KGL Resources : Notice of Extraordinary General Meeting/Proxy Form

Notice of extraordinary general meeting

KGL Resources Limited ACN 082 658 080

Notice is given that the extraordinary general meeting of KGL Resources Limited (KGL) will be held at:

Location	Offices of McCullough Robertson Lawyers, Level 11, 66 Eagle Street, Brisbane, Queensland, 4000
Date	Monday, 23 October 2017
Time	9.30am (Brisbane time)

Special Business Resolution 1 - Ratification of previous issue of Shares to institutional and sophisticated investors

To consider, and if in favour, pass the following resolution as an ordinary resolution:

'That, for the purposes of ASX Listing Rule 7.4 and for all other purposes, shareholders ratify the previous issue of 18,500,000 Shares at an issue price of $0.30 per Share, as detailed in the Explanatory Memorandum.'

Note: KGL will disregard any votes cast by or on behalf of any person who participated in the issue of securities and any of their associates.

The Directors unanimously recommend that you vote in favour of Resolution 1.

Resolution 2 - Approval of issue of Shares to Mr Denis Wood

To consider, and if in favour, pass the following resolution as an ordinary resolution:

'That for the purposes of ASX Listing Rule 10.11 and for all other purposes, shareholders approve the issue of 4,000,000 Shares to Mr Denis Wood (or entities controlled by him) at an issue price of $0.30 per Share, on the terms set out in the Explanatory Memorandum.

Note: KGL will disregard any votes cast by Mr Wood and any of his associates.

The Directors (with Mr Wood abstaining) recommend that you vote in favour of Resolution 2.

Resolution 3 - Approval of issue of Shares to Mr Ferdian Purnamasidi

To consider, and if in favour, pass the following resolution as an ordinary resolution:

'That for the purposes of ASX Listing Rule 10.11 and for all other purposes, shareholders approve the issue of 333,333 Shares to Mr Ferdian Purnamasidi at an issue price of $0.30 per Share, on the terms set out in the Explanatory Memorandum.

Note: KGL will disregard any votes cast by Mr Purnamasidi and any of his associates.

The Directors (with Mr Purnamasidi abstaining) recommend that you vote in favour of Resolution 3. Dated: 22 September 2017

By order of the Board

Kylie Anderson Company Secretary

Notes

1. A shareholder who is entitled to attend and cast a vote at the meeting is entitled to appoint a proxy.

2. The proxy need not be a shareholder of the Company. A shareholder who is entitled to cast two or more votes may appoint two proxies and may specify the proportion or number of votes each proxy is appointed to exercise.

3. If you wish to appoint a proxy and are entitled to do so, then complete and return the attached proxy form.

4. KMP (or their closely related parties) (as defined in the Corporations Act) appointed as a proxy must not vote on a resolution connected directly or indirectly with the remuneration of KMP if the proxy is undirected unless:

5. the proxy is the person chairing the meeting; and

6. the proxy appointment expressly authorises the person chairing the meeting to vote undirected proxies on that resolution.

7. If the proxy form specifies the way the proxy is to vote on a particular resolution the proxy need not vote on a show of hands but if the proxy does so, it must vote as specified in the proxy form.

8. If the proxy has two or more appointments that specify different ways to vote on the resolution the proxy must not vote on a show of hands.

9. If the proxy is the chair of the meeting, the proxy must vote on a poll or must vote the way specified in the proxy form.

10. If the proxy is not the chair of the meeting the proxy need not vote on the poll, but if the proxy does so, the proxy must vote as specified in the proxy form.

11. If the proxy form specifies the way the proxy is to vote on a particular resolution and the proxy is not the chair of the meeting and a poll is demanded and either:

12. the proxy is not recorded as attending; or

13. the proxy does not vote,

14. the chair of the meeting is deemed the proxy for that resolution.

15. A corporation may elect to appoint a representative, rather than appoint a proxy, under the Corporations Act in which case the Company will require written proof of the representative's appointment which must be lodged with or presented to the Company before the meeting.

16. The Company has determined under regulation 7.11.37 of the Corporations Regulations 2001 (Cth) that for the purpose of voting at the meeting or adjourned meeting, securities are taken to be held by those persons recorded in the Company's register of shareholders as at 5.00pm on 21 October 2017.

17. If you have any queries on how to cast your votes call Kylie Anderson, Company Secretary, on [phone] during business hours.

18. Voting restrictions

    Under Listing Rule 14.11, KGL will disregard any votes cast:

    Resolution 1 - Ratification of previous issue of Shares to institutional and sophisticated investors	by any person who participated in the issue or their associate.
    Resolution 2 - Approval of issue of Shares to Mr Denis Wood	by Mr Wood or any of his associates.
    Resolution 3 - Approval of issue of Shares to Mr Ferdian Purnamasidi	by Mr Purnamasidi or any of his associates.

    However, KGL need not disregard a vote if it is cast by:

19. a person as proxy for a person who is entitled to vote, under the directions on the proxy voting form; or

20. the person chairing the meeting as proxy for a person who is entitled to vote, under a direction on the proxy form to vote as the proxy decides.

