2017 ANNUAL GENERAL MEETING

Transcription

1 27 October 2017 ASX: AOH, FSE: A2O 2017 ANNUAL GENERAL MEETING 2017 Annual General Meeting Altona Mining Limited ( Altona or the Company ) is pleased to announce its 2017 Annual General Meeting will be held on Tuesday, 28 November 2017 in Perth. A Notice of Annual General Meeting and Explanatory Memorandum is appended with full details of the meeting s business. Please direct enquiries to: Alistair Cowden David Ikin Jochen Staiger Managing Director Professional Public Relations Swiss Resource Capital AG Altona Mining Limited Perth Tel: Tel: Tel: js@resource-capital.ch altona@altonamining.com david.ikin@ppr.com.au AOH0871 Altona Mining Limited Level 1, 2 Kings Park Road, West Perth WA 6005 ABN

2 ABN NOTICE OF ANNUAL GENERAL MEETING, EXPLANATORY MEMORANDUM TO SHAREHOLDERS Date of Meeting: Tuesday, 28 November 2017 Time of Meeting: 3:00pm (AWST) Place of Meeting: Quest West Perth, 54 Kings Park Road, West Perth A Proxy Form is enclosed Please read this Notice and Explanatory Memorandum carefully. If you are unable to attend the Annual General Meeting please complete and return the enclosed Proxy Form in accordance with the specified directions. Altona Mining Limited ABN st Floor, 2 Kings Park Road, West Perth WA 6005 Telephone: Facsimile: altona@altonamining.com

3 LETTER FROM THE CHAIRMAN 23 October 2017 Dear fellow Shareholder, The Notice of Meeting for the Annual General Meeting and Proxy Form are enclosed with this letter, I ask you to review the documents carefully and to cast your vote. A key part of the business of the Meeting relates to the Managing Director, Dr Alistair Cowden s Long Term Incentives (LTI), in the form of the proposed grant of Performance Rights. The grant of these Performance Rights is subject to Shareholder approval, as required by the Corporations Act and the ASX listing rules. Your Board wishes to appropriately incentivise and reward the company s senior executives to continue Altona s excellent performance. Shareholders may not be aware that valuations in statutory reports rarely reflect the actual value received by executives. When Performance Rights vest as Shares, the executive pays tax on those Shares and receives no value until they are eventually sold. All vesting is subject to the executive meeting performance hurdles that relate to creating wealth in the business. The number of Performance Rights proposed to be granted has been determined using the formula previously adopted in The grant of rights will permit the Managing Director to be properly incentivised over the critical period where the Company will seek to realise value from the Cloncurry Project in Queensland. One of the key tasks of any board is to appoint, supervise and remunerate the Managing Director. We believe Altona has performed well under Alistair Cowden and I urge you to exercise your vote in favour of these resolutions. Kevin Maloney Chairman Altona Mining Limited Notice of Annual General Meeting 1.

4 NOTICE OF ANNUAL GENERAL MEETING Notice is given that the Annual General Meeting of Shareholders of Altona Mining Limited ABN (Company) will be held at Quest West Perth, 54 Kings Park Road, West Perth on Tuesday, 28 November 2017 at 3:00pm for the purpose of transacting the following business referred to in this Notice of Annual General Meeting. AGENDA Financial Reports To receive and consider the financial report of the Company for the year ended 30 June 2017, together with the Directors Report and the Auditor's Report as set out in the Annual Report. Resolution 1: Re-election of Mr Paul Hallam as a Director To consider and, if thought fit, to pass the following resolution as an ordinary resolution: "That, Mr Paul Hallam, who retires in accordance with clause 13.2 of the Constitution and, being eligible for re-election, be re-elected as a Director." Resolution 2: Non Binding Resolution to adopt Remuneration Report To consider and, if thought fit, pass the following resolution as a non-binding resolution: "That the Remuneration Report for the year ended 30 June 2017 as set out in the 2017 Annual Report be adopted." Note: The vote on this Resolution is advisory only and does not bind the Directors or the Company. Shareholders are encouraged to read the Explanatory Memorandum for further details on the consequences of voting on this Resolution. Voting exclusion statement: The Company will disregard any votes cast on Resolution 2 by or on behalf of a member of the Key Management Personnel whose remuneration details are included in the Remuneration Report, or their Closely Related Parties. However, the Company need not disregard a vote if: it is cast by a person as a proxy appointed by writing that specifies how the proxy is to vote on the proposed Resolution or the proxy is the Chair of the Meeting and the appointment of the Chair as proxy does not specify the way the proxy is to vote on the resolution and expressly authorises the Chair to exercise the proxy even if the resolution is connected directly or indirectly with the remuneration of a member of the Key Management Personnel; and (b) it is not cast on behalf of a member of the Key Management Personnel whose remuneration details are included in the Remuneration Report, or their Closely Related Parties. Further, a Restricted Voter who is appointed as a proxy will not vote on Resolution 2 unless: the appointment specifies the way the proxy is to vote on Resolution 2; or (b) the proxy is the Chair of the Meeting and the appointment expressly authorises the Chair to exercise the proxy even though the Resolution is connected directly or indirectly with the remuneration of a member of the Key Management Personnel. Shareholders should note that the Chair intends to vote any undirected proxies in favour of Resolution 2. In exceptional circumstances, the Chair of the Meeting may change his voting intention on Resolution 2, in which case an ASX announcement will be made. Shareholders may also choose to direct the Chair to vote against Resolution 2 or to abstain from voting. If you purport to cast a vote other than as permitted above, that vote will be disregarded by the Company (as indicated above) and you may be liable for breaching the voting restrictions that apply to you under the Corporations Act. Altona Mining Limited Notice of Annual General Meeting 2.

