ZOONO GROUP LIMITED — AGM Information 2014

Oct 26, 2014

GOLDSEARCH LIMITED ACN 006 645 754

NOTICE OF MEETING

AND EXPLANATORY MEMORANDUM

for the 2014 Annual General Meeting of the members of Goldsearch Limited to be held at the offices of Grant Thornton Australia Ltd, Level 19, Allianz Building, 2 Market Street, Sydney NSW 2000 on Friday 28 November 2014 at 11.00 am

THIS IS AN IMPORTANT DOCUMENT AND SHOULD BE READ IN ITS ENTIRETY

If you do not understand any part of this document please contact a professional adviser immediately

GOLDSEARCH LIMITED ACN 006 645 754

NOTICE OF ANNUAL GENERAL MEETING

Notice is given that the 2014 Annual General Meeting of members of Goldsearch Limited (the “Company”) will be held at the offices of Grant Thornton Australia Ltd, Level 19, Allianz Building, 2 Market Street, Sydney NSW 2000 on Friday 28 November 2014 at 11.00 am.

The business to be considered at the Annual General Meeting is set out below. Information on the proposals to which the business relates is set out in the Explanatory Memorandum which accompanies this Notice. This Notice should be read in conjunction with the accompanying Explanatory Memorandum.

Capitalised terms used in this Notice which are not defined herein have the meanings given to them in the Glossary in the accompanying Explanatory Memorandum.

ORDINARY BUSINESS

Financial statements and reports

To receive and consider the financial report, directors’ report and auditor’s report for the financial year ended 30 June 2014.

Note: This item of business is for discussion at the meeting and is not a resolution.

Resolution 1 - Remuneration report

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

“That the remuneration report for the financial year ended 30 June 2014 be adopted.”

Resolution 2 – Re-election of John Percival as director

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

“That John Percival, who retires by rotation in accordance with rule 75 of the Company’s constitution and, being eligible, offers himself for re-election, be re-elected as a director of the Company.”

Resolution 3 – Re-election of Stephen Turner as director

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

"That, Mr Stephen Turner, having been appointed as a Director of the Company since the last Annual General Meeting, who retires in accordance with rule 75 of the Constitution of the Company and being eligible, is elected as a Director of the Company."

Resolution 4 – Approval of 10% Placement Facility

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

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

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ADDITIONAL INFORMATION

This notice of meeting is accompanied by an Explanatory Memorandum which provides an explanation of the business of the meeting, including the proposed resolutions.

Voting exclusion statements

Resolution 1

In accordance with the Corporations Act, a vote on Resolution 1 must not be cast (in any capacity) by or on behalf of any of the following persons:

• (a) a member of the Key Management Personnel details of whose remuneration are included in the remuneration report;

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

However, a person described above may cast a vote on Resolution 1 if:

• the person does so as a proxy appointed in writing that specifies how the proxy is to vote on the resolution; and

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

Please note that Key Management Personnel, including the chairman, and their Closely Related Parties cannot vote on Resolution 1 as proxy unless given voting directions on the Proxy Form. Please direct your proxy how to vote by crossing the "For" or "Against" box for Resolution 1 on the Proxy Form.

Resolution 4

The Company will disregard any votes cast on Resolution 4 by a person (and any associates of such a person) who may participate in the 10% Placement Facility and a person (and any associates of such a person) who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary shares, if Resolution 4 is passed.

However, the Company will not disregard a vote if:

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

• 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 entitlement

The board of directors of Goldsearch Limited has determined in accordance with regulation 7.11.37 of the Corporations Regulations that for the purpose of voting at the Annual General Meeting, shares will be taken to be held by those who hold them at 7.00 pm (Sydney time) on Wednesday 26 November 2014. This means that if you are not the registered holder of a relevant share at the time, you will not be entitled to vote in respect of that share.

Voting by proxy

Each shareholder who is entitled to attend and vote at the Annual General Meeting may appoint a proxy to attend and vote on behalf of that shareholder. The proxy need not be a shareholder. Where a shareholder appoints only one proxy, that proxy is entitled to vote on a show of hands. If a shareholder appoints two proxies, only one proxy is entitled to vote on a show of hands.

A shareholder who is entitled to cast two or more votes may appoint one or two proxies and may specify the proportion or number of votes that each proxy is appointed to exercise. If a shareholder appoints two proxies and the appointment does not specify the proportion, or number, of shareholder's votes, each proxy may exercise half the votes (disregarding fractions).

