for personal use only - asx · warner, jonathan pager and michael pollak as the directors;...

FRR Corporation Limited (formerly Frigrite Limited)

ACN 112 452 436

Annual Financial Report for the year ended 30 June 2012

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F R R C o r p o r a t i o n L i m i t e d ( f o r m e r l y F r i g r i t e L i m i t e d )

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CORPORATE DIRECTORY

Directors Hugh Warner – Non-executive Director & Chairperson Jonathan Pager – Non-executive Director Michael Pollak – Non-executive Director

Company Secretary Andrew Whitten

Auditors Stantons International Level 2 1 Walker Avenue West Perth WA 6005

Solicitors Whittens Lawyers and Consultants Level 5 137 – 139 Bathurst Street Sydney NSW 2000

Bankers Westpac Banking Corporation 109 St George’s Terrace Perth WA 6000

Registered Office Suite 6 245 Churchill Ave Subiaco WA 6008 Telephone: +61 8 9217 3300 Facsimile: +61 8 9388 3006

Share Registry Link Market Services Limited Ground Floor, 178 St Georges Terrace PERTH WA 6000 Investor Enquiries: 1300 554 474 Facsimile: +61 2 9287 0303

Stock Exchange Listing Securities of FRR Corporation Limited are listed on the Australian Securities Exchange (ASX). ASX Code: FRR Web Site: www.frr.com.au

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FINANCIAL REPORT

Contents

Directors’ report 3

Corporate governance statement 9

Statement of financial position 14

Statement of comprehensive income 15

Statement of changes in equity 16

Statement of cash flows 17

Notes to the financial statements 18

Directors’ declaration 39

Independent auditor’s report 40

Auditor’s Independence declaration 42

ASX Additional Information 43

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Directors’ report Your directors submit the financial report of FRR Corporation Limited (‘Company’ or ‘FRR’) for the year ended 30 June 2012.

Officers and Directors The names and particulars of the Directors of the Company during or since the end of the financial year are:

Name Particulars Mr Hugh D. Warner Non Executive Director and Chairperson (Appointed 28 November 2011) Mr. Jonathan G. Pager Non Executive Director(Appointed 28 November 2011) Mr. Michael B. Pollak Non Executive Director(Appointed 28 November 2011) David Hoff (Resigned 29 November 2011) Peter Vidler (Resigned 29 November 2011) Jury Wowk (Resigned 29 November 2011)

The above named Directors held office during and since the financial year, except as otherwise indicated. Incomplete records The management and affairs of the Company were not under the control of the Directors from the date the Company entered voluntary administration on 16 June 2011 until the date the Deed of Company Arrangement (“DoCA”) effectuated, being 28 February 2012. Additionally, the Company’s subsidiaries, Frigrite Refrigeration Pty Ltd and Frigrite Refrigeration (QLD) Pty Ltd entered voluntary administration on 18 January 2011 and entered liquidation on 23 February 2011 and 18 April 2011 respectively. The financial report was prepared by Directors who were not in office at the time the Company entered voluntary administration or for the full periods presented in this report. The Directors who prepared this financial report were appointed on 28 November 2011 as part of the recapitalisation proposal approved by the Company’s creditors and shareholders.

As a result, the financial information relating to the 30 June 2012 financial report was not subject to the same accounting and internal controls processes, which includes the implementation and maintenance of internal controls, that are relevant to the preparation and fair presentation of the financial report. Furthermore, it has not been possible for the Directors to obtain all of the books and records of the Company for the period up to 28 February 2012, being the date that the DoCA effectuated and control of the Company was passed over to the Directors. Whilst the books and records of the Company have been reconstructed to the maximum extent possible, the Directors are unable to satisfy themselves as to the completeness of the general ledger and financial records as well as the relevant disclosures in the financial report for the year ended 30 June 2012.

Consequently, the Directors are of the opinion that it is not possible to state that this financial report has been prepared in accordance with Australian Accounting Standards including Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001, because of the possible effect of this matter on the current year’s figures and the corresponding prior year figures.

Principal activities The principal activities of the Company during the financial year was designing, supplying, servicing and maintaining commercial refrigeration and air conditioning.

Review of operations and results The Company was suspended from trading on the ASX on 17 December 2010 at its request. On 18 January 2011, Frigrite Refrigeration Pty Ltd and Frigrite Refrigeration (QLD) Pty Ltd were both placed into voluntary administration. Subsequently, Frigrite Refrigeration Pty Ltd was placed into liquidation on 23 February 2011, and Frigrite Refrigeration (QLD) Pty Ltd was placed into liquidation on 18 April 2011. On 16 June 2011, Manfred Holzman of Holzman Associates was appointed administrator of the Company and assumed control of the Company and its business, property and affairs. On 10 August 2011, the creditors of the Company approved the Administrators entering into a Deed of Company Arrangement (DoCA) to investigate the restructure of the Company’s capital. On 10 February 2012, shareholders approved a proposal for the restructure and recapitalisation of the Company which resulted in the syndicate behind the proposal paying $513,000 to the Deed Administrator for distribution under the DoCA via the Creditors’ Trust plus 45,000,000 Secured Creditor Consideration Shares issued to the Noteholders in return for secured and unsecured creditors releasing all claims against the Company and their charge over the Company. This occurred on the 28 February 2012, when the DoCA was fully effectuated and the Frigrite Limited’s Creditors Trust was established, and the Company’s subsidiaries, Frigrite Refrigeration Pty Ltd and Frigrite Refrigeration (QLD) Pty Ltd, were retained by the Creditors Trust and were deconsolidated from the Frigrite Group.

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Directors’ report (continued)

Review of operations and results (continued) As a result of the recapitalisation and restructuring, the Company has:

retained its existing business assets (unencumbered); entered into a Creditors’ Trust Deed to satisfy approved creditor claims; arranged a payment $513,000 to the Deed Administrator for the purposes of satisfying creditors’ claims under the

Creditors’ Trust Deed, with all other liabilities and obligations of the Company being compromised under the DoCA; de-consolidated Frigrite Refrigeration Pty Ltd and Frigrite Refrigeration (QLD) Pty Ltd from the Group upon transfer to

the Creditors’ Trust; consolidated the issued capital of the Company on the basis that every six (6) Shares have been consolidated into one (1)

Share; and every six (6) Options have been consolidated into one (1) Option. completed a capital raising to raise a total of $1,801,500; appointed new Directors Messrs Michael Pollak, Jonathan Pager and Hugh Warner to the Board; changed its name from Frigrite Limited to FRR Corporation Limited, recommenced trading on the ASX on 6 June 2012.

The profit after income tax for the financial year was $28,465,238 (2011: loss $75,093,000), due to primarily a gain arising from the settlement of all liabilities and obligations of the Company as a result of the effectuation of the DoCA and the creation of the Creditors’ Trust Deed.