5 Resolution 3: Issue of Performance Rights to Dr Alistair Cowden To consider and, if thought fit, to pass the following resolution as an ordinary resolution: "That, for the purposes of section 208 of the Corporations Act, Listing Rule and all other purposes the Directors are authorised to issue 2,991,000 Performance Rights to Dr Alistair Cowden or his nominee, on the terms and conditions set out in the Explanatory Memorandum." Voting exclusion statement: The Company will disregard any votes cast on Resolution 3 by any Director (who is eligible to participate in the employee incentive scheme in respect of which the approval is sought) and any of their Associates. However, the Company need not disregard a vote if: it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form; or (b) the vote 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. In accordance with section 224 of the Corporations Act, the Company will also disregard any votes cast on Resolution 3 (in any capacity) by or on behalf a related party of the Company to whom the resolution would permit a financial benefit to be given or an Associate of such a related party. However, the Company need not disregard a vote if it is cast by a person as a proxy appointed by writing that specifies how the proxy is to vote on Resolution 3 and it is not cast on behalf of a related party of the Company to whom the resolution would permit a financial benefit to be given or an Associate of such a related party. Further, a Restricted Voter who is appointed as a proxy will not vote on Resolution 3 unless: the appointment specifies the way the proxy is to vote on Resolution 3; or (b) the proxy is the Chair of the Meeting and the appointment expressly authorises the Chair to exercise the proxy even though Resolution 3 is connected directly or indirectly with the remuneration of a member of the Key Management Personnel. Shareholders should note that the Chair intends to vote any undirected proxies in favour of this Resolution 3. In exceptional circumstances, the Chair of the Meeting may change his voting intention on Resolution 3, in which case an ASX announcement will be made. Shareholders may also choose to direct the Chair to vote against Resolution 3 or to abstain from voting. If you purport to cast a vote other than as permitted above, that vote will be disregarded by the Company (as indicated above) and you may be liable for breaching the voting restrictions that apply to you under the Corporations Act. Please note: If the Chair is a person referred to in the section 224 Corporations Act voting exclusion statement above, the Chair will only be able to cast a vote as proxy for a person who is entitled to vote if the Chair is appointed as proxy in writing and the Proxy Form specifies how the proxy is to vote on Resolution 3. Altona Mining Limited Notice of Annual General Meeting 3.

6 Other business To deal with any other business which may be brought forward in accordance with the Constitution and the Corporations Act. Details of the definitions and abbreviations used in this Notice are set out in the Glossary to the Explanatory Memorandum. By order of the Board Eric Hughes Company Secretary Dated: 23 October 2017 Altona Mining Limited Notice of Annual General Meeting 4.

7 VOTING INSTRUCTIONS How to vote Shareholders can vote by either: attending the Meeting and voting in person or by attorney or, in the case of corporate Shareholders, by appointing a corporate representative to attend and vote; or appointing a proxy to attend and vote on their behalf using the Proxy Form accompanying this Notice of Meeting and by submitting their proxy appointment and voting instructions in person, by post, or by facsimile. Voting in person (or by attorney) Shareholders, or their attorneys, who plan to attend the Meeting are asked to arrive at the venue 15 minutes prior to the time designated for the Meeting, if possible, so that their holding may be checked against the Company's share register and their attendance recorded. To be effective a certified copy of the Power of Attorney, or the original Power of Attorney, must be received by the Company in the same manner, and by the same time as outlined for proxy forms below. Voting by a Corporation A Shareholder that is a corporation may appoint an individual to act as its representative and vote in person at the Meeting. The appointment must comply with the requirements of section 250D of the Corporations Act. The representative should bring to the Meeting evidence of his or her appointment, including any authority under which it is signed. Voting by proxy A Shareholder entitled to attend and vote is entitled to appoint not more than two proxies. Each proxy will have the right to vote on a poll and also to speak at the Meeting. The appointment of the proxy may specify the proportion or the number of votes that the proxy may exercise. Where more than one proxy is appointed and the appointment does not specify the proportion or number of the Shareholder's votes each proxy may exercise, the votes will be divided equally among the proxies (i.e. where there are two proxies, each proxy may exercise half of the votes). A proxy need not be a Shareholder. The proxy can be either an individual or a body corporate. If a proxy is not directed how to vote on an item of business, the proxy may generally vote, or abstain from voting, as they think fit. However, where a Restricted Voter is appointed as a proxy, the proxy may only vote on Resolutions 2 and 3 in accordance with a direction on how the proxy is to vote or, if the proxy is the Chair of the Meeting and the appointment expressly authorises the Chair to exercise the proxy even if the Resolution is connected directly or indirectly with the remuneration of a member of the Key Management Personnel. Should any resolution, other than those specified in this Notice, be proposed at the Meeting, a proxy may vote on that resolution as they think fit. If a proxy is instructed to abstain from voting on an item of business, they are directed not to vote on the Shareholder's behalf on the poll and the Shares that are the subject of the proxy appointment will not be counted in calculating the required majority. Altona Mining Limited Notice of Annual General Meeting 5.

