WEST COBAR METALS LIMITED — Proxy Solicitation & Information Statement 2022

Sep 20, 2022

WEST COBAR METALS LIMITED

ACN 649 994 669

NOTICE OF GENERAL MEETING

A general meeting of the Company will be held at Level 8, London House, 216 St Georges Terrace, Perth WA 6000 on Monday, 24 October 2022 at 1:00pm (AWST).

West Cobar Metals Limited ( Company ) encourages all Shareholders who cannot attend the meeting in person to vote by directed proxy. Proxy forms for the general meeting ( Meeting ) should be lodged before 1:00pm (AWST) on Saturday, 22 October 2022. Shareholders can also submit, and are encouraged to submit, any questions in advance of the Meeting by emailing the questions to info@westcobarmetals.com.au by no later than 1:00pm (AWST) on Saturday, 22 October 2022.

If the above arrangements with respect to the Meeting change, Shareholders will be updated via the ASX Market Announcements Platform. This Notice 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 do not hesitate to contact the Company Secretary by telephone on +61 08 9481 0389

WEST COBAR METALS LIMITED ACN 649 994 669

NOTICE OF GENERAL MEETING

Notice is hereby given that a general meeting of shareholders of West Cobar Metals Limited ( Company ) will be held at Level 8, London House, 216 St Georges Terrace, Perth WA 6000 on Monday, 24 October 2022 at 1:00pm (AWST) ( Meeting ).

The Explanatory Memorandum provides additional information on matters to be considered at the Meeting. The Explanatory Memorandum and the Proxy Form form 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 Meeting are those who are registered as Shareholders on Saturday, 22 October 2022 at 5:00pm (AWST).

The Company advises that a poll will be conducted for all Resolutions.

Terms and abbreviations used in this Notice (including the Explanatory Memorandum) are defined in Schedule 1.

AGENDA

1 Resolution 1 – Approval to issue Consideration Shares

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

" That, pursuant to and in accordance with Listing Rule 7.1 and for all other purposes, Shareholders approve the issue of up to 39,000,000 Consideration Shares pursuant to the Acquisition on the terms and conditions in the Explanatory Memorandum ."

Voting Exclusion

The Company will disregard any votes cast in favour of the Resolution by or on behalf of any person that may receive the Consideration Shares or any other person who will obtain a material benefit as a result of the issue of securities (except a benefit solely by reason of being a holder of ordinary securities) or an associate of those persons.

However, this does not apply to a vote cast in favour of the Resolution by:

• (a) a person as proxy or attorney for a person who is entitled to vote on the Resolution, in accordance with directions given to the proxy or attorney to vote on the Resolution in that way; or

• (b) the Chairperson of the Meeting as proxy or attorney for a person who is entitled to vote on the Resolution, in accordance with a direction given to the Chairperson to vote on the Resolution as the Chairperson decides; or

• (c) a holder acting solely in a nominee, trustee, custodial or other fiduciary capacity on behalf of a beneficiary provided the following conditions are met:

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• (i) the beneficiary provides written confirmation to the holder that the beneficiary is not excluded from voting and is not an associate of a person excluded from voting, on the Resolution; and

• (ii) the holder votes on the Resolution in accordance with directions given by the beneficiary to the holder to vote in that way.

2 Resolution 2 – Approval to issue Options to Mr Rob Klug

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

"That, pursuant to and in accordance with Listing Rule 10.11 and for all other purposes, approval is given for the Company to issue 1,000,000 Options to Mr Rob Klug (and/or his nominee(s)) on the terms and conditions in the Explanatory Memorandum.”

Voting Exclusion

The Company will disregard any votes cast in favour of this Resolution by or on behalf of Mr Rob Klug (and/or his nominees(s)) and any other person who will obtain a material benefit as a result of the issue of the securities (except a benefit solely by reason of being a holder of ordinary securities in the entity) or an associate of that person or those persons.

However, this does not apply to a vote cast in favour of a resolution by:

• (a) a person as proxy or attorney for a person who is entitled to vote on the resolution, in accordance with directions given to the proxy or attorney to vote on the resolution in that way; or

• (b) the Chairperson as proxy or attorney for a person who is entitled to vote on the resolution, in accordance with a direction given to the Chairperson to vote on the resolution as the Chairperson decides; or

• (c) a holder acting solely in a nominee, trustee, custodial or other fiduciary capacity on behalf of a beneficiary provided the following conditions are met:

• (i) the beneficiary provides written confirmation to the holder that the beneficiary is not excluded from voting, and is not an associate of a person excluded from voting, on the resolution; and

• (ii) the holder votes on the resolution in accordance with directions given by the beneficiary to the holder to vote in that way.

