Dynasty Resources : Notice of Annual General Meeting&Proxy Form

31 October 2016

ASX Announcement

DESPATCH OF NOTICE OF MEETING AND PROXY FORM

In accordance with Listing Rule 3.17, Dynasty Resources Limited ('Company') advises that the Notice of Annual General Meeting and Proxy Form have been despatched to shareholders.

For those holders who have elected to receive a paper copy of the Company's 2016 Annual Report, this has also been despatched.

These documents are available on the Company's website at www.dynastyresources.com.au.

Enquiries:

Lewis Tay Managing Director

[phone]

Dynasty Resources Limited ABN 80 110 385 709 83 Brisbane Street, Perth 6000 Western Australia

T: [phone] F: [phone] E: [e-mail] www.dynastyresources.com.au

Notice of Annual General Meeting

DYNASTY RESOURCES LIMITED ACN 110 385 709

The 2016 Annual General Meeting of Dynasty Resources Limited (the Company) will be held at:

Date: Wednesday, 30 November 2016 Time: 11.00am (Sydney time)

Venue: BDO

Level 11, 1 Margaret St Sydney NSW

Ordinary Business

1. Financial Statements and Reports

   To receive and consider the Financial Report, Director's report and Auditor's report for the financial year ended 30 June 2016.

2. Remuneration Report

   To consider, and, if thought fit, pass the following non-binding ordinary resolution:

   "That the Remuneration Report for the year ended 30 June 2016 be adopted."

   The Remuneration Report commences on page 14 of the Annual Report.

3. Election of Directors

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

   "That Qingzhou Yuan, who retires in accordance with clause 13.2 of the Company's Constitution and, being eligible, is re-elected as a director of the Company."

4. Appointment of Auditor

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

   "That, for the purposes of the Corporations Act 2001 (Cth) and for all other purposes, BDO East Coast Partnership, having been nominated by a member and director and consented in writing to act in the capacity of auditor, be appointed as auditor of the company."

5. Approval of Placement Facility

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

"That for the purposes of ASX Listing Rule 7.1A and for all other purposes, approval is given for the issue of Equity securities of up to 10% of the issued share capital of the Company (at the time of issue) within the next 12 months calculated in accordance with the formula prescribed in Listing Rule 7.1A.2 and on the terms and conditions set out in the Explanatory Statement."

By order of the Board of Dynasty Resources Limited Louise Edwards

Company Secretary 31 October 2016

Explanatory Notes

These Explanatory Notes have been prepared to help shareholders understand the business to be put to shareholders at the forthcoming Annual General Meeting (AGM).

1. Financial Statements and Reports

   The financial reports and the reports of the Directors and of the auditor for the financial year ended 30 June 2016 will be laid before the AGM, as required by section 317 of the Corporations Act 2001 (Cth). The Corporations Act does not require a vote of shareholders on these reports.

   The Company's 2016 Annual Report (which includes the Directors', Auditor's and Financial Reports) is available on the Company's website www.dynastyresources.com.au.

   During this item of business, shareholders will be given a reasonable opportunity to ask questions about, and make comments on, those reports and the business and management of the Company.

   Shareholders will also be given a reasonable opportunity to ask a representative of the Company's auditor, BDO, questions relevant to the conduct of the audit, the preparation and the content of the Auditor's Report, the accounting policies adopted by the Company in relation to the preparation of financial statements or the independence of the auditor in relation to the conduct of the audit.

2. Remuneration Report

   The Corporations Act 2001 (Cth) requires that the section of the Director's Report dealing with the remuneration of Directors ("Remuneration Report") be put to a vote of Shareholders for adoption by way of a resolution. The Remuneration Report commences on page [ of the 2016 Annual Report.

   The Corporations Act 2001 (Cth) provides that the vote on the resolution is advisory only and will not bind the Directors or the Company, however the Board will take the outcome of the vote into consideration when reviewing the remuneration practices and policies.

   If more than 25% of the votes are cast against two consecutive annual section 250R(2) resolutions, the Corporations Act requires a shareholder vote on whether to convene a special meeting at which all directors (other than a managing director) who were in office when the second 250R(2) resolution was passed must stand for re-election.

   The Chair will give Shareholders a reasonable opportunity to ask questions about, or to make comments upon, the Remuneration Report before the resolution is put to the vote.

   A voting exclusion statement applies to this item of business, as set out on page 5.

   Board recommendation

   The Directors recommend that shareholders vote in favour of adopting the Remuneration Report.

3. Election of Directors

   The Company's Constitution requires one-third of the Directors (other than alternate Directors and the Managing Director) retire at the AGM (retirement by rotation). If eligible, the retiring Director may offer himself for re-election.

   Accordingly, Mr Qingzhou Yuan has agreed to retire by rotation as a Director of the Company at the AGM and, being eligible, offers himself for re-election.

   Information on the skills and experience for Mr Yuan is set out in the Company's 2016 Annual Report. Instructions on how to access a copy of that Report have been provided on page 5.

   Board recommendation

   The Board, excluding Qingzhou Yuan, recommends that shareholders vote in favour of the re-election of Mr Yuan.