8 Shareholders who return their Proxy Forms with a direction how to vote, but who do not nominate the identity of their proxy, will be taken to have appointed the Chair of the Meeting as their proxy to vote on their behalf. If a Proxy Form is returned but the nominated proxy does not attend the Meeting, the Chair of the Meeting will act in place of the nominated proxy and vote in accordance with any instructions. Proxy appointments in favour of the Chair of the Meeting, the secretary or any Director that do not contain a direction how to vote will be used, where possible, to support each of the Resolutions proposed in this Notice, provided they are entitled to cast votes as a proxy under the voting exclusion rules which apply to some of the proposed Resolutions. In exceptional circumstances, the Chair of the Meeting may change his voting intention on Resolutions 2 and 3, in which case an ASX announcement will be made. These rules are explained in this Notice. To be effective, proxies must be received by 3:00pm (AWST) on Sunday, 26 November Proxies received after this time will be invalid. Proxies may be lodged using any of the following methods: by returning a completed Proxy Form in person or by post using the pre-addressed envelope provided with this Notice to: Computershare GPO Box 242 MELBOURNE VIC 3001; or by faxing a completed Proxy Form to: (within Australia) or (outside Australia). The Proxy Form must be signed by the Shareholder or the Shareholder's attorney. Proxies given by corporations must be executed in accordance with the Corporations Act. Where the appointment of a proxy is signed by the appointer's attorney, a certified copy of the Power of Attorney, or the power itself, must be received by the Company at the above address, or by facsimile, and by 3:00pm (AWST) on Sunday, 26 November If facsimile transmission is used, the Power of Attorney must be certified. Shareholders who are entitled to vote In accordance with paragraphs and of the Corporations Regulations, the Board has determined that a person's entitlement to vote at the Annual General Meeting will be the entitlement of that person set out in the Register of Shareholders as at 4:00pm (AWST) on 26 November Altona Mining Limited Notice of Annual General Meeting 6.

9 EXPLANATORY MEMORANDUM This Explanatory Memorandum is intended to provide Shareholders with sufficient information to assess the merits of the Resolutions contained in the accompanying Notice of Annual General Meeting of the Company. Certain abbreviations and other defined terms are used throughout this Explanatory Memorandum. Defined terms are generally identifiable by the use of an upper case first letter. Details of the definitions and abbreviations are set out in the Glossary to the Explanatory Memorandum. Financial Reports The first item of the Notice deals with the presentation of the consolidated annual financial report of the Company for the financial year ended 30 June 2017, together with the Directors' declaration and report in relation to that financial year and the Auditor's Report on the financial report. Shareholders should consider these documents and raise any matters of interest with the Directors when this item is being considered. No resolution is required to be moved in respect of this item. Shareholders will be given a reasonable opportunity at the Annual General Meeting to ask questions and make comments on the accounts and on the management of the Company. The Chair will also give Shareholders a reasonable opportunity to ask the Auditor or the Auditor s representative questions relevant to: the conduct of the audit; (b) the preparation and content of the independent audit report; (c) the accounting policies adopted by the Company in relation to the preparation of the financial statements; and (d) the independence of the Auditor in relation to the conduct of the audit. The Chair will also allow a reasonable opportunity for the Auditor or their representative to answer any written questions submitted to the Auditor under section 250PA of the Corporations Act. Resolution 1: Re-election of Mr Paul Hallam as a Director Pursuant to Clause 13.2 of the Company's Constitution, Mr Paul Hallam, being a Director, retires by way of rotation and, being eligible, offers himself for re-election as a Director. Mr Hallam was appointed to the Board in March 2013 and is Altona s Non-Executive Chairman, and has therefore held office for approximately 4 years and 9 months. Mr Hallam is a qualified mining engineer. He has a wealth of industry experience and over fifteen years experience as a director of various publicly listed companies, government and industry bodies. His former executive roles include Director of Operations for Fortescue Metals Group Ltd, Executive General Manager Development and Projects for Newcrest Mining Ltd, Director Victorian Operations for Alcoa and Executive General Manager Base and Precious Metals for North Ltd. Mr Hallam also held senior mine management/development roles for Battle Mountain Gold Company in Chile, Bolivia and Australia, and for Alcoa, Newmont and North Ltd in Australia in both underground and surface mining operations. The Board considers Mr Hallam to be an independent director. Mr Hallam currently holds non-executive board positions with Gindalbie Metals Group Limited (appointed 13 December 2011) and Sandfire Resources NL (appointed 21 May 2013) The Board (other than Mr Hallam) recommends that Shareholders vote in favour of the resolution to re-elect Mr Hallam. Altona Mining Limited Notice of Annual General Meeting 7.