New rules regarding proxies

Recent amendments to the Corporations Act took effect on 1 August 2011 as follows:

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Proxy vote if appointment specifies way to vote

The new section 250BB of the Corporations Act provides that an appointment of a proxy may specify the way the proxy is to vote on a particular resolution and, if it does:

• the proxy need not vote on a show of hands, but if the proxy does so, the proxy must vote that way; and

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

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

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

Transfer of non-chair proxy to chair in certain circumstances

The new section 250 of the Corporations Act provides that, if:

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

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

• at the meeting, a poll is duly demanded on the question that the resolution be passed; and

• either of the following apply:

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

• (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 that meeting.

Proxy Form

A proxy appointment form is enclosed with this notice of meeting. For the appointment of a proxy to be effective for a meeting, the following documents must be received by 11am (Sydney time) on Wednesday 26 November 2014:

• (a) the proxy's appointment; and

• (b) if the appointment is signed by the appointer's attorney – the authority under which the appointment was signed or a certified copy of the authority.

Documents may be lodged using the enclosed reply paid envelope or:

By Fax: +61 2 9290 9655 By Mail: Boardroom Pty Ltd GPO Box 3993 Sydney NSW 2000 Australia In person: Level 7 207 Kent Street Sydney NSW 2000

If mailing, please allow sufficient time for your form to be received by 11am (Sydney time) on Wednesday 26 November 2014.

Corporate representatives

A body corporate may appoint an individual as a representative to exercise all or any of the powers the body corporate may exercise at meetings of shareholders. The appointment may be a standing one. Unless otherwise specified in the appointment, the representative may exercise, on the body corporate's behalf, all of the powers that the body corporate could exercise at a meeting or in voting on a resolution.

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By order of the board of directors of Goldsearch Limited 24 October 2014

Goldsearch Limited ACN 006 645 754

2013 Annual General Meeting

EXPLANATORY MEMORANDUM

Important information

This Explanatory Memorandum has been prepared for the information of the shareholders of Goldsearch Limited (the Company) in connection with the business to be conducted at the 2014 Annual General Meeting of the Company to be held at the offices of Grant Thornton Australia Ltd, Level 19, Allianz Building, 2 Market Street, Sydney NSW 2000 on Friday 28 November 2014 at 11.00 am.

The purpose of this Explanatory Memorandum is to provide information that the Directors believe to be material to shareholders in deciding whether or not to pass the resolutions set out in the Notice.

You should read this document carefully.

This Explanatory Memorandum and the accompanying Notice are important. You should read each document in its entirety before deciding how to vote on the resolutions at the Meeting. If you are in doubt as to what you should do, you should consult your financial, legal or other professional adviser.

Glossary

Unless otherwise defined in this document, capitalised terms have the meaning set out in the Glossary at the end of this Explanatory Memorandum.

A. Resolution 1 – Remuneration Report

The annual report of the Company for the financial year ended 30 June 2014 contains a remuneration report which sets out the remuneration policies applicable to the Company and reports the remuneration arrangements that were in place for the Company's Directors and senior executives for the financial year ended 30 June 2014.

A reasonable opportunity will be provided for discussion of the remuneration report at the meeting before shareholders are asked to vote on Resolution1, to adopt the remuneration report.

The vote on the resolution is advisory only and does not bind the Directors or the Company. However, your Directors will take the outcome of the vote into consideration when reviewing the remuneration practices and policies of the Company.

Further, amendments to the Corporations Act have been made with effect from 1 July 2011 to provide that if 25% or more of the votes cast on a resolution that the remuneration report be adopted were against adoption of the report at two or more consecutive annual general meetings a resolution must then be put to the shareholders at the later AGM as to whether another meeting should be held (within 90 days) at which all Directors (other than the managing director) who were in office at the date of the later resolution must stand for re-election.

Noting that each Director has a personal interest in his own remuneration from the Company, the Board unanimously recommends that you vote in favour of Resolution1.

B. Resolution 2 – Re-election of Director

In accordance with the Company’s constitution, Mr John Percival will retire by rotation from office at the Meeting, and being eligible, offers himself for re-election as a Director.

Information on Mr Percival is set out in the Directors' Report on page 21 of the Company's 2014 Annual Report.