In accordance with section 250BD of the Corporations Act, a vote on this Resolution must not be cast by a person appointed as a proxy, where that person is either a member of the Key Management Personnel or a Closely Related Party of such member.

However, a vote may be cast by such person if the vote is not cast on behalf of a person who is otherwise excluded from voting, and:

• (a) the person is appointed as a proxy and the appointment specifies how the proxy is to vote; or

• (b) the person appointed as proxy is the Chairperson and the appointment does not specify how the Chairperson is to vote but expressly authorises the Chairperson to exercise the proxy even if the Resolution is connected with the remuneration of a member of the Key Management Personnel.

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3 Resolution 3 – Approval to issue Options to Mr Matt Szwedzicki

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

"That, pursuant to and in accordance with Listing Rule 10.11 and for all other purposes, approval is given for the Company to issue 1,000,000 Options to Mr Matt Szwedzicki (and/or his nominee(s)) on the terms and conditions in the Explanatory Memorandum.”

Voting Exclusion

The Company will disregard any votes cast in favour of this Resolution by or on behalf of Mr Matt Szwedzicki (and/or his nominees(s)) and any other person who will obtain a material benefit as a result of the issue of the securities (except a benefit solely by reason of being a holder of ordinary securities in the entity) or an associate of that person or those persons.

However, this does not apply to a vote cast in favour of a resolution by:

• (a) a person as proxy or attorney for a person who is entitled to vote on the resolution, in accordance with directions given to the proxy or attorney to vote on the resolution in that way; or

• (b) the Chairperson as proxy or attorney for a person who is entitled to vote on the resolution, in accordance with a direction given to the Chairperson to vote on the resolution as the Chairperson decides; or

• (c) a holder acting solely in a nominee, trustee, custodial or other fiduciary capacity on behalf of a beneficiary provided the following conditions are met:

• (i) the beneficiary provides written confirmation to the holder that the beneficiary is not excluded from voting, and is not an associate of a person excluded from voting, on the resolution; and

• (ii) the holder votes on the resolution in accordance with directions given by the beneficiary to the holder to vote in that way.

In accordance with section 250BD of the Corporations Act, a vote on this Resolution must not be cast by a person appointed as a proxy, where that person is either a member of the Key Management Personnel or a Closely Related Party of such member.

However, a vote may be cast by such person if the vote is not cast on behalf of a person who is otherwise excluded from voting, and:

• (d) the person is appointed as a proxy and the appointment specifies how the proxy is to vote; or

• (e) the person appointed as proxy is the Chairperson and the appointment does not specify how the Chairperson is to vote but expressly authorises the Chairperson to exercise the proxy even if the Resolution is connected with the remuneration of a member of the Key Management Personnel.

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4 Resolution 4 – Approval to issue Options to Mr Craig McNab

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

That, pursuant to and in accordance with Listing Rule 7.1 and for all other purposes, Shareholders approve the issue of 400,000 Options to Mr Craig McNab (and/or his nominee(s)) on the terms and conditions in the Explanatory Memorandum ."

Voting Exclusion

The Company will disregard any votes cast in favour of the Resolution by or on behalf of Mr Craig McNab (and/or his nominee(s)) and any other person who will obtain a material benefit as a result of the issue of securities (except a benefit solely by reason of being a holder of ordinary securities) or an associate of those persons.

However, this does not apply to a vote cast in favour of the Resolution by:

• (a) a person as proxy or attorney for a person who is entitled to vote on the Resolution, in accordance with directions given to the proxy or attorney to vote on the Resolution in that way; or

• (b) the Chairperson of the Meeting as proxy or attorney for a person who is entitled to vote on the Resolution, in accordance with a direction given to the Chairperson to vote on the Resolution as the Chairperson decides; or

• (c) a holder acting solely in a nominee, trustee, custodial or other fiduciary capacity on behalf of a beneficiary provided the following conditions are met:

• (i) the beneficiary provides written confirmation to the holder that the beneficiary is not excluded from voting and is not an associate of a person excluded from voting, on the Resolution; and

• (ii) the holder votes on the Resolution in accordance with directions given by the beneficiary to the holder to vote in that way.

Dated: 21 September 2022

By order of the Board

Craig McNab

Company Secretary

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WEST COBAR METALS LIMITED ACN 649 994 669

EXPLANATORY MEMORANDUM

1 Introduction

This Explanatory Memorandum has been prepared for the information of Shareholders in connection with the business to be conducted at the Meeting.

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

This Explanatory Memorandum includes the following information to assist Shareholders in deciding how to vote on the Resolutions:

Section 2 Action to be taken by Shareholders Section 3 Background to the Acquisition Section 4 Resolution 1 – Approval to issue Consideration Shares Section 5 Resolutions 2 and 3 – Approval to issue Options to Messrs Klug and Szwedzicki Section 6 Resolution 4 – Approval to issue Options to Mr Craig McNab Schedule 1 Definitions Schedule 2 Summary of Share Sale Agreements Schedule 3 Terms and Conditions of Options

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

2 Action to be taken by Shareholders

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

The Company advises that a poll will be conducted for all Resolutions.