4. Appointment of Auditor

   As announced by the Company to the ASX on 8 February 2016 BDO East Coast Partnership replaced Deloitte Touche Tohmatsu as the Company's auditors for the year ended 30 June 2016. ASIC has consented to the resignation in accordance with s329(5) of the Corporations Act 2001 (Cth).

   In accordance with s327C of the Corporations Act 2001 (Cth), BDO East Coast Partnership will continue to hold office until shareholders formally approve the new auditor appointment.

   Mr Lewis Tay, being a member of the Company, has nominated that BDO East Coast Partnership be appointed as the replacement auditor. In accordance with s328B(3) of the Corporations Act 2001 (Cth) is included at the end of these Explanatory Notes.

   Shareholders are being asked to approve the appointment of BDO East Coast Partnership as auditor effective from the Annual General Meeting.

   Board recommendation

   The Board recommends that shareholders vote in favour of this resolution.

5. Approval of Placement Facility

General

The Company is seeking shareholder approval in accordance with Listing Rule 7.1A to have the ability to issue up to 10% of its issued share capital through placements over a 12 month period after the AGM (10% Placement Facility). The 10% Placement Facility is in addition to the Company's existing 15% placement capacity under Listing Rule 7.1, and the effect of this Resolution will be to allow the Directors to issue the equity securities under Listing Rule 7.1A during the 10% Placement Period without using the Company's 15% placement capacity under Listing Rule 7.1.

The Company may use the funds raised from the issue of equity securities under the 10% Placement Facility to meet the costs to maintain its existing resource tenements and projects and/or the acquisition of new assets or investments.

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. As at the date of this Notice the Company only has one class of quoted equity securities, ordinary fully paid shares.

At the date of this Notice the Company has on issue 506,326,341 shares and therefore has a capacity to issue over the next 12 months:

1. 75,948,951 equity securities under Listing Rule 7.1; and

2. subject to Shareholder approval being given under this Resolution, an additional 50,632,634 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 and may be greater than the number set out in (ii) above if the Company makes an issue of equity securities in accordance with Listing Rule 7.2.

   Minimum Issue Price

   The issue price of equity securities issued under Listing Rule 7.1A must be not less than 75% of the volume weighted average price ('VWAP') of equity securities calculated over the 15 Trading Days on which trades in that class were recorded immediately before:

3. the date on which the price at which the equity securities are to be issued is agreed; or

4. if the equity securities are not issued within 5 Trading Days of the date in paragraph (i) above, the date on which the Equity securities are issued.

5. 10% Placement Period

   Shareholder approval of the 10% Placement Facility under Listing Rule 7.1A is valid from the date of the AGM and expires on the earlier to occur of:

6. the date that is 12 months after the date of the AGM at which the approval is obtained; or

7. 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).

   Dilution of Existing Shareholders

   If Resolution 4 is approved by Shareholders and the Company issues equity securities under the 10% Placement Facility, existing Shareholders' voting power in the Company will be diluted as shown in the table following. There is a risk that:

   • the market price for the Company's equity securities may be significantly lower on the date of the issue of the equity securities than on the date of the Meeting; and

   • the equity securities may be issued at a price that is at a discount to the market price for the Company's equity securities on the issue date or the equity securities are issued as part of consideration for the acquisition of a new asset,

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

     The table following shows the 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:

   • 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 scrip issued under a takeover offer) or future specific placements under Listing Rule 7.1 that are approved at a future Shareholders' meeting; and

     Variable 'A' in Listing Rule 7.1A.2	Dilution
     	50% decrease in Issue Price $0.026	Issue Price $0.052	100% increase in Issue Price $0.104
     Current Variable A 506,326,341 Shares	10% Voting Dilution	50,632,634 Shares
     	Funds Raised	$1,316,448	$2,632,897	$5,265,794
     50% increase in current Variable A 759,489,512 Shares	10% Voting Dilution	75,948,951 Shares
     	Funds Raised	$1,974,673	$3,949,345	$7,898,691
     100% increase in current Variable A 1,012,652,682 Shares	10% Voting Dilution	101,265,268 Shares
     	Funds Raised	$2,632,897	$5,265,794	$10,531,588

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

   The table has been prepared on the following assumptions:

   • The Company issues the maximum number of equity securities available under the 10% Placement Facility;

   • The 10% voting dilution reflects the aggregate percentage dilution against the issued share capital at the time of issue. This is why 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 under 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, not under the 15% placement capacity under Listing Rule 7.1;

   • The issue price is $0.052, being the closing price of the Securities on ASX on 24 October 2016.

     Purpose for Issue of Securities and Allocation Policy

     The Company may seek to issue the equity securities for the following purposes:

   • non-cash consideration for the acquisition of new resources assets and/or investments. In such circumstances the Company will provide a valuation of the non-cash consideration as required by Listing Rule 7.1A.3; or

   • cash consideration. In such circumstances, the Company intends to use the funds raised towards the exploration activities of its existing projects and/or for acquisition of new assets or investments (including expenses associated with such acquisition) and general working capital.

     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 will be determined on a case-by- case basis having regard to the factors including but not limited to the following:

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

   • the effect of the issue of the equity securities on the control of the Company;

   • the financial situation and solvency of the Company; and

   • 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.