Announcement PDF ESTRELLA RESOURCES LIMITED ACN 151 155 207 NOTICE OF ANNUAL GENERAL MEETING Notice is given that the Meeting will be held at: TIME: 1:00 pm (WST) DATE: Tuesday, 19 November 2019 PLACE: ”Mining Corporate Boardroom” Level 11 216 St Georges Terrace PERTH WA 6000 The business of the Meeting affects your shareholding and your vote is important. This Notice of Meeting should be read in its entirety. If Shareholders are in doubt as to how they should vote, they should seek advice from their professional advisers prior to voting. 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 Shareholders at 1:00 pm (WST) on Sunday 17 November 2019. BUSINESS OF THE MEETING AGENDA 1. FINANCIAL STATEMENTS AND REPORTS To receive and consider the annual financial report of the Company for the financial year ended 30 June 2019 together with the declaration of the directors, the director’s report, the Remuneration Report and the auditor’s report. 2. RESOLUTION 1 – ADOPTION OF REMUNERATION REPORT To consider and, if thought fit, to pass, with or without amendment, the following resolution as a non-binding resolution: “That, for the purposes of section 250R(2) of the Corporations Act and for all other purposes, approval is given for the adoption of the Remuneration Report as contained in the Company’s annual financial report for the financial year ended 30 June 2019.” Note: the vote on this Resolution is advisory only and does not bind the Directors or the Company. Voting Prohibition Statement: A vote on this Resolution must not be cast (in any capacity) by or on behalf of either of the following persons: (a) a member of the Key Management Personnel, details of whose remuneration are included in the Remuneration Report; or (b) a Closely Related Party of such a member. However, a person (the voter) described above may cast a vote on this Resolution as a proxy if the vote is not cast on behalf of a person described above and either: (a) the voter is appointed as a proxy by writing that specifies the way the proxy is to vote on this Resolution; or (b) the voter is the Chair and the appointment of the Chair as proxy: (i) does not specify the way the proxy is to vote on this Resolution; and (ii) expressly authorises the Chair to exercise the proxy even though this Resolution is connected directly or indirectly with the remuneration of a member of the Key Management Personnel. 3. RESOLUTION 2 – RE-ELECTION OF DIRECTOR – MR STEPHEN BROCKHURST To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution: “That, for the purpose of clause 15.3 of the Constitution, ASX Listing Rule 14.4 and for all other purposes, Mr Stephen Brockhurst, a Director, retires by rotation, and being eligible, is re-elected as a Director.” 4. RESOLUTION 3 – ELECTION OF DIRECTOR – MR LESLIE PEREIRA To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution: “That, for the purpose of clause 15.1 of the Constitution, ASX Listing Rule 14.4 and for all other purposes, Mr Leslie Pereira, a Director who was appointed casually on 1 February 2019, retires, and being eligible, is, is re-elected as a Director.” 4489-01/2271948_5 1 5. RESOLUTION 4 – RATIFICATION OF PRIOR ISSUE – SHARES AND OPTIONS To consider and, if thought fit, to pass, with or without amendment, 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 issue of 38,500,000 Shares and 50,019,231 Options on the terms and conditions set out in the Explanatory Statement.” Voting Exclusion: The Company will disregard any votes cast in favour of the Resolution by or on behalf of a person who participated in the issue or any associates of those persons. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form, or, it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides. 6. RESOLUTION 5 – RATIFICATION OF PRIOR ISSUE OF SHARES To consider and, if thought fit, to pass, with or without amendment, 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 issue of 3,464,505 Shares on the terms and conditions set out in the Explanatory Statement.” Voting Exclusion: The Company will disregard any votes cast in favour of the Resolution by or on behalf of a person who participated in the issue or any associates of those persons. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form, or, it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides. 7. RESOLUTION 6 – RATIFICATION OF PRIOR ISSUE OF SHARES To consider and, if thought fit, to pass, with or without amendment, 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 issue of 800,000 Shares on the terms and conditions set out in the Explanatory Statement.” Voting Exclusion: The Company will disregard any votes cast in favour of the Resolution by or on behalf of a person who participated in the issue or any associates of those persons. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form, or, it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides. 8. RESOLUTION 7 – ISSUE OF OPTIONS TO STEPHEN BROCKHURST To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution: “That for the purposes of sections 195(4) and 208 of the Corporations Act, ASX Listing Rule 10.14 and for all other purposes, approval is given for the Company to issue 3,000,000 Options to Stephen Brockhurst (or his nominee) on the terms and conditions set out in the Explanatory Statement.” 