2.1 Proxies

A Proxy Form is attached to the Notice. This is to be used by Shareholders if they wish to appoint a representative (a 'proxy') to vote in their place. All Shareholders are invited and encouraged to attend the Meeting or, if they are unable to attend in person, sign and return

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the Proxy Form to the Company in accordance with the instructions thereon. Returning the Proxy Form will not preclude a Shareholder from attending and voting at the Meeting in person.

Please note that:

• (a) a member of the Company entitled to attend and vote at the Meeting is entitled to appoint a proxy;

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

• (c) a member of the Company 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. Where the proportion or number is not specified, each proxy may exercise half of the votes.

Proxy Forms must be received by the Company no later than 1:00pm (AWST) on Saturday, 22 October 2022, being at least 48 hours before the Meeting.

The Proxy Form provides further details on appointing proxies and lodging Proxy Forms.

2.2

Attendance at Meeting

The Company encourages all Shareholders who cannot attend the Meeting in person to vote by directed proxy.

If it becomes necessary or appropriate to make alternative arrangements to those detailed in this Notice, Shareholders will be updated via the ASX announcements platform and on the Company’s website at https://www.westcobarmetals.com.au/announcements/.

3 Background to the Acquisition

Acquisition of Salazar

• 3.1 On 8 September 2022, the Company announced that it had entered into Share Sale Agreements to acquire the entire issued capital of Salazar Minerals Pty Ltd ( Salazar Minerals ) (and indirectly its subsidiary Salazar Gold Pty Ltd ( Salazar Gold )) from the shareholders of Salazar Minerals ( Vendors ) ( Acquisition ). As consideration for the Acquisition, the Company has agreed to issue up to 39,000,000 fully paid ordinary shares in the Company at a deemed issue price of A$0.10 to the Vendors ( Consideration Shares ). The exact number of Consideration Shares may be slightly less due to rounding.

• 3.2 Refer to Schedule 2 for a summary of the Share Sale Agreements.

• 3.3 Completion of the Acquisition is conditional upon the satisfaction of various conditions precedent, including but not limited to, Shareholder approval for the issue of the Consideration Shares (Resolution 1).

• 3.4 For further information on the Acquisition, refer to the Company's ASX announcement dated 8 September 2022.

Background to Salazar and the Acquisition

• 3.5 Salazar is an Australian proprietary company incorporated on 30 August 2011 and is an exploration company focused on the exploration and development of its Salazar Rare Earth Element Clay Project located near Esperance in Western Australia ( Salazar Project ).

• 3.6 Salazar Gold is the holder of two explorations licences (E 63/1469-I and E 63/1496) located in Western Australia ( Salazar Tenements ) which comprises the Salazar Project.

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• 3.7 The Board considers the Acquisition to be an attractive and complementary business to the Company's current operations for the following reasons:

• (a) an initial due diligence assessment by the Company's directors, one of whom has had experience in rare earths exploration, provided an encouraging assessment of the Salazar Projects' rare earths potential and would add significant value to Shareholders;

• (b) historical exploration of the same region as the Salazar Tenements suggests strong prospectivity for rare earths and other commodities;

• (c) the Salazar Tenements are located in a highly active area of exploration for a number of commodities including iron ore, gold, nickel and copper; and

• (d) acquiring the Salazar Tenements will provide the Company with a more diverse range of assets, which the Company expect to greatly enhance investor appeal.

Effect on Capital Structure

• 3.8 The indicative effect of the Acquisition on the capital structure of the Company (including the dilution to existing Shareholders) will be as follows:

	Shares	Dilution to existing **Shareholders1 **	Options
Current issued capital	41,500,000	-	16,000,000
Maximum number of Consideration Shares to be issued pursuant to the Acquisition	39,000,000	48.44%	-
Options to be issued to Directors and the Company Secretary2			2,400,000
Total on completion of the Acquisition	80,500,000	48.44%	18,400,000

Notes:

1. Assuming that:

2. a. no other options, performance rights or other convertible securities are exercised or converted; and

3. b. no further Shares are issued by the Company.

4. Refer to Resolutions 2 to 4 for further details.

4 Resolution 1 - Approval to issue Consideration Shares

4.1 General

Resolution 1 seeks Shareholder approval pursuant to Listing Rule 7.1 for the issue of the Consideration Shares pursuant to the Acquisition to the Vendors. Refer to Section 3 for further details on the Acquisition.

Resolution 1 is an ordinary resolution.

