of the reconstruction.

(k) Participation in new issues

There are no participation rights or entitlements inherent in the Options and holders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the Options without exercising the Options.

(l)

Adjustment for rights issue

In the event the Company proceeds with a pro rata issue (except a bonus issue) of securities to Shareholders after the date of issue of the Options, the Exercise Price will be reduced in accordance with the formula set out in ASX Listing Rule 6.22.2.

(m) Adjustment for bonus issues of Shares

If the Company makes a bonus issue of Shares or other securities to existing Shareholders (other than an issue in lieu or in satisfaction of dividends or by way of dividend reinvestment):

• (i) the number of Shares which must be issued on the exercise of an Option will be increased by the number of Shares which the Optionholder would have received if the Optionholder had exercised the Option before the record date for the bonus issue; and

• (ii) no change will be made to the Exercise Price.

(n) Unquoted

The Company will not apply for quotation of the Options on ASX.

(o)

Transferability

The Options are transferable subject to any restriction or escrow arrangements imposed by ASX or under applicable Australian securities laws.

Page | 16

Annexure B – Terms of Performance Shares

• (a) Performance Shares: Each Performance Share is a share in the capital of the Company.

• (b) General meetings: The Performance Shares shall confer on the holder ( Holder ) the right to receive notices of general meetings and financial reports and accounts of the Company that are circulated to Shareholders. Holders have the right to attend general meetings of the Company.

• (c) No voting rights: The Performance Shares do not entitle the Holder to vote on any resolutions proposed at a general meeting of the Company, subject to any voting rights under the Corporations Act or the Listing Rules where such rights cannot be excluded by these terms.

• (d) No dividend rights: The Performance Shares do not entitle the Holder to any dividends.

• (e) No rights on winding up: Upon winding up of the Company, the Performance Shares may not participate in the surplus profits or assets of the Company.

• (f) Transfer of Performance Shares: A Performance Share is not transferable.

• (g) Reorganisation of capital: If the Company's issued capital is reconstructed, all rights of a Holder will be changed to the extent necessary to comply with the Listing Rules at the time of reorganisation provided that, subject to compliance with the Listing Rules, following such reorganisation the economic and other rights of the Holder are not diminished or terminated.

• (h) Application to ASX: The Performance Shares will not be quoted on ASX. Upon conversion of the Performance Shares into Shares in accordance with these terms, the Company must within seven (7) days after the conversion, apply for and use its best endeavours to obtain the official quotation on ASX of the Shares arising from the conversion.

• (i) Participation in entitlements and bonus issues: Subject always to the rights under item (g) above, Holders will not be entitled to participate in new issues of capital offered to Shareholders such as bonus issues and entitlement issues.

• (j) Amendments required by ASX: The terms of the Performance Shares may be amended as necessary by the Board in order to comply with the Listing Rules, or any directions of ASX regarding the terms provided that, subject to compliance with the Listing Rules, following such amendment, the economic and other rights of the Holder are not diminished or terminate.

• (k) No other rights: The Performance Shares give the Holders no rights other than those expressly provided by these terms and those provided at law where such rights at law cannot be excluded by these terms.

• (l) Milestones: The Performance Shares will convert upon satisfaction of the following milestones:

• (i) 31.5 million Performance Shares shall convert upon the launch of the Thred App (with defined functionality including message centre, Thred creation, link and image sharing, social profile collaboration and micro-Threds) within a period of 90 days from the date of completion of the Capital Raising ( Milestone 1 );

• (ii) 42 million Performance Shares shall convert upon 250,000 downloads of the Thred App being completed within a period of 90 days from satisfaction of Milestone 1;

• (iii) 42 million Performance Shares shall convert upon the Company updating the Thred App to incorporate an artificial intelligence ( Al ) engine within a period 180 days from completion

Page | 17

of the Capital Raising (with the Al engine having minimum functionality consistent with the following):

• (A) the Al engine learns the preferences of users and their message partners;

• (B) the Al engine then predictively suggests matches when users are creating new Threds;

• (C) suggested matches will include potential recipients who, through their own choices, have been profiled as having similar interests as the Thred creator; and

• (D) the Al engine will suggest recipients only from the users' own connected social groups; and

• (iv) 31.5 million Performance Shares shall convert upon 1 million downloads of the Thred App being completed within a period of 360 days from the date of completion of the Capital Raising,

(each referred to as a Milestone ).

• (m) Conversion of Performance Shares: In the event a Milestone is satisfied, the Performance Shares held by the Holder will convert into an equal number of Shares.

• (n) No conversion if Milestone not achieved: Any Performance Share not converted into a Share within the earlier of:

• (i) the period referred to in respect of the relevant Milestone; or

• (ii) 2 years from the issue of the Performance Share,

will lapse.