Significant changes in the state of affairs Significant changes in the state of affairs of the Company during the financial year were as follows:

1. At a general meeting held on 10 February 2012, the shareholders of the Company resolved to: consolidate the capital on a 1:6 basis; change the name of the company to “FRR Corporation Limited”; adopt a new Constitution; re-elect Hugh Warner, Jonathan Pager and Michael Pollak as the directors; authorise the issue of 45,000,000 secured creditor consideration shares at 1 cent to Noteholders, authorise the placement of 120,000,000 shares at 0.25 cents per share (Share Placement Offer); authorise a share offer of 150,000,000 shares at 1 cent per share (Share Offer), authorise an offer of 60,000,000 options at 0.0025 cents per option (Options Offer); and authorise allotments and issues to the directors from the placement and issues;

2. With the satisfaction of all conditions and obligations of the parties, the DOCA was effectuated on 28 February 2012 and the Company was released from being subject to the DOCA. The Company’s subsidiaries, Frigrite Refrigeration Pty Ltd and Frigrite Refrigeration (QLD) Pty Ltd, were transferred to the Creditors’ Trust and were de-consolidated from the Group;

3. The Share Placement Offer, Share Offer and Options Offer were made in the Prospectus dated 12 April 2012 ;

4. The Share Placement Offer, Share Offer and Options Offer were fully subscribed The securities pursuant to the Share Placement Offer, Share Offer and Options Offer were allotted and issued on 4 May 2012. The material terms of the options is set out in Note 19(c); and

5. The Company was reinstated to the ASX Official List on 6 June 2012.

Environmental regulation and performance There are no applicable environmental regulations that would have an effect on the Company.

Dividends No dividends have been paid or declared since the beginning of the financial year and none are recommended.

Significant events after balance sheet date On the 6 July 2012, the Company announced it had entered into a Share Sale Agreement to acquire 100% of Minpac Properties Pty Ltd (“Minpac”) and its subsidiaries, in consideration for the issue of approximately 328,689,375 shares and 60,000,000 options exercisable at 1 cent per share. Minpac supplies custom configured, transportable, semi-permanent and permanent camp solutions to the mining and other remote location industries. In parallel with the acquisition, the Company has also entered into a joint venture with Minpac in relation to the air-conditioning and refrigeration components of the camps. The Company has provided joint venture funding to Minpac in the amount of $871,750 secured by a General Security Agreement. The Company is entitled to a margin equivalent to 7% of the joint venture advance.

On 9 August 2012, the Company issued a prospectus (supplementary prospectus lodged 21 August 2012) to issue up to 60,000,000 new ordinary shares at $0.01 to raise $600,000. The Company issued and allotted 49,000,000 first placement shares on 23 August 2012, with 11,000,000 second placement shares to be issued and allotted upon obtaining shareholder approval.

Likely developments and expected results of operations Disclosure of information regarding likely developments in the operations of the Company in future financial years and the expected results of those operations is likely to result in unreasonable prejudice to the Company. Accordingly, this information has not been disclosed in this report.

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Directors’ report (continued)

Information on Directors

Hugh Warner (Non-executive Director and Chairperson, age 43)

Experience and Expertise Mr Warner holds a Bachelor of Economics from the University of Western Australia. He has broad experience as a public company director, having been a director of a number of publicly listed companies involved in the mining, oil and gas, biotechnology and service industries.

Other Current Directorships Modun Resources Limited (Non-executive director and Chairperson) TPL Corporation Limited (Non-executive director and Chairperson) PLD Corporation Limited (Non-executive director and Chairperson) Prospect Resources Limited (Non-executive director and Chairperson)

Former Directorships in the Last Three Years None

Special Responsibilities Chairperson

Interests in Shares and Options 53,277,778 ordinary shares and 16,000,000 options Jonathan Pager (Non-executive director, age 42)

Experience and Expertise Mr Pager has over 18 years’ experience as a management consultant across a wide range of industries in Australia and overseas. He has a Masters of Economics and qualified as a chartered accountant with Deloitte, where he commenced his career. Jonathan has recapitalised several ASX-listed companies.

Other Current Directorships PLD Corporation Limited (Non-executive director) Prospect Resources Limited (Non-executive director)

Former Directorships in the Last Three Years TPL Corporation Limited (Resigned 15 June 2010)

Special Responsibilities None

Interests in Shares and Options 13,200,000 ordinary shares and 8,666,667 options Michael Pollak (Non-executive director, age 37)

Experience and Expertise Mr Pollak holds a Bachelor of Commerce, is a chartered accountant and has an MBA in strategy from the Australian Graduate School of Management. Michael commenced his career at PricewaterhouseCoopers 15 years ago. Michael has gained valuable experience in Sydney and London in general management, audit, insolvency, corporate advisory and strategy across a wide range of industries, including mining, financial services and manufacturing. Michael has been involved in the recapitalisation of a number of ASX-listed companies.

Other Current Directorships PLD Corporation Limited (Non-executive director) Prospect Resources Limited (Non-executive director)

Former Directorships in the Last Three Years None

Special Responsibilities None

Interests in Shares and Options 24,000,000 ordinary shares and 10,000,000 options

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Directors’ report (continued) Company secretary

The company secretary is Andrew Whitten. Andrew was appointed to the position of company secretary on 10 April 2012.

Directors’ meetings The Company was in Administration and DoCA from 16 June 2011 to 28 February 2012. Information on the attendance at Directors’ meetings is not available during this period. Subsequent 28 February 2012, there were no directors meetings, with business conducted via circular resolution.

Remuneration Report (audited) The Remuneration Report is set out under the following main headings:

1. Principles used to determine the nature and amount of remuneration; 2. Details of remuneration; 3. Service agreements; and 4. Share-based compensation.

The information provided under headings 1 to 4 below in the Remuneration Report has been audited as required by Section 308(3C) of the Corporations Act 2001. 1 Principles used to determine the nature and amount of remuneration (audited) The Company’s Constitution specifies that subject to the initial fixed annual aggregate sum of $500,000, the aggregate remuneration of non-executive directors shall not exceed the sum determined by the shareholders of the Company in general meeting. Fees and payments to directors:

1 are to reflect the demands which are made on, and the responsibilities of, the directors; and 2 are reviewed annually by the board to ensure that directors’ fees and payments are appropriate and in line with the

market.

Retirement allowances and benefits for directors

There are no retirement allowances or other benefits paid to directors. Directors’ fees

The amount of remuneration of the directors of the Company (as defined in AASB 124 Related Party Disclosures) is set out in the following table. During the financial year there were no executives other than the directors. There was no remuneration of any type paid to the directors, other than as reported below for the provision of director and professional services.

2 Details of remuneration (audited)

Name of director

Short term benefits

Salary & fees Non-monetary

Benefits

Post Employment Benefits -

Superannuation Share based

payments Total

Non-executive directors Hugh Warner (a) 32,110 - 2,890 - 35,000 Jonathan Pager (a)(b) 35,000 - - - 35,000 Michael Pollak (a) 32,110 - 2,890 - 35,000

Totals 99,220 - 5,780 - 105,000

(a) Messers Warner, Pollak and Pager did not receive any remuneration for the year ended 30 June 2011. (b) Pager Partners Corporate Advisory Pty Ltd, an entity associated with Jonathan Pager, was paid $35,000 for director’s

fees.

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Directors’ report (continued) Remuneration Report (audited) (continued)

3 Service agreements (audited) The non-executive directors serve until they resign, are removed, cease to be a director or are prohibited from being a director under the provisions of the Corporations Law 2001, or are not re-elected to office. The non-executive directors are remunerated on a monthly basis with three months termination payments payable. As at the date of this report there are no executives or management personnel engaged by the Company other than the directors.

4 Share-based compensation (audited)

There were no share-based or option based compensation paid to the directors during the financial year. (End of Remuneration Report) Additional Information (a) Shares under options As at the date of signing this report, there were 66,791,679 unissued ordinary shares under options (30 June 2011: 40,750,000). Refer to note 19 for further details of the options outstanding. (b) Insurance of officers Due to the Company entering administration on the 16 June 2011, the Directors D & O insurance premium was consequently not renewed. Subsequent to 30 June 2012, the Company obtained Directors D & O insurance. The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may be brought against the officers in their capacity as officers of the Company and any other payments arising from liabilities incurred by the officers in connection with such proceedings. This does not include such liabilities that arise from conduct involving a willful breach of duty by the officers or the improper use by the officers of their position or of information to gain advantage for them or someone else or to cause detriment to the Company.