The Chairperson intends to exercise all available proxies in favour of Resolution 1.

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4.2 Listing Rule 7.1

Broadly speaking, and subject to a number of exceptions, Listing Rule 7.1 limits the amount of Equity Securities that a listed company can issue without the approval of its shareholders over any 12 month period to 15% of the fully paid ordinary securities it had on issue at the start of that period.

The issue of the Consideration Shares does not fall within any of these exceptions and will result in the Company exceeding the 15% limit in Listing Rule 7.1. It therefore requires the approval of the Company's Shareholders under Listing Rule 7.1.

If Resolution 1 is passed, the issue of Consideration Shares will be issued to the Vendors without using up any of the Company's 15% limit on issuing equity securities without Shareholder approval under Listing Rule 7.1.

If Resolution 1 is not passed, the Consideration Shares will not be issued to the Vendors (and, accordingly the Acquisition will not proceed) as the issue of such securities and the Acquisition are conditional on Shareholder approval.

4.3

Information required by Listing Rule 7.3

In accordance with Listing Rule 7.3, the following information is provided in relation to the Consideration Shares:

• (a) the Consideration Shares will be issued to the Vendors. None of the Vendors are related parties, key management personnel, a substantial shareholder or an advisor of the Company or an associate of one of these;

• (b) a maximum of 39,000,000 Consideration Shares will be issued pursuant to the Acquisition;

• (c) the Consideration Shares will be fully paid ordinary shares and will rank equally with the Company’s existing Shares on issue;

• (d) the Consideration Shares will be issued no later than three months after the date of the Meeting;

• (e) the Consideration Shares will be issued at a deemed issue price of A$0.10 per Share;

• (f) the Consideration Shares will be issued as consideration for the Acquisition;

• (g) a summary of the material terms of the Share Sale Agreements is detailed in Schedule 2; and

• (h) a voting exclusion statement is included in the Notice for Resolution 1.

4.4 Director Recommendation

The Directors recommend that Shareholders vote in favour of Resolution 1.

5 Resolutions 2 and 3 – Approval to issue Options to Messrs Klug and Szwedzicki

5.1 General

On 8 September 2022, the Company announced that, in connection with the Acquisition, the Company had agreed, subject to obtaining Shareholder approval, to issue:

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• (a) 1,000,000 Options each with an exercise price equal to a 45% premium to the VWAP for the 5 Trading Days prior to the date of the Meeting and expiring 2.5 years from the date of issue to Mr Robert Klug (and/or his nominee(s)); and

• (b) 1,000,000 Options each with an exercise price equal to a 45% premium to the VWAP for the 5 Trading Days prior to the date of the Meeting and expiring 2.5 years from the date of issue to Mr Matt Szwedzicki (and/or his nominee(s)),

(together the Director Options ).

In accordance with Listing Rule 10.11, Shareholder approval is required for the issue of Options to a related party. Messrs Klug and Szwedzicki are related parties of the Company by reason of being a Director of the Company.

Resolutions 2 and 3 are ordinary resolutions.

The Chairperson intends to exercise all available proxies in favour of Resolutions 2 and 3.

5.2 Section 208 of Corporations Act

In accordance with section 208 of the Corporations Act, to give a financial benefit to a related party, the Company must obtain Shareholder approval unless the giving of the financial benefit falls within an exception in sections 210 to 216 of the Corporations Act.

Messrs Klug and Szwedzicki who are Directors are each a related party of the Company.

The Board has formed the view that Shareholder approval under section 208 of the Corporations Act is not required for the proposed issue of the Director Options as the exception in section 211 of the Corporations Act applies. The Director Options are considered to be reasonable remuneration for the purposes of section 211 of the Corporations Act.

5.3 Listing Rule 10.11

Listing Rule 10.11 provides that unless one of the exceptions in Listing Rule 10.12 applies, a listed company must not issue or agree to issue equity securities to:

10.11.1	a related party;
10.11.2	a person who is, or was at any time in the 6 months before the issue
	or agreement, a substantial (30%+) holder in the company;
10.11.3	a person who is, or was at any time in the 6 months before the issue
	or agreement, a substantial (10%+) holder in the company and who
	has nominated a director to the board of the company pursuant to a
	relevant agreement which gives them a right or expectation to do so;
10.11.4	an associate of a person referred to in Listing Rules 10.11.1 to
	10.11.3; or
10.11.5	a person whose relationship with the company or a person referred to
	in Listing Rules 10.11.1 to 10.11.4 is such that, in ASX’s opinion, the
	issue or agreement should be approved by its shareholders,

unless it obtains shareholder approval.