The Directors recommend that you vote in favour of resolution

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C. Resolution 3 – Election of Director

In accordance with the Company’s constitution, Mr Stephen Turner will retire by rotation from office at the Meeting, and being eligible, offers himself for re-election as a Director.

Information on Mr Turner is set out in the Directors' Report on page 21 of the Company's 2014 Annual Report.

The Directors recommend that you vote in favour of resolution 3

C. Resolution 4 – Approval of 10% Placement Facility

1.1 General

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

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

The Company is now seeking shareholder approval by way of a special resolution to have the ability to issue Equity Securities under the 10% Placement Facility.

The exact number of Equity Securities which may be issued under the 10% Placement Facility will be determined in accordance with the formula prescribed in Listing Rule 7.1A.2 (refer to section 3.2(c)).

1.2 Description of Listing Rule 7.1A

(a) Shareholder approval

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

(b) Equity Securities

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

The Company, as at the date of the Notice, has on issue the following classes of Equity Securities:

• ordinary shares quoted on ASX

• options not quoted on ASX

(c) Formula for calculating 10% Placement Facility

Listing Rule 7.1A.2 provides that eligible entities which have obtained shareholder approval at an annual general meeting may issue or agree to

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issue, during the 10% Placement Period (refer to section 3.2(f)), a number of Equity Securities calculated in accordance with the following formula:

(A x D) – E

Where:

A is the number of fully paid ordinary shares on issue 12 months before the date of issue or agreement:

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

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

• plus the number of fully paid ordinary shares issued in the 12 months with approval of holders of ordinary shares under Listing Rules 7.1 and 7.4;

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

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

• D is 10%

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

(d) Listing Rule 7.1 and Listing Rule 7.1A

The ability of an entity to issue Equity Securities under Listing Rule 7.1A is in addition to the entity’s 15% placement capacity under Listing Rule 7.l.

At the date of this Notice, the Company has on issue 693,638,542 ordinary shares and therefore has a capacity to issue:

• (i) 104,045,781 Equity Securities under Listing Rule 7.1; and

• (ii) subject to shareholder approval being obtained under Resolution 4, 69,363,854 Equity Securities under Listing Rule 7.1A.

The actual number of Equity Securities that the Company will have capacity to issue under Listing Rule 7.1A will be calculated at the date of issue of the Equity Securities in accordance with the formula prescribed in Listing Rule 7.1A.2 (refer to section 3.2(c)).

(e) Minimum Issue Price

The issue price of Equity Securities issued under Listing Rule 7.1A must be not less than 75% of the VWAP of Equity Securities in the same class calculated over the 15 Trading Days on which trades in that class were recorded immediately before:

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

• (ii) if the Equity Securities are not issued within five Trading Days of the date referred to in section 3.2(e)(i), the date on which the Equity Securities are issued.

(f) 10% Placement Period

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

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

• (ii) the date of the approval by shareholders of a transaction under Listing Rule 11.1.2 (a significant change to the nature or scale of activities) or 11.2 (disposal of main undertaking),

(10% Placement Period).

1.3 Listing Rule 7.1A

The effect of Resolution 4 will be to allow the Directors to issue the Equity Securities under Listing Rule 7.1A during the 10% Placement Period in addition to using the Company’s 15% placement capacity under Listing Rule 7.1.

Resolution 3 is a special resolution and therefore requires approval of at least 75% of the votes cast by shareholders entitled to vote (in person, by proxy, by attorney or, in the case of a corporate shareholder, by a corporate representative) on the Resolution.

1.4 Specific information required by Listing Rule 7.3A

Pursuant to and in accordance with Listing Rule 7.3A, information is provided in relation to the approval of the 10% Placement Facility as follows to the extent that such information is not disclosed elsewhere in this Explanatory Memorandum:

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

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

• (ii) if the Equity Securities are not issued within five Trading Days of the date in section 3.4(a)(i), the date on which the Equity Securities are issued.

• (b) There is a risk that:

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

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• (ii) the Equity Securities may be issued at a price that is at a discount to the market price for the Company’s Equity Securities in the same class on the issue date,

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

The table below shows the risk of voting dilution of existing shareholders on the basis of the current market price of shares and the current number of ordinary shares for variable ‘A’ calculated in accordance with the formula in Listing Rule 7.1A.2 as at the date of this Notice.