2 Voting Exclusion: The Company will disregard any votes cast in favour of the Resolution by or on behalf of Mr Brockhurst (or his nominee) or any of their associates (Resolution 7 Excluded Party). However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form, or, provided the Chair is not a Resolution 7 Excluded Party, it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides. Voting Prohibition Statement: A person appointed as a proxy must not vote, on the basis of that appointment, on this Resolution if: (a) the proxy is either: (i) a member of the Key Management Personnel; or (ii) a Closely Related Party of such a member; and (b) the appointment does not specify the way the proxy is to vote on this Resolution. Provided the Chair is not a Resolution 7 Excluded Party, the above prohibition does not apply if: (a) the proxy is the Chair; and (b) the appointment expressly authorises the Chair to exercise the proxy even though this Resolution is connected directly or indirectly with remuneration of a member of the Key Management Personnel. 9. RESOLUTION 8 – ISSUE OF OPTIONS TO LESLIE PEREIRA To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution: “That for the purposes of sections 195(4) and 208 of the Corporations Act, ASX Listing Rule 10.14 and for all other purposes, approval is given for the Company to issue 3,000,000 Options to Leslie Pereira (or his nominee) on the terms and conditions set out in the Explanatory Statement.” Voting Exclusion: The Company will disregard any votes cast in favour of the Resolution by or on behalf of Mr Pereira (or his nominee) or any of their associates (Resolution 8 Excluded Party). However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form, or, provided the Chair is not a Resolution 8 Excluded Party, it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides. Voting Prohibition Statement: A person appointed as a proxy must not vote, on the basis of that appointment, on this Resolution if: (a) the proxy is either: (i) a member of the Key Management Personnel; or (ii) a Closely Related Party of such a member; and (b) the appointment does not specify the way the proxy is to vote on this Resolution. Provided the Chair is not a Resolution 8 Excluded Party, the above prohibition does not apply if: (a) the proxy is the Chair; and (b) the appointment expressly authorises the Chair to exercise the proxy even though this Resolution is connected directly or indirectly with remuneration of a member of the Key Management Personnel. 10. RESOLUTION 9 – ISSUE OF OPTIONS TO JOHN KINGSWOOD To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution: “That for the purposes of sections 195(4) and 208 of the Corporations Act, ASX Listing Rule 10.14 and for all other purposes, approval is given for the 3 Company to issue 3,000,000 Options to John Kingswood (or his nominee) on the terms and conditions set out in the Explanatory Statement.” Voting Exclusion: The Company will disregard any votes cast in favour of the Resolution by or on behalf of Mr Kingswood (or his nominee) or any of their associates (Resolution 9 Excluded Party). However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form, or, provided the Chair is not a Resolution 9 Excluded Party, it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides. Voting Prohibition Statement: A person appointed as a proxy must not vote, on the basis of that appointment, on this Resolution if: (a) the proxy is either: (i) a member of the Key Management Personnel; or (ii) a Closely Related Party of such a member; and (b) the appointment does not specify the way the proxy is to vote on this Resolution. Provided the Chair is not a Resolution 9 Excluded Party, the above prohibition does not apply if: (a) the proxy is the Chair; and (b) the appointment expressly authorises the Chair to exercise the proxy even though this Resolution is connected directly or indirectly with remuneration of a member of the Key Management Personnel. 11. RESOLUTION 10 – APPOINTMENT OF AUDITOR To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution: “That, for the purposes of section 327B of the Corporations Act and for all other purposes, RSM Australia Partners, having been nominated and having consented in writing to act as auditor of the Company, be appointed as auditor of the Company with effect from the close of the Meeting.” 12. RESOLUTION 11 – APPROVAL OF 10% PLACEMENT CAPACITY To consider and, if thought fit, to pass the following resolution as a special resolution: “That, for the purposes of Listing Rule 7.1A and for all other purposes, approval is given for the Company to issue up to that number of Equity Securities equal to 10% of the issued capital of the Company at the time of issue, calculated in accordance with the formula prescribed in ASX Listing Rule 7.1A.2 and otherwise on the terms and conditions set out in the Explanatory Statement.” Voting Exclusion: The Company will disregard any votes cast in favour of the Resolution by or on behalf of a person who is expected to participate in, or who will obtain a material benefit as a result of, the proposed issue (except a benefit solely by reason of being a holder of ordinary securities in the Company) or an associate of that person (or those persons). However, the Company will not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form, or, it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides. 13. RESOLUTION 12 – REPLACEMENT OF CONSTITUTION To consider and, if thought fit, to pass the following resolution as a special resolution: 4 “That, for the purposes of section 136(2) of the Corporations Act and for all other purposes, approval is given for the Company