The issue of the Director Options falls within Listing Rule 10.11.1, as Messrs Klug and Szwedzicki are related parties to the Company, and do not fall within any of the exceptions in Listing Rule 10.12. It therefore requires the approval of the Company’s Shareholders under Listing Rule 10.11.

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Resolutions 2 and 3 seek the required shareholder approval to issue the Director Options under and for the purposes of Listing Rule 10.11.

If Resolutions 2 and 3 are passed, the Company will be able to proceed with the issue of the Director and pursuant to Listing Rule 7.2, exception 14, the Company may issue the Director Options without using up the Company's 15% placement capacity under Listing Rule 7.1.

If Resolutions 2 and 3 are not passed, the Company will not be able to proceed with the issue of the Director Options and Messrs Klug and Szwedzicki will not receive the Director Options.

5.4 Specific information required by Listing Rule 10.13

Listing Rule 10.13 requires that the following information be provided to Shareholders:

• (a) the Director Options will be issued to Messrs Klug and Szwedzicki (and/or their nominee(s));

• (b) Messrs Klug and Szwedzicki fall within Listing Rule 10.11.1 as they are a related party of the Company by reason of being a director;

• (c) the maximum number of Options to be issued to:

• (i) Mr Rob Klug (and/or his nominee(s)) is 1,000,000 Options; and

• (ii) Mr Matt Szwedzicki (and/or his nominee(s)) is 1,000,000 Options,

each with an exercise price equal to a 45% premium to the VWAP for the 5 Trading Days prior to the date of the Meeting and expiring 2.5 years from the date of issue;

• (d) a summary of the material terms and conditions of the Director Options are detailed in Schedule 2;

• (e) the Shares issued on exercise of the Director Options will be fully paid ordinary shares and will rank equally with the Company’s existing Shares on issue;

• (f) the Company will issue the Director Options to Messrs Klug and Szwedzicki (and/or their nominee(s)) no later than one month after the date of the Meeting;

• (g) no funds will be raised by the issue of the Director Options as they are being issued for nil consideration;

• (h) the purpose of issuing the Director Options is to remunerate (in part) Messrs Klug and Szwedzicki for the provision of their services in connection with the Acquisition and to provide a cost effective way for the Company to remunerate Messrs Klug and Szwedzicki, which will allow the Company to spend a greater proportion of its cash reserves on its operations than it would if alternative cash forms of remuneration were given to Messrs Klug and Szwedzicki;

• (i) the current remuneration packages of Messrs Klug and Szwedzicki for being Directors of the Company are detailed below:

Name	Cash Salary and Fees (A$)	Superannuation (A$)	**Options1 **	Total (A$)
Rob Klug	50,000	5,250	-	55,250
Matt Szwedzicki	40,000	4,200	-	44,200

Notes:

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1. Excludes 1,000,000 Options to be issued to Mr Rob Klug (refer to Resolution 2) and 1,000,000 Options to be issued to Mr Matt Szwedzicki (refer to Resolution 3). The total value of the 2,000,000 Director Options is A$149,080. The Director Options were calculated using the Black-Scholes option pricing model with the following inputs:

Expected volatility (%) 80% Risk free interest rate (%) 0.1% Expiry date 2.5 years from date of issue Expected dividends Nil Option exercise price ($) $0.28 Share price at grant date ($) $0.195 Fair value of option ($) $0.075

• (j) as at the date of this Notice:

• (i) Mr Rob Klug holds the following interests in securities:

  • (A) 575,000 fully paid ordinary shares; and

  • (B) 2,000,000 unlisted options each with an exercise price of A$0.25 and expiring on 3 June 2026;

• (ii) Mr Matt Szwedzicki holds the following interests in securities:

  • (A) 1,025,000 fully paid ordinary shares; and

  • (B) 2,000,000 unlisted options each with an exercise price of A$0.25 and expiring on 3 June 2026; and

• (k) a voting exclusion statement is included in the Notice for Resolutions 2 and 3.

5.5 Directors recommendation

The Directors (other than Messrs Klug and Szwedzicki) recommend that Shareholders vote in favour of Resolutions 2 and 3.

6 Resolution 4 – Approval to issue Options to Mr Craig McNab

6.1 General

Resolution 4 seeks Shareholder approval pursuant to Listing Rule 7.1 for the issue of 400,000 Options each with an exercise price equal to a 45% premium to the VWAP for the 5 Trading Days prior to the date of the Meeting and expiring 2.5 years from the date of issue to Mr Craig McNab (and/or his nominee(s)).

Mr Craig McNab is not related party or associate of a related party of the Company.

Resolution 4 is an ordinary resolution.

The Chairperson intends to exercise all available proxies in favour of Resolution 4.

6.2 Listing Rule 7.1

A summary of Listing Rule 7.1 is described in Section 4.2.