(c) Agreement to indemnify officers

The Company has entered into agreements with the directors to provide access to Company records and to indemnify them. The indemnity relates to any liability as a result of being, or acting in their capacity as, an officer of the Company to the maximum extent permitted by law; and for legal costs incurred in successfully defending civil or criminal proceedings. No liability has arisen under these indemnities as at the date of this report. (d) Proceedings on behalf of the company

No person has applied to the court under Section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the Company, or to intervene in any proceedings to which the Company is a party, for the purpose of taking responsibility on behalf of the Company for all or part of those proceedings. No proceedings have been brought or intervened in on behalf of the Company with leave of the court under Section 237. (e) Auditor Stantons International are the appointed auditors. (f) Indemnity of Auditor The auditor (Stantons International) has not been indemnified under any circumstance.

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Directors’ report (continued) (g) Audit services During the financial year $17,000 (excluding GST) was paid or is payable for audit services provided by Stantons International (2011: $5,000 excluding GST). (h) Non-audit services Prior to Stantons International being appointed auditor on 11 May 2012, an entity associated with Stantons International provided the following non-audit services: Fees Paid (excl GST) $

Independent expert report accompanying the notice to the shareholders of the general meeting held on 10 February 2012

8,025

Total 8,025

The board of directors consider that there was no independence issue in the provision of these services. Auditor’s independence declaration The auditor’s independence declaration is included on page 42 of the annual report. Signed in accordance with a resolution of the directors.

Hugh Warner Director Perth 5 September 2012

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FRR CORPORATION LIMITED (FRR) – CORPORATE GOVERNANCE STATEMENT

This Corporate Governance Statement sets out FRR Corporation Limited’s (the Company) current compliance with the ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations (the ASX Principles and Recommendations). The ASX Principles and Recommendations are not mandatory. However, the Company will be required to provide a statement in its future annual reports disclosing the extent to which the Company has followed the ASX Principles and Recommendations. ASX Principles and Recommendations Comply

(Yes/No) Explanation

1. Lay solid foundations for management and oversight 1.1. Companies should establish the functions reserved

to the board and those delegated to senior executives and disclose those functions.

Yes The Company’s board of directors (the Board) is responsible for corporate governance of the Company. The Board develops strategies for the Company, reviews strategic objectives and monitors performance against those objectives. The goals of the corporate governance processes are to:

(a) maintain and increase Shareholder value; (b) ensure a prudential and ethical basis for the

Company’s conduct and activities; and (c) ensure compliance with the Company’s legal and

regulatory objectives. Consistent with these goals, the Board assumes the following responsibilities:

(a) developing initiatives for profit and asset growth; (b) reviewing the corporate, commercial and

financial performance of the Company on a regular basis;

(c) acting on behalf of, and being accountable to, the Shareholders; and

(d) identifying business risks and implementing actions to manage those risks and corporate systems to assure quality.

The Company is committed to the circulation of relevant materials to Directors in a timely manner to facilitate Directors’ participation in Board discussions on a fully-informed basis. It is expected that the division of responsibility of the Board and senior executives will vary with the evolution of the Company. The Company intends to regularly review the balance of responsibilities to ensure that the division of functions remains appropriate to the needs of the Company.

1.2. Companies should disclose the process for evaluating the performance of senior executives.

No Given the current size of the Company and the fact that the Company currently has no senior executives, the process for evaluating their performance is not relevant.

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ASX Principles and Recommendations Comply (Yes/No)

Explanation

2. Structure the board to add value 2.1. A majority of the board should be independent

directors. No The Board has reviewed the position and associations of

each of the three directors in office and has determined that none of the directors are independent. In making this determination the Board has had regard to the independence criteria in ASX Principle 2 and other facts, information and circumstances that the Board considers relevant. The Board assesses the independence of new directors upon appointment and reviews their independence, and the independence of the other directors, as appropriate. The Board strives to ensure that it is comprised of directors with a blend of skills, experience and attributes appropriate to the Company and its business. The principle criterion for the appointment of new directors is their ability to add value to the Company and its business.

2.2. The chair should be an independent director. No

The Company’s current Chairman Mr Hugh Warner, does not satisfy the ASX Principles and Recommendations definition of an independent director. However, the Board considers Mr Warner’s role as chairman essential to the success of the Company at this early stage of its restructure and the development of its new business.

2.3. The roles of chair and chief executive officer should not be exercised by the same individual.

N/A The Company has not yet appointed a chief executive officer.

2.4. The board should establish a nomination committee.

No No formal nomination committee or procedures have been adopted for the identification, appointment and review of the Board membership, but an informal assessment process, facilitated by the Chairman in consultation with the Company’s professional advisers (if required), has been committed to by the Board.

2.5. Companies should disclose the process for evaluating the performance of the board, its committees and individual directors.

No The Company does not have in place a separately constituted remuneration committee due to the size and current operations of the Company. The remuneration of an executive director will be decided by the Board, without the affected executive director participating in that decision-making process. There are currently no executive directors. The total maximum remuneration of non-executive directors is currently set at $500,000. Any increases will be the subject of a shareholder resolution in accordance with clause 13.7 of the Company’s constitution, the Corporations Act and the ASX Listing Rules, as applicable. The determination of non-executive directors’ remuneration within that maximum amount will be made by the Board, having regard to the inputs and value to the Company of the respective contributions by each non-executive director. The Board may award additional remuneration to non-executive directors called upon to perform extra services or make special exertions on behalf of the Company.

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Explanation

3. Promote ethical and responsible decision-making3.1. Companies should establish a code of conduct and

disclose the code or a summary of the code as to: the practices necessary to maintain confidence in

the company’s integrity; the practices necessary to take into account their

legal obligations and the reasonable expectations of their stakeholders;

the responsibility and accountability of individuals for reporting and investigating reports of unethical practices.

No The Board is committed to the establishment and maintenance of appropriate ethical standards. Given the current size of the Company and the fact that the Company is only in the early stages of its restructure and the development of its new business, there is currently no official code of conduct in place. As the Company develops the Board intends to review its practices, and if deemed necessary, establish an appropriate code of conduct.

3.2. Companies should establish a policy concerning diversity and disclose the policy or a summary of that policy. The policy should include requirements for the board to establish measureable objectives for achieving gender diversity and for the board to assess annually both the objectives and progress in achieving them.

No The Company has not established a formal policy addressing diversity. Given the current size of the Company and the fact that the Company is only in the early stages of its restructure and the development of its new business, the Board does not consider it necessary to have a diversity policy. As the Company develops the Board intends to review its practices, and if deemed necessary in the future, the Board may consider adopting a policy in the future.

3.3. Companies should disclose in each annual report the measureable objectives for achieving gender diversity set by the board in accordance with the diversity policy and progress towards achieving them.

No As mentioned in 3.2 above, the Company has not established a formal policy addressing diversity

3.4. Companies should disclose in each annual report the proportion of women employees in the whole organisation, women in senior executive positions and women on the board.

No There are currently no women on the Board.

4. Safeguard integrity in financial reporting 4.1. The board should establish an audit committee. No The Company does not have a separately constituted audit

committee due to its current size and the fact that the Company is only in the early stages of its restructure and the development of its new business. The Company in general meeting is responsible for the appointment of the external auditors of the Company, and the Board from time to time will review the scope, performance and fees of those external auditors.

4.2. The audit committee should be structured so that it: consists only of non-executive directors; consists of a majority of independent directors; is chaired by an independent chair, who is not chair

of the board; has at least three members.