10 Resolution 2: Adoption of Remuneration Report Section 250R(2) of the Corporations Act requires the Company to put to its Shareholders a resolution that the Remuneration Report as disclosed in the Company's 2017 Annual Report be adopted. The Remuneration Report is set out in the Company s 2017 Annual Report and is also available on the Company s website ( The vote on Resolution 2 is advisory only and does not bind the Directors or the Company. However, if less than 75% of the votes cast are for adoption of the Remuneration Report at two consecutive Annual General Meetings, the Company will be required to put a resolution to the second Annual General Meeting (Spill Resolution), to call a general meeting (Spill Meeting). If more than 50% of Shareholders vote in favour of the Spill Resolution, the Company must then convene a Spill Meeting within 90 days. All of the Directors, other than the Managing Director, will need to stand for re-election at the Spill Meeting if they wish to continue as Directors. More than 75% of votes at the last Annual General Meeting were for the adoption of the Remuneration Report and therefore a Spill Resolution is not required at the Meeting. The Chair will give Shareholders a reasonable opportunity to ask questions about, or make comments on, the Remuneration Report. Voting Note that a voting exclusion applies to Resolution 2 in the terms set out in the Notice of Meeting. Shareholders are urged to carefully read the Proxy Form and provide a direction to the proxy on how to vote on this Resolution. Resolution 3: Issue of Performance Rights to Dr Alistair Cowden Background The Company proposes to issue Performance Rights to the Company s Managing Director, Dr Alistair Cowden pursuant to the Awards Plan. Dr Cowden has considerable responsibilities and challenges as Managing Director. The grant of these Performance Rights will provide a long term incentive for outstanding performance and will promote his opportunity for Share ownership in the Company and alignment with Shareholder interests. Your Board believes that the Managing Director has delivered an outstanding performance. 10 years of his commitment and persistence in Finland led to the development, operation and ultimately the sale of the Company s assets in Finland for A$112 million with $80 million being returned to Shareholders as a dividend and return of capital. The Managing Director and his team also transformed the Cloncurry Project, doubling resources, making the first new discovery in the area for decades and bringing the project to the point of development such that it can attract a development partner. They are tasked with concluding a transaction that delivers value to Shareholders from Cloncurry and this issue provides incentive to deliver a superior outcome. Altona Mining Limited Notice of Annual General Meeting 8.

11 Performance Rights Number of Performance Rights It is proposed that 2,991,000 Performance Rights are issued to Dr Cowden, subject to Shareholder approval pursuant to Resolution 3. The formula used to calculate the number of Performance Rights to be issued has been determined on the basis of advice from an independent remuneration consultant engaged by the Company s Remuneration Committee and is: Number of Performance Rights = (total fixed remuneration as at 1 July 2017 x 0.45) 2 x 20 Day VWAP as at 1 July 2017 A 20 day volume weighted average price of Shares as at 1 July 2017 has been adopted to reflect unusual volatility in the Share price. Terms and Conditions The Performance Rights will be issued on the terms and conditions set out in the Awards Plan and will be subject to the performance hurdles set out below. Testing Dates 2,991,000 Performance Rights will be available for vesting on 1 July Vesting will be subject to testing the achievement of performance hurdles set out below. Performance Hurdles On the testing date, the TSR on Shares from a reference share price of 13.5 cents will be measured against the change in the ASX Small Resource Index (XSR) at July over the measurement period of 3 years from 1 July 2017 to 1 July Should the applicable TSR: exceed the change in the XSR by 25% or more, then 100% of the Performance Rights available for vesting will vest; be less than the change in the XSR, no Performance Rights will vest; and exceed the change in XSR by less than 25%, then the Performance Rights will vest on a pro rata basis up to 100%. All Performance Rights will lapse if the performance hurdles are not satisfied on 1 July 2020 and otherwise in accordance with the terms of the Awards Plan. Related party transactions Chapter 2E of the Corporations Act prohibits a public company from giving a financial benefit to a related party of the public company unless either: (b) the giving of the financial benefits falls within one of the nominated exceptions to the provision; or Shareholder approval is obtained prior to the giving of the financial benefit and the benefit is given within 15 months after obtaining such approval. Altona Mining Limited Notice of Annual General Meeting 9.