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If Resolution 4 is passed, the Options will be issued to Mr Craig McNab and the Company may issue the Options without using up the Company's 15% placement capacity under Listing Rule 7.1.

If Resolution 4 is not passed, the Options will not be issued to Mr Craig McNab and Mr Craig McNab will not receive the Options.

6.3 Information required by Listing Rule 7.3

In accordance with Listing Rule 7.3, the following information is provided in relation to the Options:

• (a) the Options will be issued to Mr Craig McNab. Mr Craig McNab is the Company Secretary. Mr Craig McNab is not a related party, key management personnel, a substantial shareholder or an advisor of the Company or an associate of one of these;

• (b) the maximum number of Options to be issued to Mr Craig McNab (and/or his nominee(s)) is 400,000 Options each with an exercise price equal to a 45% premium to the VWAP for the 5 Trading Days prior to the date of the Meeting and expiring 2.5 years from the date of issue;

• (c) a summary of the material terms and conditions of the Options are detailed in Schedule 2;

• (d) the Shares issued on exercise of the Options will be fully paid ordinary shares and will rank equally with the Company’s existing Shares on issue;

• (e) the Options will be issued no later than three months after the date of the Meeting;

• (f) no funds will be raised by the issue of the Options as they are being issued for nil consideration;

• (g) the purpose of issuing the Options is to remunerate (in part) Mr Craig McNab for the provision of their services in connection with the Acquisition; and

• (h) A voting exclusion statement is included in the Notice for Resolution 4.

6.4 Director Recommendation

The Directors recommend that Shareholders vote in favour of Resolution 4.

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Schedule 1

Definitions

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

A$ or $ means Australian Dollars.

Acquisition has the meaning given in Section 3.1.

ASX means ASX Limited (ACN 008 624 691) and, where the context permits, the Australian Securities Exchange operated by ASX.

AWST means Australian Western Standard Time, being the time in Perth, Western Australia.

Board means the board of Directors.

Chairperson means the person appointed to chair the Meeting, or any part of the Meeting, convened by the Notice.

Closely Related Party means:

• (a) a spouse or child of the member; or

• (b) has the meaning given in section 9 of the Corporations Act.

Company or West Cobar means West Cobar Metals Limited (ACN 649 994 669).

Completion means completion of the sale and purchase of all of the issued share capital in Salazar Minerals pursuant to the Share Sale Agreements.

Consideration Shares has the meaning given in Section 3.1.

Corporations Act means the Corporations Act 2001 (Cth).

Director means a director of the Company.

Director Options has the meaning given in Section 5.1.

Explanatory Memorandum means the explanatory memorandum which forms part of the Notice.

Listing Rules means the listing rules of ASX.

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

Notice means the notice of meeting which comprises of the notice, agenda, Explanatory Memorandum and Proxy Form.

Option means an option which entitles the holder to subscribe for a Share.

Proxy Form means the proxy form attached to the Notice.

Resolution means a resolution contained in the Notice.

Salazar Gold means Salazar Gold Pty Ltd (ACN 140 211 221).

Salazar Group means Salazar and Salazar Gold.

Salazar Minerals means Salazar Minerals Pty Ltd (ACN 152 953 172).

Salazar Project has the meaning given in Section 3.5.

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Salazar Tenements has the meaning given in 3.6.

Schedule means a schedule to this Explanatory Memorandum.

Section means a section of this Explanatory Memorandum.

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

Shareholder means a shareholder of the Company.

Share Sale Agreements means the share sale agreements entered into between the Vendors and the Company as summarised in Schedule 2.

Trading Day means a day determined by ASX to be a trading day in accordance with the Listing Rules.

Vendors has the meaning given in Section 3.1.

VWAP means volume weighted average price.

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Schedule 2

Summary of the Share Sale Agreements

		Share Sale Agreements
1.	Consideration	The consideration payable is the Consideration Shares.
2.	Conditions Precedent	Completion is conditional upon: • (Shareholder approval) the Shareholders having approved, at a meeting of Shareholders, the issue of the Consideration Shares; • (Liabilities) all liabilities (actual or contingent) owing by the Salazar Group having been forgiven or capitalised and all receivables owing to the Salazar Group having been paid; • (Disposal) the Salazar Group disposing of E 31/910-I, E 312/942 and E 39/1978; • (Proceeding) the Salazar Group not being party to any legal proceedings; • (Regulatory consents and approvals) the Company and the Salazar Group, as applicable, having obtained all regulatory consents and approvals which are necessary for the acquisition of the Salazar Minerals' entire issued share capital; • (No material adverse change) no Material Adverse Change having occurred in respect of the Group or its assets prior to Completion.Material Adverse Changemeans any event, change, condition, matter, result or circumstance occurring on or after the date of the Share Sale Agreements but before Completion that (in the reasonable opinion of the Company) has, or is reasonably likely to have, individually or in aggregate, a material adverse effect on any of the Salazar Tenements, the Salazar Project, the Salazar Group or any of the Salazar Group's business, properties or assets; and • (Warranties) there having been no circumstances arising prior to Completion or at Completion which would constitute or give rise to a breach of any of the warranties in the Share Sale Agreements or any of the warranties given in connection with the acquisition of Salazar Minerals' entire issued share capital.
3.	Completion	Completion of the Acquisition will occur on the date which is five (5) business days after the satisfaction or waiver of the conditions precedent detailed in Item 2 above. The conditions precedent are for the benefit of the Company and the Company may at any time waive one or more of the conditions precedent.
4.	Warranties	Each party to the Share Sale Agreements provides warranties considered customary for an agreement of this nature.
5.	Escrow	The Consideration Shares will be subject to six months voluntary escrow from Completion.