N/A The Company does not currently have an audit committee.

4.3. The audit committee should have a formal charter. N/A The Company does not currently have an audit committee.

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Explanation

5. Make timely and balanced disclosure 5.1. Companies should establish written policies

designed to ensure compliance with ASX Listing Rule disclosure requirements and to ensure accountability at a senior executive level for that compliance and disclose those policies or a summary of those policies.

No Due to the current size of the Company and the fact that the Company is only in the early stages of its restructure and the development of its new business, there are no written policies in place. The Company is however committed to providing relevant up-to-date information to its shareholders and the broader investment community in accordance with the continuous disclosure requirements under the ASX Listing Rules and the Corporations Act 2001. The Board has designated the Company Secretary as the person responsible for overseeing and coordinating disclosure of information to the ASX and shareholders as well as providing guidance to directors and employees on disclosure requirements and procedures.

6. Respect the rights of shareholders 6.1. Companies should design a communications policy

for promoting effective communication with shareholders and encouraging their participation at general meetings and disclose their policy or a summary of that policy.

No Although the Company does not have a formal communications policy in place, all material matters will be disclosed to the market in accordance with the Listing Rules. The Company encourages shareholders to register for receipt of announcements and updates electronically.

7. Recognise and manage risk 7.1. Companies should establish policies for the

oversight and management of material business risks and disclose a summary of those policies.

Yes The Board is responsible for the oversight and management of all material business risks. The Board’s collective experience will enable accurate identification of the principal risks that may affect the Company’s business. Key operational risks and their management will be recurring items for deliberation as Board meetings.

The risk profile can be expected to change and procedures adapted as the Company develops and it grows in size and complexity. The Board intends to continue to regularly review and approve the risk management and oversight policies of the Company.

7.2. The board should require management to design and implement the risk management and internal control system to manage the company’s material business risks and report to it on whether those risks are being managed effectively. The board should disclose that management has reported to it as to the effectiveness of the company’s management of its material business risks.

No This has not been formalised as a role of management, as this responsibility presently sits at Board level.

7.3. The board should disclose whether it has received assurance from the chief executive office (or equivalent) and the chief financial officer (or equivalent) that the declaration provided in accordance with section 295A of the Corporations Act is founded on a sound system of risk management and internal control and that the system is operating effectively in all material respects in relation to financial reporting risks.

No The Company has not yet appointed a chief executive officer.

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Explanation

8. Remunerate fairly and responsibly 8.1. The Board should establish a remuneration

committee. No As mentioned in 2.5 above, the Company does not have in

place a separately constituted remuneration committee due to the size and current operations of the Company.

8.2. The remuneration committee should be structured so that it:

consists of a majority of independent directors; is chaired by an independent chair; has at least three members.

No The Company does not currently have a remuneration committee.

8.3. Companies should clearly distinguish the structure of non-executive directors’ remuneration from that of executive directors and senior executives.

Yes The remuneration of an executive director will be decided by the Board, without the affected executive director participating in that decision-making process. There are currently no executive directors. The total maximum remuneration of non-executive directors is currently set at $500,000. Any increases will be the subject of a shareholder resolution in accordance with clause 13.7 of the Company’s constitution, the Corporations Act and the ASX Listing Rules, as applicable. The determination of non-executive directors’ remuneration within that maximum amount will be made by the Board, having regard to the inputs and value to the Company of the respective contributions by each non-executive director.

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Statement of financial position As at 30 June 2012

Parent Consolidated

Note

2012$

2011 $

ASSETS Current assets Cash and cash equivalents 10 973,783 9,108,000 Trade and other receivables 11 19,518 366,000 Inventories 12 10,000 86,000 Prepayments 13 9,000 -

Total current assets 1,012,301 9,560,000

Non-current assets Property, plant and equipment 14 20,000 4,602,000

Total non-current assets 20,000 4,602,000

TOTAL ASSETS 1,032,301 14,162,000

LIABILITIES Current liabilities Trade and other payables 15 76,683 22,367,966 Interest bearing loans and borrowings 16 - 8,510,000 Provisions 17 - 12,980,000

Total current liabilities 76,683 43,857,966

TOTAL LIABILITIES 76,683 43,857,966

NET ASSETS

955,618

(29,695,966)

EQUITY Contributed equity 18 54,394,609 52,209,763 Other reserve 19a 16,500 15,000 Accumulated losses 19e (53,455,491) (81,920,729)

TOTAL EQUITY 955,618 (29,695,966)

The above statement of financial position should be read in conjunction with the accompanying notes. F

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Statement of comprehensive income For the year ended 30 June 2012 Parent Consolidated

Note

2012$

2011 $

Continuing operations Sale of goods - 11,702,000 Rendering of services - 38,663,000

Revenues - 50,365,000 Cost of sales - (48,019,000)

Gross profit - 2,346,000 Other income 5 2,245 279,000 Selling & branch expenses - (4,880,000) Indirect factory and engineering expenses - (1,861,000) Administrators remuneration - (947,000) Liquidators remuneration - (8,000) Administration expenses (356,510) (10,484,000)

Loss from continuing operations before finance costs, impairment and redundancy costs

(354,265) (15,555,000)

Finance costs 6 - (3,001,000) Redundancy costs - (8,812,000) Recognition of parent entity contributed equity 18 - (35,765,000) Impairment of receivable 6 - (2,869,000) Impairment of plant, property & equipment 6 - (1,651,000) Impairment of goodwill 6 - (3,358,000)

Loss from continuing operations before income tax (354,265) (71,011,000)

Income tax benefit / (expense) 8 - (4,082,000)

Loss from continuing operations after income tax

(354,265)

(75,093,000)

Discontinued operations Profit from discontinued operations after tax 7 28,819,503 -

Net profit / (loss) attributable to members of the Company

28,465,238 (75,093,000)

Other comprehensive income - -

Total comprehensive profit / (loss) for the period 28,465,238 (75,093,000)

Earnings per share for profit / (loss) attributable to the ordinary equity holders of the Company:

Basic earnings/(loss) per share (cents) 25 - Continuing operations (0.50) (91.43) - Discontinued operations 40.65 -

40.15 (91.43)

Diluted (loss) / earnings per share (cents) 25 - Continuing operations (0.40) (91.43) - Discontinued operations 33.10 -

32.70 (91.43)

The above statement of comprehensive income should be read in conjunction with the acompanying notes.

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Statement of changes in equity For the year ended 30 June 2012 Parent

Contributed Equity

$

Share Option Reserve

$

(Accumulated Losses) / Retained Earnings

$

Total Equity $

At 1 July 2011 52,209,763 15,000 (81,920,729) (29,695,966) Profit for the year - - 28,465,238 28,465,238

Total comprehensive income for the year - - 28,465,238 28,465,238

Contributions of equity 2,250,000 1,500 - 2,251,500Shares issue costs (65,154) - - (65,154)

At 30 June 2012 54,394,609 16,500 (53,455,491) 955,618

Consolidated

At 1 July 2010 16,444,763 15,000 (6,827,729) 9,632,034 Loss for the year - - (75,093,000) (75,093,000)

Total comprehensive loss for the year - - (75,093,000) (75,093,000)

Recognition of parent entity contributed equity 35,765,000 - - 35,765,000

At 30 June 2011 52,209,763 15,000 (81,920,729) (29,695,966)

The above statement of changes in equity should be read in conjunction with the accompanying notes.