The table also shows:

• (i) two examples where variable ‘A’ has increased, by 50% and 100%. Variable ‘A’ is based on the number of ordinary shares the Company has on issue. The number of ordinary shares on issue may increase as a result of issues of ordinary shares that do not require shareholder approval (for example, a pro rata entitlements issue) or future specific placements under Listing Rule 7.1 that are approved at a future shareholders’ meeting; and

• (ii) two examples of where the issue price of ordinary shares has decreased by 50% and increased by 100% as against the current market price.

Variable ‘A’ in formula in Listing Rule 7.1A.2			Issue Price
		$0.001	$0.002	$0.004
		50% decrease in issue price	issue price	100% increase in issue price
Current Variable ‘A’	10% voting dilution	69,363,854 shares	69,363,854 shares	69,363,854 shares
693,638,542 shares	Funds raised	$69,364	$138,728	$277,455
50% increase in current Variable ‘A’	10% voting dilution	104,045,781 shares	104,045,781 shares	104,045,781 shares
1,040,457,813 shares	Funds raised	$104,046	$208,092	$416,183
100% increase in current Variable ‘A’	10% voting dilution	138,727,708 shares	138,727,708 shares	138,727,708 shares
1,387,277,084 shares	Funds raised	$138,728	$277,455	$554,911

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The table has been prepared on the following assumptions:

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

• No current options are exercised into shares before the date of the issue of the Equity Securities.

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

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

• The table shows only the effect of issues of Equity Securities under Listing Rule 7.1A and no other issues of Equity Securities.

• The issue of Equity Securities under the 10% Placement Facility consists only of shares.

• The issue price is $0.002, being the closing price of the shares on ASX on 20 October 2014.

• (c) The Company will only issue and allot the Equity Securities during the 10% Placement Period. The approval under Resolution 4 for the issue of the Equity Securities will cease to be valid in the event that shareholders approve a transaction under Listing Rule 11.1.2 (a significant change to the nature or scale of activities) or Listing Rule 11.2 (disposal of main undertaking).

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

• (i) non-cash consideration for the acquisition of new assets and investments. In such circumstances the Company will provide a valuation of the non-cash consideration as referred to in the Note to Listing Rule 7.1A.3; or

• (ii) cash consideration. In such circumstances, the Company intends to use the funds raised towards an acquisition of new assets or investments (including expense associated with such acquisition), continued exploration expenditure on the Company’s current assets and/or general working capital.

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

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

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

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

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

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

The allottees under the 10% Placement Facility have not been determined as at the date of this Notice but may include existing substantial shareholders and/or new shareholders who are not related parties or associates of a related party of the Company.

Further, if the Company is successful in acquiring new assets or investments, it is likely that the allottees under the 10% Placement Facility will be the vendors of the new assets or investments or the nominee of such vendors.

• (g) A voting exclusion statement is included in the Notice. At the date of the Notice, the Company has not approached any particular existing shareholder or security holder or an identifiable class of existing security holder to participate in the issue of the Equity Securities. No existing shareholder’s votes will therefore be excluded under the voting exclusion statement in the Notice.

Resolution 4 is a special resolution.

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

The chair intends to vote undirected proxies in favour of Resolution 4.

GLOSSARY

In this Explanatory Memorandum:

ASX means ASX Limited ACN 008 624 691 or the Australian Securities Exchange, as the context requires.

Board means the board of the Company.

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 dependant 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 members dealings with the Company;

• (e) a company the member controls; or

• (f) a person prescribed by the Corporations Regulations (Cth) 2001 to be a Closely .

Company means Goldsearch Limited ACN 006 645 754.

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Corporations Act means the Corporations Act 2001 (Cth).

Director means a director of the Company.

Employee means any person who is employed by the Company or any other member of the Group and any contractor who provides executive services to the Company or any other member of the Group.

Explanatory Memorandum means the explanatory memorandum accompanying the Notice.

Group means the Company and each related body corporate of the Company.

Key Management Personnel has the same meaning as in the AASB's accounting standards. Under the latter, the term key management personnel means those person having authority or responsibility for planning, directing or controlling the actions of the company, directly or indirectly, including any director (whether executive or otherwise) of the company.

Listing Rules or ASX Listing Rules means the official listing rules of ASX.

Meeting or Annual General Meeting means the annual general meeting convened by the Notice.

Notice means the notice of meeting accompanying this Explanatory Memorandum.

Proxy Form means the proxy form accompanying the Notice and the Explanatory Memorandum.