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Schedule 3

Terms and Conditions of Options

(a) Entitlement

Each Option entitles the holder ( Holder ) to subscribe for one Share upon exercise.

(b) Exercise Price and Expiry Date

The amount payable upon exercise of each Option ( Exercise Price ) is a 45% premium to the VWAP for the 5 Trading Days prior to the date of the Meeting.

Each Option will expire at 5:00pm (WST) on the date which is 2.5 years from the date of issue ( Expiry Date ).

(c)

Exercise Period

Each Option is exercisable at any time prior to the Expiry Date ( Exercise Period ). After this time, any unexercised Options will automatically lapse.

(d) Notice of Exercise

The Options may be exercised by notice in writing to the Company ( Notice of Exercise ) and payment of the applicable Exercise Price for each Option being exercised.

(e)

Timing of issue of Shares on Exercise

Within five business days after receipt of a Notice of Exercise, the Company will:

• (i) 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;

• (ii) 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

• (iii) 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.

If a notice delivered under (e)(ii) 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.

(f)

Shares Issued on Exercise

Shares issued on exercise of the Options rank equally with the Shares on issue and will be free of all encumbrances, liens and third party interests.

(g)

Quotation of Shares

The Company will apply to ASX for official quotation of the Shares issued upon the exercise of the Options.

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(h) 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.

(i) 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 Holder would have received if the Holder of an Option had exercised the Option before the record date for the bonus issue; and

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

(j) Adjustment for Rights Issue

If the Company makes an issue of Shares pro rata to existing Shareholders (other than an issue in lieu of in satisfaction of dividends or by way of dividend reinvestment) the Exercise Price of an Option will be reduced according to the following formula:

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where:

• O' = the new Exercise Price of the Option.

• O = the old Exercise Price of the Option.

• E = the number of underlying Shares into which one Option is exercisable.

• P = average market price per Share weighted by reference to volume of the underlying Shares during the 5 Trading Days ending on the day before the ex rights date or ex entitlements date.

• S = the subscription price of a Share under the pro rata issue.

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

• N = the number of Shares with rights or entitlements that must be held to receive a right to one new share.

(k) Adjustments for Reorganisation

If there is any reconstruction of the issued share capital of the Company, the rights of the Holder may be varied to comply with the Listing Rules that apply to the reconstruction at the time of the reconstruction.

(l) Quotation of Options

The Company will make no application for quotation of the Options.

(m) Options Transferable

The Options are not transferable.

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(n) Lodgement Requirements

Cheques shall be in Australian currency made payable to the Company and crossed 'Not Negotiable'. The application for Shares on the exercise of the Options with the appropriate remittance must be lodged at the Share Registry.

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West Cobar Metals Limited | ACN 649 994 669

Proxy Voting Form

If you are attending the meeting in person, please bring this with you for Securityholder registration.

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Holder Number:

Your proxy voting instruction must be received by 1.00pm (AWST) on Saturday, 22 October 2022, being not later than 48 hours before the commencement of the Meeting. Any Proxy Voting instructions received after that time will not be valid for the scheduled Meeting.

SUBMIT YOUR PROXY VOTE ONLINE

Vote online at https://investor.automic.com.au/#/loginsah

Login & Click on ‘Meetings’. Use the Holder Number as shown at the top of this Proxy Voting form.

• ✓ Save Money: help minimise unnecessary print and mail costs for the Company.

• ✓ It’s Quick and Secure: provides you with greater privacy, eliminates any postal delays and the risk of potentially getting lost in transit.

• ✓ Receive Vote Confirmation: instant confirmation that your vote has been processed. It also allows you to amend your vote if required.

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SUBMIT YOUR PROXY VOTE BY PAPER

Complete the form overleaf in accordance with the instructions set out below.