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Statement of cash flows For the year ended 30 June 2012

Parent Consolidated

Note

2012$

2011 $

Cash flows from operating activities

Receipts from customers 373,447 61,822,000 Payments to suppliers and employees (2,969,255) (52,657,000) Finance costs paid (495,000) (1,316,000)

Net cash flows (used in)/from operating activities 26 (3,090,808) 7,849,000

Cash flows from investing activities Interest received 185,245 131,000 Net cash outflow from discontinued operations (7,161,000) - Purchase of property, plant and equipment - (60,000) Proceeds from the disposal of plant and equipment 7,750,000 532,000

Net cash flows from investing activities 774,245 603,000

Cash flows from financing activities Proceeds from issue of shares 1,801,500 - Costs associated with issue of shares (65,154) - Repayment of convertible note (7,041,000) - Repayment of borrowings (513,000) (1,007,000)

Net cash flows from/(used in) financing activities (5,817,654) (1,007,000)

Net (decrease)/increase in cash and cash equivalents (8,134,217) 7,445,000 Cash and cash equivalents at beginning of year 9,108,000 1,663,000

Cash and cash equivalents at end of year

10

973,783

9,108,000

The above statement of cash flows should be read in conjunction with the accompanying notes.

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Notes to the financial statements For the year ended 30 June 2012 1. General information FRR Corporation Limited (formerly Frigrite Limited) (the Company) is a Company limited by shares incorporated in Australia whose shares are publicly traded on the Australian Securities Exchange. The financial report of FRR Corporation Limited (formerly Frigrite Limited) for the year ended 30 June 2012 was authorised for issue in accordance with a resolution of the directors on 5 September 2012.

2. Summary of significant accounting policies The principal accounting policies adopted in the preparation of the Financial Report are set out below. These policies have been consistently applied to the years presented, unless otherwise stated. (a) Basis of preparation This general purpose Financial Report has been prepared in accordance with Australian Accounting Standards, other authoritative pronouncements of the Australian Accounting Standards Board (AASB), Urgent Issues Group Interpretations and the Corporations Act 2001 where possible (refer to note 2(b) below). The Financial Report has been prepared on the basis that the Company is a going concern. The board considers that the Company has sufficient cash resources to meet all operating costs for at least the next twelve months from the date of this report. It is recommended that this financial report be read in conjunction with the public announcements made by FRR Corporation Limited during the year in accordance with the continuous disclosure requirements arising under the Corporations Act 2001.

Compliance with IFRS Australian Accounting Standards include Australian equivalents to International Financial Reporting Standards (AIFRS). Compliance with AIFRS ensures that the Financial Report of FRR Corporation Limited complies with International Financial Reporting Standards (IFRS). Historical cost convention These financial statements have been prepared under the historical cost convention. Critical accounting estimates The preparation of financial statements in conformity with AIFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Company’s accounting policies. Where these are areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, these are disclosed in Note 2(n). Comparative figures When required by accounting standards, comparative figures have been adjusted to conform to changes in presentation for the current year. When the Company applies an accounting policy retrospectively, makes a retrospective restatement or reclassifies items in its financial statements, a statement of financial position as at the beginning of the earliest comparative period will be disclosed. Refer to note 2(b) below regarding incomplete records and the potential impact on comparative figures. (b) Incomplete records The management and affairs of the Company were not under the control of the Directors from the date the Company entered voluntary administration on 16 June 2011 until the date the Deed of Company Arrangement (“DoCA”) effectuated, being 28 February 2012. Additionally, the Company’s subsidiaries, Frigrite Refrigeration Pty Ltd and Frigrite Refrigeration (QLD) Pty Ltd entered voluntary administration on 18 January 2011 and entered liquidation on 23 February 2011 and 18 April 2011 respectively. The financial report was prepared by Directors who were not in office at the time the Company entered voluntary administration or for the full periods presented in this report. The Directors who prepared this financial report were appointed on 28 November 2011 as part of the recapitalisation proposal approved by the Company’s creditors and shareholders.

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Notes to the financial statements (continued) For the year ended 30 June 2012 2. Summary of significant accounting policies (continued)

(b) Incomplete records (continued) As a result, the financial information relating to the 30 June 2012 financial report was not subject to the same accounting and internal controls processes, which includes the implementation and maintenance of internal controls, that are relevant to the preparation and fair presentation of the financial report. Furthermore, it has not been possible for the Directors to obtain all of the books and records of the Company for the period up to 28 February 2012, being the date that the DoCA effectuated and control of the Company was passed over to the Directors. Whilst the books and records of the Company have been reconstructed to the maximum extent possible, the Directors are unable to satisfy themselves as to the completeness of the general ledger and financial records as well as the relevant disclosures in the financial report for the year ended 30 June 2012. Consequently, the Directors are of the opinion that it is not possible to state that this financial report has been prepared in accordance with Australian Accounting Standards including Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001, because of the possible effect of this matter on the current year’s figures and the corresponding prior year figures. (c) Revenue recognition Interest revenue is recognised on a time proportionate basis using the effective interest method. (d) Cash and Cash Equivalents For statement of cash flow presentation purposes, cash and cash equivalents includes cash on hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less, and bank overdrafts. (e) Income Tax The income tax expense or revenue for the period is the tax payable on a current period’s taxable income based on the income tax rate adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses. Deferred tax is accounted for using the liability method in respect of temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a business combination, where there is no effect on accounting or taxable profit or loss. Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or liability is settled. Deferred tax is credited in the income statement except where it relates to items that may be credited directly to equity, in which case the deferred tax is adjusted directly against equity. Deferred income tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and tax losses. (f) Other receivables Other receivables are recognised at fair value and subsequently measured at amortised cost, less provision for impairment. (g) Trade and other payables These amounts represent liabilities for goods and services provided to the Company prior to the end of the financial year which are unpaid. The amounts are unsecured and usually paid within 30 days of recognition.

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(h) Borrowings Loans are carried at their principal amounts, which represent the present value of future cash flows associated with servicing the debt. Interest is accrued over the period it becomes due and is recorded as part of other creditors. (i) Contributed equity Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction from the proceeds. (j) Earnings per share Basic earnings per share (“EPS”) is calculated by dividing the result attributable to equity holders of the Company by the weighted number of shares outstanding during the year. Diluted EPS adjusts the figures used in the calculation of basic EPS to take into account the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number of shares assumed or known to have been issued in relation to dilutive potential ordinary shares. (k) Goods and Services Tax (GST)

Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Tax Office. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the balance sheet are shown exclusive of GST. Cash flows are presented in the statement of cash flow on a gross basis, except for the GST component of investing and financing activities, which are disclosed as operating cash flows.

(l) Dividends Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion of the Company, on or before the end of the financial year but not distributed at balance date. (m) Impairment of Assets

At each reporting date, the Company reviews the carrying values of its tangible and intangible assets to determine whether there is any indication that those assets have been impaired. If such an indication exists, the recoverable amount of the asset, being the higher of the asset’s fair value less cost to sell and value in use, is compared to the asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is expensed to the Statement of comprehensive income. Impairment testing is performed annually for intangible assets with indefinite lives.

(n) Critical Accounting Estimates and Judgements The Directors evaluate estimates and judgements incorporated into the financial report based on historical knowledge and best available current information. Estimates assumed a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the Company.

Key Estimates – Impairment

The Company assesses impairment at each reporting date by evaluating conditions specific to the Company that may lead to an impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is determined. Value-in- use calculations performed in assessing recoverable amounts incorporate a number of key estimates. All assets have been impaired as a result of the appointment of an Administrator. Assets have been written down to the amounts recovered by the Administrator.

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(o) New Accounting Standards for Application in Future Periods The AASB has issued a number of new and amended Accounting Standards and Interpretations that have mandatory application dates for future reporting periods, some of which are relevant to the Company.