12 Further, section 208(2) of the Corporations Act provides that if: (b) (c) the giving of the benefit is required by a contract; and the making of the contract was approved in accordance with 208(1) as a financial benefit given to a related party; and the contract was made within 15 months after that approval or before that approval if the contract was conditional upon that approval being obtained, then member approval for the giving of the benefit is taken to have been given and the benefit need not be given within 15 months. For the purposes of Chapter 2E of the Corporations Act, Dr Cowden is a related party of the Company. Resolution 3 relates to the proposed grant and agreement to grant Performance Rights to Dr Alistair Cowden (or his nominee), which are financial benefits that require Shareholder approval for the purposes of section 208 of the Corporations Act. Information requirements - Chapter 2E of the Corporations Act For the purposes of Chapter 2E of the Corporations Act, the following information is provided. The related parties to whom the proposed resolutions would permit the financial benefit to be given and the nature of the financial benefit As noted above, the related party is Dr Alistair Cowden (or his permitted nominee) who is the Company s Managing Director. The nature of the financial benefit is the issue of the Performance Rights. No consideration will be paid for the issue of the Performance Rights, or their conversion to Shares upon vesting. The details of the financial benefit including reasons for giving the type and quantity of the benefit The proposed grant of Performance Rights to Dr Cowden will be subject to the terms of the Company's Awards Plan. The grant of Performance Rights encourages Dr Cowden to have a greater involvement in the achievement of the Company s objectives and to provide an incentive to strive to that end by participating in the future growth and prosperity of the Company through Share ownership. Under the Company s current circumstances, the Directors (in the absence of Dr Cowden) consider that the incentives intended for Dr Cowden represented by the grant of the Performance Rights are a cost effective and efficient means for the Company to provide a reward and an incentive, as opposed to alternative forms of incentive, such as the payment of additional cash compensation. Altona Mining Limited Notice of Annual General Meeting 10.

13 The grant of Performance Rights to Dr Cowden also reflects the Board s desire to: (b) (c) (d) ensure that the remuneration offered is competitive with market standards and market practice. The Directors (in the absence of Dr Cowden) consider the proposed number of Performance Rights to be granted will ensure that Dr Cowden s overall remuneration is in line with market practice; attract and retain suitably qualified executives; acknowledge the extensive experience and reputation of Dr Cowden within the mining industry; and provide incentives to attract and ensure continuity of service of Dr Cowden, while maintaining the Company s cash reserves. The number of Performance Rights that may be granted to Dr Cowden is determined based upon a formula, which takes into consideration: (b) Dr Cowden s fixed remuneration; and the current price of Shares. The Company does not consider that there are any significant opportunity costs to the Company or benefits foregone by the Company in issuing the Performance Rights on the terms proposed. Dr Cowden s current holdings Set out below are details of each of Dr Cowden s relevant interest in Shares and Performance Rights as at the date of this Notice which are held both directly by Dr Cowden and indirectly via entities that Dr Cowden controls. Name Number of Shares Number of Performance Share Rights Dr Alistair Cowden 12,677,626 3,856,800 Dilution effect of grant of Performance Share Rights on existing members interests If passed, Resolution 3 will give the Directors authority to grant a total of 2,991,000 Performance Rights. The Company currently has 536,975,592 Shares and 8,419,200 Performance Rights on issue. If all 2,991,000 Performance Rights the subject of Resolution 3 are granted to Mr Cowden and are converted, the effect would be to dilute the shareholding of existing Shareholders by 0.56% on an undiluted basis. Dr Cowden s total remuneration package Dr Cowden s remuneration per annum (including superannuation) and the total financial benefit to be received by Dr Cowden in each respective financial period, as a result of the grant of the Performance Rights the subject of Resolution 3, is as follows: Financial Year ended 30 June Total Fixed Remuneration Gross Statutory Accounting Value of Performance Rights Total Financial Benefit 2018 $468,291 $254,235 $722,526 The indicative valuation of the Performance Rights as set out above is a theoretical valuation derived from a Monte Carlo Model. Altona Mining Limited Notice of Annual General Meeting 11.