to repeal its existing Constitution and adopt a new constitution in its place in the form as signed by the chairman of the Meeting for identification purposes.” Dated: 14 October 2019 By order of the Board David McEntaggart Company Secretary 5 Voting in person To vote in person, attend the Meeting at the time, date and place set out above. Voting by proxy To vote by proxy, please complete and sign the enclosed Proxy Form and return by the time and in accordance with the instructions set out on the Proxy Form. In accordance with section 249L of the Corporations Act, Shareholders are advised that:  each Shareholder has a right to appoint a proxy;  the proxy need not be a Shareholder of the Company; and  a Shareholder who is entitled to cast 2 or more votes may appoint 2 proxies and may specify the proportion or number of votes each proxy is appointed to exercise. If the member appoints 2 proxies and the appointment does not specify the proportion or number of the member’s votes, then in accordance with section 249X(3) of the Corporations Act, each proxy may exercise one-half of the votes. Shareholders and their proxies should be aware that changes to the Corporations Act made in 2011 mean that:  if proxy holders vote, they must cast all directed proxies as directed; and  any directed proxies which are not voted will automatically default to the Chair, who must vote the proxies as directed. Should you wish to discuss the matters in this Notice of Meeting please do not hesitate to contact the Company Secretary on +61 8 9481 0389. 6 EXPLANATORY STATEMENT This Explanatory Statement has been prepared to provide information which the Directors believe to be material to Shareholders in deciding whether or not to pass the Resolutions. 1. FINANCIAL STATEMENTS AND REPORTS In accordance with the Constitution, the business of the Meeting will include receipt and consideration of the annual financial report of the Company for the financial year ended 30 June 2019 together with the declaration of the directors, the directors’ report, the Remuneration Report and the auditor’s report. The Company will not provide a hard copy of the Company’s annual financial report to Shareholders unless specifically requested to do so. The Company’s annual financial report is available on its website at www.estrellaresources.com.au. 2. RESOLUTION 1 – ADOPTION OF REMUNERATION REPORT 2.1 General The Corporations Act requires that at a listed company’s annual general meeting, a resolution that the remuneration report be adopted must be put to the shareholders. However, such a resolution is advisory only and does not bind the company or the directors of the company. The remuneration report sets out the company’s remuneration arrangements for the directors and senior management of the company. The remuneration report is part of the directors’ report contained in the annual financial report of the company for a financial year. The chair of the meeting must allow a reasonable opportunity for its shareholders to ask questions about or make comments on the remuneration report at the annual general meeting. 2.2 Voting consequences A company is required to put to its shareholders a resolution proposing the calling of another meeting of shareholders to consider the appointment of directors of the company (Spill Resolution) if, at consecutive annual general meetings, at least 25% of the votes cast on a remuneration report resolution are voted against adoption of the remuneration report and at the first of those annual general meetings a Spill Resolution was not put to vote. If required, the Spill Resolution must be put to vote at the second of those annual general meetings. If more than 50% of votes cast are in favour of the Spill Resolution, the company must convene a shareholder meeting (Spill Meeting) within 90 days of the second annual general meeting. All of the directors of the company who were in office when the directors' report (as included in the company’s annual financial report for the most recent financial year) was approved, other than the managing director of the company, will cease to hold office immediately before the end of the Spill Meeting but may stand for re-election at the Spill Meeting. Following the Spill Meeting those persons whose election or re-election as directors of the company is approved will be the directors of the company. 4489-01/2271948_5 7 2.3 Previous voting results At the Company’s previous annual general meeting the votes cast against the remuneration report considered at that annual general meeting were less than 25%. Accordingly, the Spill Resolution is not relevant for this Annual General Meeting. 3. RESOLUTION 2 – RE-ELECTION OF DIRECTOR – MR STEPHEN BROCKHURST 3.1 General The Constitution sets out the requirements for determining which Directors are to retire by rotation at an annual general meeting. Mr Stephen Brockhurst, who has served as a director since 3 April 2017, retires by rotation and seeks re-election. 3.2 Qualifications and other material directorships Mr Brockhurst is the founding Director of Mining Corporate Pty Ltd and has 15 years’ experience in the finance and corporate advisory industry and has been responsible for the preparation of the due diligence process and prospectuses on a number of initial public offers. His experience includes corporate and capital structuring, corporate advisory and company secretarial services, capital raising, ASX and ASIC compliance requirements. Mr Brockhurst has served on the board and acted as Company Secretary for numerous ASX listed and private companies. He is currently a Director of Kingwest Resources Limited and Nelson Resources Limited. 