At the date of the authorisation of the financial statements, the standards and Interpretations listed below were in issue but not yet effective.

Standard/Interpretation

Effective for

annual reporting

periods beginning

on or after

Expected to be

initially applied

in the financial

year ending

AASB 9 ‘Financial Instruments’, AASB 200911 ‘Amendments to Australian

Accounting Standards arising from AASB 9’ and AASB 2010-7 ‘Amendments to

Australian Accounting Standards arising from AASB 9 (December 2010)’

1 January 2013 30 June 2014

AASB 10 ‘Consolidated Financial Statements’ 1 January 2013 30 June 2014

AASB 11 ‘Joint Arrangements’ 1 January 2013 30 June 2014

AASB 12 ‘Disclosure of Interests in other Entities’ 1 January 2013 30 June 2014

AASB 127 ‘Separate Financial Statements’ (2011) 1 January 2013 30 June 2014

AASB 128 ‘Investments in Associates and Joint Ventures’ (2011) 1 January 2013 30 June 2014

AASB 13 ‘Fair Value Measurement’ and AASB 2011-8 ‘Amendments to Australian

Accounting Standards arising from AASB 13’


AASB 119 ‘Employee Benefits’ (2011) and AASB 2011-10 ‘Amendments to

Australian Accounting Standards arising from AASB 19 (2011)’


AASB 2010-8 ‘Amendments to Australian Accounting Standards – Deferred Tax:

recovery of Underlying Assets’


AASB 2011-4 ‘Amendments to Australian Accounting Standards to Remove

Individual Key Management Personnel Disclosure Requirements’

1 July 2013 30 June 2014

AASB 2011-7 ‘Amendments to Australian Accounting Standards arising from the

Consolidation and Joint Arrangements standards’


AASB 2011-9 ‘Amendments to Australian Accounting Standards – Presentation of

Items of Other Comprehensive Income’

1 July 2012 30 June 2013

Interpretation 20 ‘Stripping Costs in the Production Phase of a Surface Mine’ and

AASB 2011-12 ‘Amendments to Australian Accounting Standards arising from

Interpretation 20’.


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(o) New Accounting Standards for Application in Future Periods (continued) The Company has decided not to early adopt any of the new and amended pronouncements. Of the above new and amended Standards and Interpretations the Company's assessment of those new and amended pronouncements that are relevant to the Company but applicable in future reporting periods is set out below:

− AASB 9: Financial Instruments (December 2010) and AASB 2010-7: Amendments to Australian Accounting Standards arising from AASB 9 (December 2010) [AASB 1, 3, 4, 5, 7, 101, 102, 108, 112, 118, 120, 121, 127, 128, 131, 132, 136, 137, 139, 1023 & 1038 and Interpretations 2. 5, 10, 12, 19 & 127] (applicable for annual reporting periods commencing on or after 1 January 2013).

These Standards are applicable retrospectively and include revised requirements for the classification and measurement of financial instruments, as well as recognition and derecognition requirements for financial instruments.

The key changes made to accounting requirements include:

− simplifying the classifications of financial assets into those carried at amortised cost and those carried at fair value;

− simplifying the requirements for embedded derivatives;

− removing the tainting rules associated with held-to-maturity assets;

− removing the requirements to separate and fair value embedded derivatives for financial assets carried at amortised cost;

− allowing an irrevocable election on initial recognition to present gains and losses on investments in equity instruments that are not held for trading in other comprehensive income. Dividends in respect of these investments that are a return on investment can be recognised in profit or loss and there is no impairment or recycling on disposal of the instrument

− requiring financial assets to be reclassified where there is a change in an entity's business model as they are initially classified based on: (a) the objective of the entity's business model for managing the financial assets; and (b) the characteristics of the contractual cash flows; and

− requiring an entity that chooses to measure a financial liability at fair value to present the portion of the change in its fair value due to changes in the entity's own credit risk in other comprehensive income, except when that would create an accounting mismatch. If such a mismatch would be created or enlarged, the entity is required to present all changes in fair value (including the effects of changes in the credit risk of the liability) in profit or loss.

The Company has not yet been able to reasonably estimate the impact of these pronouncements on its financial statements. − AASB 13: Fair Value Measurement and AASB 2011-8: Amendments to Australian Accounting Standards arising from

AASB 13 [AASB 1, 2, 3, 4, 5, 7, 9, 2009-11, 2010-7, 101, 102, 108, 110, 116, 117, 118, 119, 120, 121, 128, 131, 132, 133, 134, 136, 138, 139, 140, 141, 1004, 1023 & 1038 and Interpretations 2, 4, 12, 13, 14, 17, 19, 131 & 132] (applicable for annual reporting periods commencing on or after 1 January 2013).

AASB 13 defines fair value, sets out in a single Standard a framework for measuring fair value, and requires disclosures about fair value measurements.

AASB 13 requires:

− inputs to all fair value measurements to be categorised in accordance with a fair value hierarchy; and

− enhanced disclosures regarding all assets and liabilities (including, but not limited to, financial assets and financial liabilities) measured at fair value.

These Standards are not expected to significantly impact the Company.

− AASB 2011-9: Amendments to Australian Accounting Standards – Presentation of Items of Other Comprehensive Income [AASB 1, 5, 7, 101, 112, 120, 121, 132, 133, 134, 1039 & 1049] (applicable for annual reporting periods commencing on or after 1 July 2012).

The main change arising from this Standard is the requirement for entities to group items presented in other comprehensive income on the basis of whether they are potentially reclassifiable to profit or loss subsequently.

This Standard affects presentation only and is not expected to significantly impact the Company.

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(o) New Accounting Standards for Application in Future Periods (continued)

AASB 119 (September 2011) also includes changes to the accounting for termination benefits that require an entity to recognise an obligation for such benefits at the earlier of:

(i) for an offer that may be withdrawn – when the employee accepts;

(ii) for an offer that cannot be withdrawn – when the offer is communicated to affected employees; and

(iii) where the termination is associated with a restructuring of activities under AASB 137: Provisions, Contingent Liabilities and Contingent Assets, and if earlier than the first two conditions – when the related restructuring costs are recognised.

The Company has not yet been able to reasonably estimate the impact of these changes to AASB 9.

(p) Application of new and revised Accounting Standards

The following new and revised Accounting Standards and Interpretations have, where applicable, been adopted in the current year but have had no significant effect on the amounts reported or disclosures.

Standards affecting presentation and disclosure

Amendments to AASB 7

‘Financial Instruments”

Disclosure’

The amendments (part of AASB 2010-4 ‘Further Amendments to Australian Accounting

Standards arising from the Annual Improvements Project’) clarify the required level of

disclosures about credit risk and collateral held.

Amendments to AASB 101

‘Presentation of Financial

Statements’

The amendments (part of AASB 2010-4 ‘Further Amendments to Australian Accounting

Standards arising from the Annual Improvements Project’) clarify that an entity may choose to

present the required analysis of items of other comprehensive income either in the statement of

changes in equity or in the notes to the financial statements.

AASB 1054 ‘Australian

Additional Disclosures’ and

AASB 2011-1 ‘Amendments to

Australian Accounting

Standards arising from Trans-

Tasman Convergence Project’

AASB 1054 sets out the Australian-specific disclosures for entities that have adopted

Australian Accounting Standards.

AASB 2011-1 makes amendments to a range of Australian Accounting Standards and

Interpretations for the purpose of closer alignment to IFRSs and harmonisation between

Australian and New Zealand Standards.