14 Valuation of Performance Rights The Company's advisers have valued the Performance Rights to be granted to Dr Alistair Cowden using the Monte Carlo Model. The value of a Performance Right calculated by the Monte Carlo Model is a function of a number of assumptions as follows: Variable Input Performance Rights Share price $0.135 Risk Free Interest Rate 2.10% Volatility 60% Time (years to expiry) 2.73 Value per Share Right $0.085 The Company s advisers have calculated the value of each Performance Right based on the following assumptions: (b) (c) they have based the underlying value of each Share in the Company on the ASX closing price of A$0.135 on 10 October 2017; risk free rate of return % as at 10 October 2017 (estimated, based on the three year Australian Bond rate); and they used a volatility of the Share price of 60% as determined from the daily movements in Share price over each of the last 1, 2 and 3 year periods. Based on the assumptions, it is considered that the estimated average value of the Performance Share Rights to be granted to Dr Cowden is $0.085 per Performance Share Right. Any change in the variables applied in the Monte Carlo Model calculation between the date of the valuation and the date the Performance Rights are granted would have an impact on their value. Company s historical Share price The following table gives details of the highest, lowest and latest closing prices of the Company s Shares trading on ASX over the past 12 months ending on 16 October 2017: Highest Price (A$)/Date Lowest Price (A$)/Date Latest Price (A$)/Date $0.17 / 20 March 2017 $0.09 / 24 July 2017 $0.13 / 16 October 2017 Other information Under the Australian Equivalent of IFRS, the Company is required to establish a value of the benefit based on principles set out in Australian Accounting Standards. An element of this value will then be expensed the Company s statement of financial performance for the current financial year. The value attributed to Performance Rights by the Australian Taxation Office will differ to the value ascribed to the same benefit. Other than as disclosed in this Explanatory Memorandum, the Directors do not consider that from an economic and commercial point of view, there are any costs or detriments including opportunity costs or taxation consequences for the Company or benefits foregone by the Company in granting the Performance Rights pursuant to Resolution 3. Neither the Directors nor the Company are aware of other information that would be reasonably required by Shareholders to make a decision in relation to the financial benefits contemplated by Resolution 3. Altona Mining Limited Notice of Annual General Meeting 12.

15 Directors recommendation All the Directors were available to make a recommendation. For the reasons noted above: Messrs Maloney, Hallam and Scudamore (who have no interest in the outcome of Resolution 3) recommend that Shareholders vote in favour of Resolution 3. Dr Cowden declines to make a recommendation about Resolution 3 as he has a material personal interest in the outcome of that particular resolution as it relates to the proposed issue of Performance Rights to him or his nominee. The Board (other than Dr Cowden) is not aware of any other information that would be reasonably required by Shareholders to make a decision whether it is in the best interests of the Company to pass Resolution 3. Information Requirements - Listing Rules and 10.15A Listing Rule requires Shareholder approval by ordinary resolution for any issue of securities by a listed company to a related party under an employee incentive scheme. Accordingly, Listing Rule requires Shareholders to approve the issue of Performance Rights under the Awards Plan to Dr Cowden. The following information is provided to Shareholders in relation to Resolution 3 for the purposes of Listing Rule 10.15A: the Performance Rights will be granted to Dr Alistair Cowden (or his nominee) as noted above; (b) the maximum number of Performance Rights to be granted pursuant to Resolution 3 is 2,991,000; (c) (d) (e) (f) (g) (h) (i) the Performance Rights will be granted for no consideration (nil issue price); no funds will be raised by the grant of the Performance Rights; 13,523,467 Performance Share Rights have been previously issued to Dr Cowden under the Awards Plan and each such Performance Right was issued for no consideration. 2,000,001 of these share rights have been cancelled as the testing criteria was not satisfied on the relevant test date and 7,666,666 have vested having satisfied the testing criteria in the relevant date. all Directors, or their permitted nominees, are entitled to participate in the Awards Plan but for the purposes of Resolution 3 at this time the Company is only seeking to grant Performance Rights to Dr Cowden. A summary of the Awards Plan is attached as Annexure A ; no loan is provided in connection with the acquisition or conversion of the Performance Rights; details of any securities issued under the Awards Plan will be published in each Annual Report of the Company relating to the period in which securities have been issued. Any additional persons who become entitled to participate in the Awards Plan and who are not named in this Notice will not participate until approval is obtained under Listing Rule 10.14; and the Performance Rights will be issued as soon as practical after the Meeting, and in any event no later than 3 years after the date Shareholder approval is obtained for Resolution 3. If approval is given for the issue of the Performance Rights under Listing Rule 10.14, approval is not required under Listing Rule 7.1. Voting Note that a voting exclusion applies to Resolution 3 in the terms set out in the Notice of Meeting. Shareholders are urged to carefully read the Proxy Form and provide a direction to the proxy on how to vote on this Resolution. Altona Mining Limited Notice of Annual General Meeting 13.