3.3 Independence If elected the board consider Mr Brockhurst will be an independent director. 3.4 Board recommendation The Board supports the re-election of Mr Stephen Brockhurst and recommends that Shareholders vote in favour of Resolution 2. 4. RESOLUTION 3 – ELECTION OF DIRECTOR – MR LESLIE PEREIRA 4.1 General The Constitution allows the Directors to appoint at any time a person to be a Director either to fill a casual vacancy or as an addition to the existing Directors, but only where the total number of Directors does not at any time exceed the maximum number specified by the Constitution. Pursuant to the Constitution and ASX Listing Rule 14.4, any Director so appointed holds office only until the next following annual general meeting and is then eligible for election by Shareholders but shall not be taken into account in determining the Directors who are to retire by rotation (if any) at that meeting. Mr Leslie Pereira, having been appointed by other Directors on 1 February 2019 in accordance with the Constitution, will retire in accordance with the Constitution and ASX Listing Rule 14.4 and being eligible, seeks election from Shareholders. 8 4.2 Qualifications and other material directorships Mr Pereira is a WA based businessman and investor in the resources sector. Mr Pereira has previously held senior management positions overseeing active mining operations in Indonesia. He has been actively involved in capital raisings and promotions of a number of publicly listed companies. Mr Pereira is not currently and has not been within the last three years a director of any publicly listed companies. 4.3 Independence Mr Pereira has no interests, position, association or relationship that might influence, or reasonably be perceived to influence, in a material respect his capacity to bring an independent judgement to bear on issues before the board and to act in the best interest of the entity and its security holders generally. If elected the board considers Mr Pereira will be an independent director. 4.4 Board recommendation The Board supports the re-election of Mr Leslie Pereira and recommends that Shareholders vote in favour of Resolution 3. 5. RESOLUTIONS 4 TO 6 – RATIFICATION OF PRIOR ISSUE OF SHARES AND OPTIONS 5.1 General On 27 March 2019, the Company issued 38,500,000 Shares at an issue price of $0.013 per Share and 19,250,000 Options, being one free attaching listed Option for every two Shares subscribed for on the terms and conditions set out in Schedule 2 as part of a placement to sophisticated investors (Placement). The Company also issued 30,769,231 listed option to the lead manager of the Placement for nil consideration (Lead Manager Options). On 16 August 2019 and 20 August 2019, the Company issued 3,464,505 and 800,000 Shares respectively to drilling suppliers in lieu of services provided, at a deemed issue price of $0.01 per share (Supplier Shares). Resolutions 4 to 6 seek Shareholder ratification pursuant to ASX Listing Rule 7.4 for the issue of those Placement Shares and free-attaching Options, , Lead Manager Options and Supplier Shares (Ratification). ASX Listing Rule 7.1 provides that a company must not, subject to specified exceptions, issue or agree to issue more equity securities during any 12 month period than that amount which represents 15% of the number of fully paid ordinary securities on issue at the commencement of that 12 month period. ASX Listing Rule 7.4 sets out an exception to ASX Listing Rule 7.1. It provides that where a company in general meeting ratifies the previous issue of securities made pursuant to ASX Listing Rule 7.1 (and provided that the previous issue did not breach ASX Listing Rule 7.1) those securities will be deemed to have been made with shareholder approval for the purpose of ASX Listing Rule 7.1. By ratifying this issue, the Company will retain the flexibility to issue equity securities in the future up to the 15% annual placement capacity set out in ASX Listing Rule 7.1 without the requirement to obtain prior Shareholder approval. 9 5.2 Technical information required by ASX Listing Rule 7.5 Pursuant to and in accordance with ASX Listing Rule 7.5, the following information is provided in relation to the Ratification: (a) 42,764,505 Shares and 50,019,231 Options were issued; (b) the issue price of the Placement Shares was $0.013 per Share and the Placement Options were issued at a price of nil as they were free attaching ; (c) The Lead Manager Options were issued in lieu of services provided for nil cash consideration with a fair value of $61,538; (d) The Supplier Shares were issued in lieu of services provided for nil cash consideration at a deemed value of $0.01 with a fair value of $42,645; (e) the Placement Shares and Supplier Shares issued were all fully paid ordinary shares in the capital of the Company issued on the same terms and conditions as the Company’s existing Shares; (f) the Options are quoted and have an exercise price of $0.05 and expiry date of 27 June 2021 (ASX: ESRO) and were otherwise issued on the terms and conditions set out in Schedule 2; (g) the Placement Shares and Options were issued to sophisticated investors, who were not related parties of the Company; (h) The Lead Manager Options were issued to GTT Ventures Pty Ltd; (i) The Supplier Shares were issued to suppliers of the Company who were not related parties of the Company; and (j) funds raised from the Placement were used to progress exploration activities at the Company’s Carr Boyd Nickel and Spargoville Projects. There were no funds raised for the issue of the Lead Manager Options or Supplier Shares. 