(o) After conversion: The Shares issued on conversion of the Performance Shares will, as and from 5:00pm WST on the date of issue, rank equally with and confer rights identical with all other Shares then on issue and application will be made by the Company to ASX for official quotation of the Shares issued upon conversion.

• (p) Conversion procedure: The Company will issue the Holder with a new holding statement for the Shares as soon as practicable following the conversion of the Performance Shares into Shares.

• (q) Ranking of Shares: The Shares into which the Performance Shares will convert will rank pari passu in all respects with the Shares on issue at the date of conversion.

Page | 18

Annexure C – Terms of Plan

Subject to Shareholder approval at the Meeting, the Company will adopt an Incentive Option Plan ( Plan ) as a means of rewarding its employees and consultants. The Board will make offers to persons to participate in the Plan based on their contribution to the Company. The Options will not be listed.

The key terms of the Plan are as follows:

Term	Meaning
Eligibility	Participants must be a permanent full-time, part-time employee, a Director (whether executive or non-executive) or a selected casual employee (Participant).
Administration	The Plan will be administered by the Board, who has absolute and unfettered discretion to act (or refrain from acting) in connection with the Plan, including the delegation of any of its powers.
Offer	The Board may, in its absolute discretion, make a written offer (pursuant to an Offer Document) to any Participant to apply for Options, upon the terms set out in the Plan and upon such terms and conditions as the Board determines.
Acceptance	A Participant may accept an Offer in whole or in part, by signing and returning an Acceptance Form to the Company. The Board may accept or reject any Acceptance Form in its absolute discretion.
Option	Each Option will be issued for no more than nominal consideration and entitles the Participant to subscribe for one Share in the Company (subject to adjustments for reconstructions of the capital of the Company) at an exercise price to be determined by the Board.
Grant	The Board has the discretion to set the terms and condition so which it will offer and grant Options under the Plan, including the vesting conditions and any waiver of the terms and conditions. The vesting conditions will be specified in the Offer Document to the relevant Participant.
Exercise	Options that have vested are generally able to be exercised prior to their expiry date (Exercise Period). On exercise the Participant must pay the relevant exercise price for those Options.
Shares	Shares issued on exercise of Options issued under the Plan will rank equally with the other issued Shares. Depending on the terms of issue, the Shares may be subject to disposal restrictions, which means that they may not be disposed or dealt with for a period of time, or may not be issued until the expiration of such restriction period. Shares allocated on vesting or exercise of an Option carry the same rights and entitlements as other issued Shares, including dividend and voting rights.
Quotation	Options will not be quoted on the ASX. If other shares are officially quoted on the ASX at the time of issue of Shares under the Plan, the Company will apply for Official Quotation of any Shares issued under the Plan, in accordance with the ASX Listing Rules.
Cessation of Eligibility	If a Participant ceases to be eligible as a Participant under the Plan, any unvested Options will not vest. However, the Board may elect to waive any vesting conditions on the vesting of any Options if a Participant has died, suffered total and permanent disablement or been made redundant.

Page | 19

Change of control	On a change of control event, all option vesting Conditions are deemed to be automatically waived, immediately vesting unvested Options in the Participant. In respect of vested, exercised Options, a Participant may be provided with shares of the company acquiring control of the Company, in lieu of Shares of the Company, on substantially the same terms with appropriate adjustments.
Restrictions	Without the prior approval of the Board, or unless required by law, Options may not be sold, transferred, encumbered or otherwise dealt with.
Amendments	To the extent permitted by the ASX Listing Rules, the Board retains the discretion to vary the terms and conditions of the Plan. No adjustment or variation of the terms of an Option will be made without the consent of the relevant Participant, unless such amendment is required by law, to correct any manifest error or mistake, or for certain tax reasons.
Other terms	The Plan also contains customary and usual terms having regard to Australian law for dealing with administration, variation, suspension and termination of the Plan.

Page | 20

YOUR VOTE IS IMPORTANT. FOR YOUR VOTE TO BE EFFECTIVE IT MUST BE RECORDED BEFORE 10:00am (WST), 8 APRIL 2017

TO VOTE BY COMPLETING THE PROXY FORM

STEP 1 Appointment of Proxy

Indicate here who you want to appoint as your Proxy

If you wish to appoint the Chairman of the Meeting as your proxy, mark the box. If you wish to appoint someone other than the Chairman of the Meeting as your proxy please write the full name of that individual or body corporate. If you leave this section blank, or your named proxy does not attend the meeting, the Chairman of the Meeting will be your proxy. A proxy need not be a security holder of the company. Do not write the name of the issuer company or the registered securityholder in the space.