16 GLOSSARY $ means Australian dollars. 60 Day VWAP means the 60 day volume weighted average price of Shares for trading days where trading in Shares was not halted or suspended. Accounting Standards has the meaning given to that term in the Corporations Act. Annual Report means the annual report of the Company for the year ended 30 June Associate has the meaning given in sections 12 and 16 of the Corporations Act. Section 12 is to be applied as if paragraph 12(1) included a reference to the Listing Rules and on the basis that the Company is the designated body for the purposes of that section. A related party of a director or officer of the Company or of a Child Entity of the Company is to be taken to be an associate of the director or officer unless the contrary is established. ASX means ASX Limited ABN and, where the context permits, the Australian Securities Exchange operated by ASX Limited. Auditor means the Company s auditor from time to time (if any). Auditor s Report means the report of the Auditor contained in the Annual Report for the year ended 30 June Award means an Option or Performance Share Right granted under the Awards Plan. Awards Plan means the Altona Mining Limited Awards Plan. AWST means Australian western standard time. Board means the Directors. Chair or Chairman means the individual elected to chair any meeting of the Company from time to time. Child Entity has the meaning given to that term in the Listing Rules. Closely Related Party has the meaning given to that term in the Corporations Act. Company means Altona Mining Limited ABN Constitution means the Company's constitution, as amended from time to time. Corporations Act means Corporations Act 2001 (Cth). Directors means the directors of the Company. Explanatory Memorandum means the explanatory memorandum accompanying this Notice. Key Management Personnel has the meaning given to that term in the Accounting Standards. Listing Rules means the ASX Listing Rules. Meeting means the Annual General Meeting convened by the Notice. Notice means this Notice of Annual General Meeting. Altona Mining Limited Notice of Annual General Meeting 14.

17 Notice of Meeting means this Notice of Annual General Meeting. Option means an option, each to acquire one Share, issued under the Awards Plan. Performance Right means a conditional right to acquire a Share, issued under the Awards Plan. Proxy Form means the proxy form accompanying the Notice. Remuneration Report means the remuneration report set out in the Annual Report for the year ended 30 June Resolution means a resolution contained in the Notice. Restricted Voter means Key Management Personnel and their Closely Related Parties as at the date of the Meeting. Shareholder means a member of the Company from time to time. Shares means fully paid ordinary shares in the capital of the Company. Spill Meeting has the meaning given to in the Explanatory Memorandum to Resolution 2. Spill Resolution the meaning given to in the Explanatory Memorandum to Resolution 2 Trading Day means a day determined by ASX to be a trading day in accordance with the Listing Rules. TSR means total shareholder return. Altona Mining Limited Notice of Annual General Meeting 15.

18 ANNEXURE A: SUMMARY OF ALTONA MINING LIMITED AWARDS PLAN Under the Awards Plan, the Board may offer the opportunity to full-time or part-time employees, certain contractors or Directors of a Group Company (Eligible Persons) or their eligible nominees to participate in the Awards Plan and subscribe for such number of Awards as the Board may decide and on the terms set out in the rules of the Awards Plan. Awards granted under the Awards Plan will be offered on the basis of the Board s view of the contribution of the Eligible Person to a Group Company. Awards will be issued subject to exercise conditions or performance hurdles, which must be satisfied (or waived) before either the Options can be exercised or the Performance Rights vest. The exercise conditions or performance hurdles may be a combination of Total Shareholder Return (TSR), being the change in the Share price over the relevant measurement period and adjusted for capital returns and dividends (if any), the achievement of personal performance indicators or major milestones for a Group Company Part A The following is a summary of Part A of the Awards Plan, which relates to Options: Terms and Conditions of Options: The Board may, in its absolute discretion, determine the terms and conditions of the Options to be offered to Eligible Persons under the Awards Plan, including the exercise price, expiry date, and any exercise conditions which need to be fulfilled before the Options may be exercised. The Board will have regard to the market value of the Shares at the time it resolves to offer Options in determining the exercise price of the Options. Not transferable: Options are not transferable (except in certain circumstances to an Option holder s legal personal representative). No payment for grant of Options: An Eligible Person will not pay anything for the grant of Options (unless the Board determines otherwise). The Eligible Person must pay the relevant exercise price to the Company to exercise the Options into Shares. Not listed: The Company will not apply for quotation of the Options on ASX. Exercise of Options: Subject to any exercise conditions set by the Board, Options may be exercised at any time before the relevant expiry date. If there is a change of control event (ie. a shareholder or group of shareholders, becoming entitled to sufficient Shares in the Company to give it the ability, and that ability is successfully exercised in general meeting, to replace all or a majority of the Board); it is during a bid period or on application under section 411 of the Corporations Act a court orders a scheme meeting for the reconstruction of the Company or the amalgamation of the Company either another company, Options will be exercisable notwithstanding exercise conditions may not have been met. Pro-rata issues, bonus issues, reorganisations of capital and winding up: (b) (c) Options do not carry any rights to the holder to participate in any issue of securities to existing Shareholders; if there is a bonus issue to Shareholders, the number of Shares over which an Option is exercisable will be increased by the number of Shares which the option holder would have received if the Option had been exercised before the record date of the bonus issue; if there is a pro-rata issue (other than a bonus issue) to Shareholders, the exercise price of the Options will be reduced according to the formula provided in the Listing Rules; Altona Mining Limited Notice of Annual General Meeting 16.