6. RESOLUTIONS 7 TO 9 – ISSUE OF OPTIONS TO RELATED PARTIES 6.1 General The Company has agreed, subject to obtaining Shareholder approval, to issue a total of 9,000,000 Options (Related Party Options) to Messrs Brockhurst, Pereira and Kingswood (Related Parties) pursuant to the ESOP and otherwise on the terms and conditions set out below. For a public company, or an entity that the public company controls, to give a financial benefit to a related party of the public company, the public company or entity must: (a) obtain the approval of the public company’s members in the manner set out in sections 217 to 227 of the Corporations Act; and (b) give the benefit within 15 months following such approval, unless the giving of the financial benefit falls within an exception set out in sections 210 to 216 of the Corporations Act. 10 The grant of the Related Party Options constitutes giving a financial benefit and Messrs Brockhurst, Pereira and Kingswood are related parties of the Company by virtue of being Directors. In addition, ASX Listing Rule 10.14 also requires shareholder approval to be obtained where an entity issues, or agrees to issue, securities under an employee incentive scheme to a director of the entity, an associate of the director, or a person whose relationship with the entity, director or associate of the director is, in ASX’s opinion, such that approval should be obtained. It is the view of the Company that the exceptions set out in sections 210 to 216 of the Corporations Act and ASX Listing Rule 10.12 do not apply in the current circumstances. Accordingly, Shareholder approval is sought for the grant of Related Party Options to the Related Parties. 6.2 Shareholder Approval (Chapter 2E of the Corporations Act and Listing Rule 10.11) Pursuant to and in accordance with the requirements of section 219 of the Corporations Act and ASX Listing Rule 10.13, the following information is provided in relation to the proposed grant of Related Party Options: (a) the related parties are Messrs Brockhurst, Pereira and Kingswood and they are related parties by virtue of being Directors; (b) the maximum number of Related Party Options (being the nature of the financial benefit being provided) to be granted to the Related Parties is: (i) 3,000,000 Related Party Options to Steve Brockhurst; (ii) 3,000,000 Related Party Options to Les Pereira; and (iii) 3,000,000 Related Party Options to John Kingswood; (c) the Related Party Options will be granted to the Related Parties no later than 1 month after the date of the Meeting (or such later date as permitted by any ASX waiver or modification of the ASX Listing Rules) and it is anticipated the Related Party Options will be issued on one date; (d) the Related Party Options will be granted for nil cash consideration; accordingly, no funds will be raised; (e) the Related Party Options will be issued pursuant to the ESOP and on the terms and conditions as set out in Schedule 2; (f) the ESOP was adopted by Shareholders on 26 April 2018. 5,500,000Options have previously been issued under the ESOP; (g) any full or part time employee or Director is entitled to participate in the Option Plan, however, at the current time the Company does not intend to make an offer to any other employees. Accordingly, approval is being sought only for the offer to the Related Parties; (h) no loan will be provided to the Related Parties with respect to the Related Party Options; (i) the value of the Related Party Options and the pricing methodology is set out in Schedule 3; 11 (j) (k) the relevant interests of the Related Parties in securities of the Company are set out below not including the Related Party Options: Related Party Shares Options Steve Brockhurst 750,000 1,750,001 Les Pereira 300,000 4,995,769 John Kingswood 1,410,000 1,970,000 the remuneration and emoluments from the Company to the Related Parties for the previous financial year and the proposed remuneration and emoluments for the current financial year are set out below: Related Party Current Financial Year Previous Financial Year Stephen Brockhurst $136,000* $142,019 Les Pereira $40,000 $16,667 John Kingswood $40,000 $40,000 *Includes amounts paid to Mining Corporate Pty Ltd for 2019 FY or expected to be paid for 2020 FY, a company of which Mr Brockhurst is a director, for Company Secretarial, Accounting and Bookkeeping services. (l) if the Related Party Options granted to the Related Parties are exercised, a total of 9,000,000 Shares would be issued. This will increase the number of Shares on issue from 534,647,797 to 543,647,797 (assuming that no other Options are exercised and no other Shares are issued other than those contemplated by this Notice) with the effect that the shareholding of existing Shareholders would be diluted by an aggregate of 1.68%, comprising 0.56% by each Director. The market price for Shares during the term of the Related Party Options would normally determine whether or not the Related Party Options are exercised. If, at any time any of the Related Party Options are exercised and the Shares are trading on ASX at a price that is higher than the exercise price of the Relate