Proxy which is a Body Corporate

Where a body corporate is appointed as your proxy, the representative of that body corporate attending the meeting must have provided an ‘Appointment of Corporate Representative’ prior to admission. An Appointment of Corporate Representative form can be obtained from the company’s securities registry.

Appointment of a Second Proxy

You are entitled to appoint up to two proxies to attend the meeting and vote on a poll. If you wish to appoint a second proxy, an additional Proxy Form may be obtained by telephoning the company’s securities registry or you may copy this form.

To appoint a second proxy you must:

(a) complete two Proxy Forms. On each Proxy Form state the percentage of your voting rights or the number of securities applicable to that form. If the appointments do not specify the percentage or number of votes that each proxy may exercise, each proxy may exercise half your votes. Fractions of votes will be disregarded.

(b) return both forms together in the same envelope.

STEP 2 Voting Directions to your Proxy

You can tell your Proxy how to vote.

To direct your proxy how to vote, place a mark in one of the boxes opposite each item of business. All your securities will be voted in accordance with such a direction unless you indicate only a portion of voting rights are to be voted on any item by inserting the percentage or number of securities you wish to vote in the appropriate box or boxes. If you do not mark any of the boxes on a given item, your proxy may vote as he or she chooses. If you mark more than one box on an item your vote on that item will be invalid.

STEP 3 Sign the Form

The form must be signed as follows:

Individual : This form is to be signed by the securityholder.

Joint Holding : where the holding is in more than one name, all the securityholders must sign.

Power of Attorney : to sign under a Power of Attorney, you must have already lodged it with the registry. Alternatively, attach a certified photocopy of the Power of Attorney to this form when you return it.

Companies : this form must be signed by a Director jointly with either another Director or a Company Secretary. Where the company has a Sole Director who is also the Sole Company Secretary, this form must be signed by that person. Please indicate the office held by signing in the appropriate place .

STEP 4 Lodgement of a Proxy

This Proxy Form (and any Power of Attorney under which it is signed) must be received at an address given below not later than 48 hours before the commencement of the meeting ( 10:00 am (WST) on 8 APRIL 2017 ). Any Proxy Form received after that time will not be valid for the scheduled meeting.

Proxies may be lodged:

BY MAIL - PO Box 994, Subiaco, WA 6909 BY FAX - +61 8 9389 5885 IN PERSON - 8/55 Hampden Rd, Nedlands, WA 6009.

Attending the Meeting

If you wish to attend the meeting please bring this form with you to assist registration.

FOR ALL ENQUIRIES CALL: +61 8 9389 5885 ALL CORRESPONDENCE TO: Company Secretary

ACN 124 541 466

==> picture [107 x 52] intentionally omitted <==

General Meeting Proxy form

Your Address

This is your address as it appears on the company’s share register. If this is incorrect, please mark the box with an ‘X’ and make the correction on the form. Securityholders sponsored by a broker should advise your broker of any changes. Please note, you cannot change ownership of your securities using this form.

STEP 1 - Appointment of Proxy

I/We being a member/s of Thred Limited and entitled to attend and vote hereby appoint

the Chairman of the Meeting

OR

(mark with an ‘X’)

==> picture [116 x 40] intentionally omitted <==

If you are not appointing the Chairman of the Meeting as your proxy please write here the full name of the individual or body corporate (excluding the registered Securityholder) you are appointing as your proxy.

or failing the individual or body corporate named, or if no individual or body corporate is named, the Chairman of the Meeting, as my/our proxy at the General Meeting of Thred Limited to be held at Subiaco Business Centre, Suite 5, 531 Hay Street, Subiaco, Perth, Western Australia on 10 April 2017 at 10:00 am ( WST ) and at any adjournment of that meeting, to act on my/our behalf and to vote in accordance with the following directions or if no directions have been given, as the proxy sees fit.

The Chairman will vote all undirected proxies in favour of all Resolutions.

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 ____%

STEP 2 - Voting directions to your Proxy – please mark  to indicate your directions

Ordinary Business For Against Abstain Resolution 1 Adoption of Incentive Option Plan    Resolution 2 Variation of terms of Performance Shares    Resolution 3 (a) Ratification of Prior Issues of Securities - 10,847,819 Underwriter Shares    Resolution 3 (b) Ratification of Prior Issues of Securities - 20,000,000 Promoter Options    Resolution 4 Authority to issue Placement Shares    Resolution 5 Authority to issue Shares to Company Secretary   

STEP 3 - Please sign here

This section must be signed in accordance with the instructions overleaf to enable your directions to be implemented.

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