AASB 124 ‘Related Party

Disclosures’ (revised December

2009)

AASB 124 (revised December 2009) has been revised on the following two aspects: (a) AASB

124 (revised December 2009) has changed the definition of a related party and (b) AASB 124

(revised December 2009) introduces a partial exemption from the disclosure requirements for

government-related entities.

AASB 2009-14 ‘Amendments

to Australian Interpretation –

Prepayments of a Minimum

Funding Requirement’

Interpretation 114 addresses when refunds or reductions in future contributions should be

regarded as available in accordance with paragraph 58 of AASB 119.

AASB 2009-12 ‘Amendments

to Australian Accounting

Standards’

The application of AASB 2009-12 makes amendments to AASB 8 ‘Operating Segments’ as a

result of the issuance of AASB 124 ‘Related Party Disclosures (2009).



Standards’

The Standard makes numerous editorial amendments to a range of Australian Accounting

Standards and Interpretations.



Standards – Disclosures on

Transfers of Financial Assets’

The application of AASB 2010-6 makes amendments to AASB 7 ‘Financial Instruments –

Disclosures’ to introduce additional disclosure requirements for transactions involving transfer

of financial assets.

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(q) Share based payment transactions (i) Equity settled transactions The Group provides benefits to its employees (including key management personnel) in the form of share based payments, whereby employees render services in exchange for shares or rights over shares (equity settled transactions). The cost of these equity settled transactions with employees is measured by reference to the fair value of the equity instruments at the date at which they are granted. The charge to the statement of comprehensive income is taken when the options are granted. There is a corresponding entry to equity. The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.

3. Operating segments Operating segments are identified and segment information disclosed on the basis of internal reports that are regularly provided to, or reviewed by, the Company's chief operating decision maker which, for the Company, is the Board of Directors. In this regard, such information is provided using similar measures to those used in preparing the statement of comprehensive income and statement of financial position. The Company has one geographic segment being Australia and operates in one industry being being the design, supply, service and maintenance of commercial refrigeration and air conditioning systems..

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Notes to the financial statements (continued) For the year ended 30 June 2012

4. Financial risk management objectives and policies

Risk management is the role and responsibility of the board. The Company's current activities expose it to minimal risk. However, as activities increase there may be exposure to interest rate, market, credit, and liquidity risks (a) Interest Rate Risk

The Company’s exposure to interest rate risk, which is the risk that a financial instrument’s value will fluctuate as a result of changes in market rates and the effective weighted average interest rates on classes of financial assets and financial liabilities, is as follows:

Floating interest rate

$

1 year or less $

Over 1 year to 5 years

$

More than 5 years

$

Non interest bearing

$

Total

$ 30 June 2012 Financial Assets Cash and deposits 902,245 - - - 71,538 973,783 Trade and other receivables - - - - 19,518 19,518

902,245 - - - 91,056 993,301

Weighted average interest rate 3.5% - - - - 3.2%

Financial liabilities Trade and other payables - - - - 76,683 76,683

- - - - 76,683 76,683

Weighted average interest rate - - - - - -

30 June 2011 Financial Assets Cash and deposits 8,608,000 500,000 - - - 9,108,000

8,608,000 500,000 - - - 9,108,000


Financial liabilities Trade and other payables - - - - 22,367,966 22,367,966 Convertible notes - 8,510,000 - - - 8,510,000

- 8,510,000 - - 22,367,966 30,877,966


The Company has interest bearing assets and therefore income and operating cash flows are subject to changes in the market rates. However, market changes in interest rates will not have a material impact on the profitability or operating cash flows of the Group. A movement in interest rates of +/- 100 basis points will result in less than a +/- $9,000 (2011: $91,000) impact on the Group’s income and operating cash flows. At this time, no detailed sensitivity analysis is undertaken by the Group.

(b) Market risk

The Company is not exposed to equity securities price risk as it holds no investments in securities classified on the balance sheet either as available-for-sale or at fair value through profit or loss; or to commodity price risk.

(c) Credit risk

The Company has no significant concentrations of credit risk and as such, no sensitivity analysis is prepared by the Company.

(d) Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash to meet commitments as and when they fall due. The Company manages liquidity risk by preparing forecasts and monitoring actual cash flows and requirements for future capital raisings. The Group does not have committed credit lines available, which is appropriate given the nature of its operations. Surplus funds are invested in a cash management account with Westpac Banking Corporation which is available as required. The material liquidity risk for the Company is the ability to raise equity in the future.

(e) Effective interest rate and repricing analysis Cash and cash equivalents are the only interest bearing financial instruments of the Company.

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Notes to the financial statements (continued) For the year ended 30 June 2012 Note 5. Revenue Parent Consolidated

2012 $

2011$

Sundry income - 148,000 Interest earned 2,245 131,000

2,245 279,000

6. Loss for the year

Loss for the year includes the following expenses

Parent Consolidated

2012 $

2011$

Expenses Finance costs: Interest and finance charged - 3,001,000 Depreciation 14 - 395,000 Impairment of receivables - 2,869,000 Impairment of plant, property & equipment - 1,651,000 Impairment of goodwill - 3,358,000

7. Discontinued operations (a) Details of operations disposed On 16 June 2011, the Company went into voluntary administration. The Administrators sought expressions of interest from third parties in either acquiring the assets of the Company or reconstructing and recapitalising the Company. As part of this process, the creditors approved the Administrators entering into a Deed of Company Arrangement (DoCA) on 31 August 2011, pursuant to which the Deed Administrator was authorised, among other things, to investigate the restructure of the Company’s capital with a view to re-instating the Company’s Shares to quotation on the ASX for the benefit of creditors and Shareholders. The Company’s creditors subsequently agreed with a proposal presented by a syndicate headed by Pager Partners for the restructure and recapitalisation of the Company. This proposal was approved by Shareholders on 10 February 2012 and was successfully completed on 28 February 2012. At or subsequent to completion, the following occurred:

1) The syndicate headed by Pager Partners paid $513,000 to the Deed Administrator; 2) The Deed Administrator satisfied creditors’ claims under the Creditors Trust Deed, with all other liabilities and

obligations of the Company being comprised under the DoCA; 3) The Company confirmed the retention of the Company’s existing business assets (unencumbered); and 4) The DoCA terminated

(b) Financial performance of operations disposed

2012 $

2011$

Carrying value of Net Liabilities of Frigrite Refrigeration Pty Ltd and Frigrite Refrigeration (QLD) Pty Ltd

27,189,393

-

Net proceeds received from disposal - - Net result for the year 1,630,110 - Net gain on disposal of operations 28,819,503 -

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7. Discontinued operations (continued)

(c) Assets and liabilities of discontinued operations

2012 $

2011$

Cash and cash equivalents

7,161,000

-

Trade and other payables (21,889,393) - Interest bearing loans and borrowings (1,019,000) - Provisions (11,442,000) - Net liabilities attributed to discontinued operations (27,189,393) -

(d) Cash flows used in discontinued operations 2012

$ 2011

$

Net cash used in operating activities

(2,782,463)

-

Net cash from investing activities 772,000 - Net cash used in financing activities (7,554,000) Net cash out flows for the year (9,564,463)

(e) Net cash out flow from disposal 2012

$ 2011

$

Consideration received, satisfied in cash - Cash and cash equivalents disposed of (7,161,000) - Net cash outflow (7,161,000)

8. Income tax Parent Consolidated

2012

$ 2011

$ a) Numerical reconciliation of income tax expense to prima facie tax payable Loss from continuing operations before income tax expense (354,265) (71,011,000) Profit from discontinuing operations before income tax expense 28,819,503 -

28,465,238 (71,011,000)

Tax at the Australian tax rate of 30% 8,539,571 (21,303,300) Tax effect of amounts which are not deductable (taxable) income: (8,645,851) 21,303,300 Tax effect of amounts which are deductable (taxable) income: - - Derecognition of deferred tax asset - 4,082,000 Tax losses not recognised 106,280 -

Income tax expense - 4,082,000

Parent Consolidated

2012

$ 2011

$

b) Tax losses Unused tax losses for which no deferred tax asset has been recognised 354,267 -

Potential tax benefit at 30% 106,280 -

Tax losses related to the entity prior to the reconstruction that were not used and have been lost. Current tax losses have not been recognised as a deferred tax asset as recoupment is dependent on, amongst other matters, sufficient future assessable income being earned. That is not considered certain in the foreseeable future and accordingly there is uncertainty that the losses can be utilised. There are no deferred tax liabilities.