YOUR NAME AND ADDRESS

The name and address shown above is as it appears on the Company’s share register. If this information is incorrect, and you have an Issuer Sponsored holding, you can update your address through the investor portal: https://investor.automic.com.au/#/home Shareholders sponsored by a broker should advise their broker of any changes.

STEP 1 – APPOINT A PROXY

If you wish to appoint someone other than the Chair of the Meeting as your proxy, please write the name of that Individual or body corporate. A proxy need not be a Shareholder of the Company. Otherwise if you leave this box blank, the Chair of the Meeting will be appointed as your proxy by default. DEFAULT TO THE CHAIR OF THE MEETING

Any directed proxies that are not voted on a poll at the Meeting will default to the Chair of the Meeting, who is required to vote these proxies as directed. Any undirected proxies that default to the Chair of the Meeting will be voted according to the instructions set out in this Proxy Voting Form, including where the Resolutions are connected directly or indirectly with the remuneration of KMP.

STEP 2 - VOTES ON ITEMS OF BUSINESS

You may direct your proxy how to vote by marking one of the boxes opposite each item of business. All your shares 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 shares you wish to vote in the appropriate box or boxes. If you do not mark any of the boxes on the items of business, 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.

APPOINTMENT OF SECOND PROXY

You may appoint up to two proxies. If you appoint two proxies, you should complete two separate Proxy Voting Forms and specify the percentage or number each proxy may exercise. If you do not specify a percentage or number, each proxy may exercise half the votes. You must return both Proxy Voting Forms together. If you require an additional Proxy Voting Form, contact Automic Registry Services.

SIGNING INSTRUCTIONS

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

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

Power of attorney : If you have not already lodged the power of attorney with the registry, please attach a certified photocopy of the power of attorney to this Proxy Voting Form when you return it.

Companies : To be signed in accordance with your Constitution. Please sign in the appropriate box which indicates the office held by you.

Email Address : Please provide your email address in the space provided.

By providing your email address, you elect to receive all communications despatched by the Company electronically (where legally permissible) such as a Notice of Meeting, Proxy Voting Form and Annual Report via email.

CORPORATE REPRESENTATIVES

If a representative of the corporation is to attend the Meeting the appropriate ‘Appointment of Corporate Representative’ should be produced prior to admission. A form may be obtained from the Company’s share registry online at https://automic.com.au.

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Return your completed form

Return your completed form All enquiries to Automic WEBSITE BY MAIL IN PERSON BY EMAIL https://automic.com.au/ Automic Automic meetings@automicgroup.com.au GPO Box 5193 Level 5, 126 Phillip Street BY FACSIMILE PHONE Sydney NSW 2001 Sydney NSW 2000 +61 2 8583 3040 1300 288 664 (Within Australia) +61 2 9698 5414 (Overseas)

Complete and return this form as instructed only if you do not vote online

I/We being a Shareholder entitled to attend and vote at the Annual General Meeting of West Cobar Metals Limited, to be held at 1.00pm (AWST) on Monday, 24 October 2022 at Level 8, London House, 216 St Georges Terrace, Perth WA 6000 hereby:

Appoint the Chairman of the Meeting (Chair) OR if you are not appointing the Chairman of the Meeting as your proxy, please write in the box provided below the name of the person or body corporate you are appointing as your proxy or failing the person so named or, if no person is named, the Chair, 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 and at any adjournment thereof.

The Chair intends to vote undirected proxies in favour of all Resolutions in which the Chair is entitled to vote.

Unless indicated otherwise by ticking the “for”,” “against” or “abstain” box you will be authorising the Chair to vote in accordance with the Chair’s voting intention.

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AUTHORITY FOR CHAIR TO VOTE UNDIRECTED PROXIES ON REMUNERATION RELATED RESOLUTIONS

Where I/we have appointed the Chair as my/our proxy (or where the Chair becomes my/our proxy by default), I/we expressly authorise the Chair to exercise my/our proxy on Resolutions 2 and 3 (except where I/we have indicated a different voting intention below) even though Resolutions 2 and 3 are connected directly or indirectly with the remuneration of a member of the Key Management Personnel, which includes the Chair.

Resolutions For Against Abstain 1. Approval to issue Consideration Shares

1. Approval to issue Options to Mr Rob Klug

2. Approval to issue Options to Mr Matt Szwedzicki

3. Approval to issue Options to Mr Craig McNab

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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 be counted in computing the required majority on a poll.

SIGNATURE OF SECURITYHOLDERS – THIS MUST BE COMPLETED

Individual or Securityholder 1 Securityholder 2 Securityholder 3

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Sole Director and Sole Company Secretary Director Director / Company Secretary Contact Name: Email Address: Contact Daytime Telephone Date (DD/MM/YY) / / By providing your email address, you elect to receive all of your communications despatched by the Company electronically (where legally permissible).

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