19 (d) (e) if there is reorganisation of the issued capital of the Company, then the rights of the Option holder (including the number of Options to which the Option holder is entitled and the exercise price) is changed to the extent necessary to comply with the Listing Rules applying to a reorganisation or capital at the time of the reorganisation; and if a resolution for a member s voluntary winding up of the Company is proposed (other than for the purpose of a reconstruction or amalgamation) the Board may, in its absolute discretion, give written notice to the option holder of the proposed resolution. Subject to the exercise conditions of the options, the option holder may, in the period referred to in the Notice, exercise their Options. Lapse of Options: (b) (c) (d) Options not validly exercised on or before their expiry date will automatically lapse. Unless otherwise determined by the Board, if Options are granted subject to exercise conditions and, prior to satisfaction of the exercise conditions, an Eligible Person ceases to be a Eligible Person for any reason other than a specified reason (which includes retirement, total and permanent disablement, redundancy or death), such Options held by the Eligible Person (or his or her permitted nominee) will automatically lapse. Unless otherwise determined by the Board, if Options are granted subject to exercise conditions and, prior to satisfaction of the exercise conditions an Eligible Person ceases to be an Eligible person because of a specified reason, any Options held by the Eligible Person (or his or her permitted nominee) may be exercised within 6 months of the relevant specified reason event, or such longer period as the Board determines, subject to the Board waiving or varying the exercise conditions of the Options so that they may be exercised. Options not exercised within the 6 months or the longer period set by the Board will automatically lapse. Unless otherwise determined by the Board, if an Eligible Person ceases to be an Eligible Person at any time after an Option is or has become exercisable, the Eligible Person (or his or her permitted nominee) may exercise such Options at any time prior to their expiry date. Part B The following is a summary of Part B of the Awards Plan, which relates to Performance Rights: Nature of Performance Rights: A Performance Right is a right to receive a Share on the terms set out in the Awards Plan for the relevant performance period and subject to satisfaction of the applicable performance hurdles. The performance period, performance hurdles and test dates for measuring the performance hurdles will be determined by the Board from time to time. Not transferable: Except upon the death of a holder, a Performance Right may not be transferred, assigned or novated except with the approval of the Board. No payment: An Eligible Person will not pay anything for the grant of Performance Rights and no amount will be payable by the holder of a Performance Right on the automatic exercise of the Performance Right. Not listed: The Company will not apply for quotation of the Performance Rights on ASX. Altona Mining Limited Notice of Annual General Meeting 17.

20 Vesting: Performance Rights may vest in the following ways: (b) (c) If the applicable performance hurdles are satisfied as at the relevant test date. If the holder ceases to be an Eligible Person because of a specified event, the Board may determine that unvested Performance Rights will vest, in which case the Board will have regard to the contribution of the Eligible Person to the Company and the circumstance in which the Eligible Person ceased to be an Eligible Person. Unvested Performance Rights that have not lapsed will vest if a takeover bid (as defined in the Corporations Act) to acquire Shares becomes unconditional; at any time after a Change of Control Event (as defined above) has occurred; or if a merger by way of scheme of arrangement under the Corporations Act has been approved by the Court. Automatic Exercise: Performance Rights are automatically exercised if they vest. The Company must issue new Shares or procure the transfer of existing Shares to the holder immediately upon vesting of Performance Rights. New Issues: Performance Rights do not confer on the holder a right to participate in new issues of Shares by the Company, including by way of bonus issue, rights issue, or otherwise. Variations of capital: If there are certain variations of the share capital of the Company including a capitalisation or rights issue, sub-division, consolidation or reduction of share capital, a demerger or other distribution in specie, the Board may make one of the following adjustments as it considers appropriate, in accordance with the provisions of the Listing Rules: (b) the number of Shares which may be issued or transferred upon exercise of any of the Performance Share Rights; or where Performance Rights have been exercised but no Shares have been issued or transferred following the exercise, the number of Shares, which may be issued or transferred. Lapse: Unless otherwise determined by the Board, a Performance Right lapses on the earlier to occur of: (b) (c) (d) (e) where performance hurdles have not been satisfied on the test date - the date the Board makes a determination that the Performance Right will lapse; if an Eligible Person ceases to be an Eligible Person because of a specified reason any Performance Rights held by the Eligible Person (or his or her permitted nominee) may be exercised within 6 months of the relevant specified reason event, or such longer period as the Board determines, subject to the Board determining the Performance Rights will vest. Performance Rights not exercised within the 6 months or the longer period set by the Board will automatically lapse. if an Eligible Person ceases to be an Eligible Person for any reason other than a specified reason the date they so cease; the day the Board makes a determination that the Performance Rights lapse for breach, fraud or dishonesty by the holder; and the expiry date of the Performance Rights. Altona Mining Limited Notice of Annual General Meeting 18.