21. Voting intentions of the chair

    Shareholders should be aware that the chair of the Meeting intends to vote all undirected proxies in favour of each item of business.

    Explanatory memorandum

    KGL Resources Limited ACN 082 658 080

    This Explanatory Memorandum accompanies the Notice of General Meeting of KGL to be held at the offices of McCullough Robertson Lawyers, Level 11, 66 Eagle Street, Brisbane, Queensland on Monday, 23 October 2017 at 9.30am (Brisbane time).

    The Explanatory Memorandum has been prepared to assist shareholders in determining how to vote on the resolutions proposed and ought to be read in conjunction with the Notice of Meeting.

    Background - Placement

22. On 13 September 2017, KGL announced that will undertake a capital raising of $12.4 million (before offer costs) by way of a placement of approximately 22.8 million KGL Shares to

    institutional and sophisticated investors (Placement) and a pro rata non‐renounceable rights

    issue (Entitlement Offer).

23. The Placement is being conducted in two tranches:

24. an initial placement of 18,500,000 Shares (First Tranche Shares), which completed on or about 18 September 2017 (First Tranche); and

25. a subsequent placement of an additional 4,333,333 Shares (Second Tranche Shares), to directors of KGL, which is anticipated to complete on or about Monday, 23 October 2017 (Second Tranche) (subject to shareholder approval).

26. The First Tranche Shares and the Second Tranche Shares both have an issue price of $0.30 per share (Issue Price).

27. Directors (and their controlled entities) have applied for 4,333,333 Shares, which comprise the Second Tranche Shares (and will be issued subject to Shareholder approval).

28. The funds raised from the Placement and the Entitlement Offer will be used for further drilling at KGL's 100% owned Jervois Copper Project in the Northern Territory and working capital.

29. As announced on 12 September 2017, KGL has completed down hole electromagnetic (DHEM) surveys and is awaiting assay results from recent drilling at the Reward Prospect. Separately the assays announced on 4 September 2017 for recent holes drilling at Rockface, delivered good continuity of high-grade copper mineralisation, which will assist in future exploration planning. KGL will announce the results of these assays in due course.

    Resolution 1 - Ratification of previous issue of Shares to institutional and sophisticated investors

30. Resolution 1 seeks approval from shareholders under Listing Rule 7.4 (and for all other purposes) to ratify the previous issue of the First Tranche Shares to institutional and sophisticated investors on or about 18 September 2017.

31. Listing Rule 7.1 provides that, subject to certain exemptions, prior approval of shareholders is required for an issue of equity securities if the securities will, when aggregated with the securities issued by KGL during the previous 12 months, exceed 15% of the number of the securities at the commencement of that 12 month period.

32. The issue of First Tranche Shares detailed in this resolution did not exceed KGL's 15% threshold. However, Listing Rule 7.4 provides that where KGL ratifies an issue of equity securities, the issue is treated as having been made with shareholder approval for the purpose of Listing Rule 7.1, thereby replenishing KGL's 15% capacity and enabling it to issue further equity securities up to that limit.

33. Resolution 1 proposes the ratification and approval of the allotment and issue of the First Tranche Shares for the purpose of satisfying the requirements of Listing Rule 7.4. Details of the issue are set out below.

    Issue date	18 September 2017
    Number of securities	18,500,000 KGL Shares
    Issue price per security	$0.30 per KGL Share
    Terms of issue	The Shares rank equally with all existing Shares on issue
    Allottees	KMP Investments Pte Ltd RFC Opportunities Fund Redland Plains Pty Ltd ATF Majestic Investment Trust
    Intended use of funds	Proceeds of the issue will be used to will be used for further drilling at KGL's 100% owned Jervois Copper Project in the Northern Territory and working capital.

    Directors' recommendation

34. The Directors unanimously recommend you vote in favour of this resolution.

    Resolution 2 - Approval of issue of Shares to Mr Denis Wood

35. Resolution 2 seeks approval from shareholders under Listing Rule 10.11 (and for all other purposes) for the issue of Shares to Mr Denis Wood, Executive Chairman of KGL, as part of the issue of Placement Shares.

36. Listing Rule 10.11 requires KGL to obtain the approval of shareholders prior to the issue of securities to a related party. 'Related party' is defined in the Listing Rules to include the Directors and their spouses, as well as entities controlled by the Directors. Therefore, the issue of Placement Shares to Mr Wood as contemplated by Resolution 2 requires shareholder approval under Listing Rule 10.11 before the Shares can be issued.

37. If approval is obtained pursuant to Listing Rule 10.11, KGL will be entitled to rely on Listing Rule 7.2, Exception 14 as an exception to any requirement that may otherwise apply requiring shareholder approval under Listing Rule 7.1.

38. Mr Wood (or entities controlled by him) has subscribed for 4,000,000 Shares under the Placement, which, subject to shareholder approval under Resolution 2, will be issued on or about 23 October 2017.