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Notes to the financial statements (continued) For the year ended 30 June 2012 9. Dividends

There were no dividends recommended or paid during the financial year.

10. Cash and cash equivalents Parent Consolidated

2012 $

2011$

Cash at bank and on hand 973,783 8,608,000 Short-term deposits - 500,000

973,783 9,108,000

11. Trade and other receivables

Parent Consolidated

2012 $

2011$

Trade receivables - 366,000 GST receivable 19,518 -

Carrying amount of trade and other receivables 19,518 366,000

Trade and other receivables are carried at their net realisable value. The balance has been impaired in the statement of comprehensive income $Nil (2011: $2,869,000).

12. Inventories Parent Consolidated

2012 $

2011$

Raw materials (at net realisable value) 10,000 86,000

Total inventories 10,000 86,000

13. Prepayments Parent Consolidated

2012 $

2011$

Prepayments 9,000 -

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Notes to the financial statements (continued) For the year ended 30 June 2012 14. Property, plant and equipment Reconciliation of carrying amounts at the beginning and end of the period

At 30 June 2012

At 30 June 2011

Parent 2012

Freehold Land $

Buildings $

Plant &

Equipment $

Leased Plant &

Equipment $

Total $

Year ended 30 June 2012 At 1 July 2011 net of accumulated depreciation and impairment

3,344,000

813,000

445,000

- 4,602,000

Disposal (net) (3,344,000) (813,000) (425,000) - (4,582,000)

At 30 June 2012 net of accumulated depreciation and impairment

-

-

20,000

-

20,000

Cost Accumulated depreciation and impairment

-

-

-

-

20,000

-

-

-

20,000

- Net carrying amount - - 20,000 - 20,000

Consolidated 2011

Freehold Land $

Buildings $

Plant & Equipment

$

Leased Plant & Equipment

$

Total $

Year ended 30 June 2011 At 1 July 2010 net of accumulated depreciation and impairment

3,344,000

813,000

2,552,000

458,000

7,167,000

Transfer between categories - - 458,000 (458,000) -

Additions - - - - -

Impairment - - (1,651,000) - (1,651,000)

Disposal (net) - - (519,000) - (519,000)

Depreciation charge for the year - - (395,000) - (395,000)

At 30 June 2011 net of accumulated depreciation and impairment

3,344,000

813,000

445,000

-

4,602,000

Cost Accumulated depreciation and impairment

3,344,000

-

1,299,000

(486,000)

6,535,000

(6,090,000)

-

-

11,178,000

(6,576,000)

Net carrying amount 3,344,000 813,000 445,000 - 4,602,000 For

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Notes to the financial statements (continued) For the year ended 30 June 2012 15. Trade and other payableS Parent Consolidated

2012 $

2011$

Trade, other payables and accruals 76,683 20,425,966 Other creditors - 1,942,000

76,683 22,367,966

The prior year trade and other payables have been satisfied by the Deed Administrator via the Creditors Trust Deed.

16. Interest bearing loans and borrowings Parent Consolidated

2012 $

2011$

Current Convertible notes-Issued and fully paid(secured) - 8,510,000

- 8,510,000

The prior year interest bearing loans and borrowings have been either repaid with cash or equity, or satisfied by the Deed Administrator via the Creditors Trust Deed.

17. Provisions

Parent Consolidated

2012 $

2011$

Current Employee entitlements (i) - 12,347,000 Warranty (ii) - 633,000

- 12,980,000

The prior year provisions have been satisfied by the Deed Administrator via the Creditors Trust Deed.

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Notes to the financial statements (continued) For the year ended 30 June 2012 18. Contributed equity (a) Issued share capital

Parent Consolidated

2012 $

2011$

Current

Ordinary shares fully paid 54,394,609 52,209,763

(b) Movement in ordinary share capital

Date Details Number of shares Issue price $ 01/07/2010 Opening balance 82,133,491 52,209,763 Issued during the year - -

30/06/2011 Balance at the end of the year (i) 82,133,491 52,209,763

Date Details Number of shares Issue price

$ 01/07/2011 Opening balance 82,133,491 52,209,763 24/02/2012 Share Consolidation 1:6 (68,444,116) 29/02/2012 Issue 45,000,000 $0.01 450,000 04/05/2012 Placement 120,000,000 $0.0025 300,000 04/05/2012 Issue 150,000,000 $0.01 1,500,000 Share Issue Costs (65,154)

30/06/2012 Balance at the end of the year 328,689,375 54,394,609

Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion to the number of and amounts paid on the shares held. On a show of hands or on a poll every holder of ordinary shares present at a meeting in person or by proxy is entitled to one vote. (i) No. Shares

Thousands

$

At 1 July 2010 82,133,491 16,444,763 Recognition of parent entity contributed equity - 35,765,000 1

At 30 June 2011 82,133,491 52,209,763

1 In a previous financial period, the Group accounted for a transaction as a reverse acquisition which resulted in the issued capital of the Group being less than that of the parent entity. As set out in note 2(b), there is insufficient information available to the Company to form an opinion on this treatment, thus the Group will recognise the full issued capital of the parent entity, resulting in a $35,765,000 adjustment to Contributed Equity with the debit being recognised as an expense in the Statement of Comprehensive Income.

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Notes to the financial statements (continued) For the year ended 30 June 2012 19. Options, reserves and accumulated losses 2012 2012 2011 2011 Options $ Options $ (a) Option at the end of the year 66,791,679 16,500 40,750,000 15,000

(b) Movement in options

Date Details Number of optionsFair value/ Issue Price

$

01/07/2010 Opening balance 40,750,000 15,000 Issued during the year - -

30/06/2011 Balance at the end of the year 40,750,000 15,000

Date Details Number of optionsFair value/ Issue Price

$

01/07/2011 Opening balance 40,750,000 15,000 24/02/2012 Consolidation 1:6 (33,958,321) - 04/05/2012 Issue 60,000,000 0.0025 cents 1,500

30/06/2012 Balance at the end of the year 66,791,679 16,500

(c) Option Premium Reserve

2012 2012 2011 2011 Options $ Options $ Movement in reserve Balance at beginning of the year 40,000,000 - 40,000,000 - Consolidation 1:6 (33,333,321) - - - Options issued 60,000,000 1,500 - -

66,666,679 1,500 40,000,000 -

The terms of the options issued on 4 May 2012 are as follows:

(1) Each Option gives the optionholder the right to subscribe for one (1) share. To obtain the right given by each Option, the optionholder must exercise the Options in accordance with these terms and conditions.

(2) The Options will expire at 5:00pm (AEST) on 31 December 2014 (Expiry Date). Any Option not exercised before the Expiry Date will automatically lapse on the Expiry Date.

(3) The amount payable upon exercise of each Option will be $0.01 (Exercise Price).

(4) The Options may be exercised in whole or in part, and if exercised in part, multiples of 100,000 must be exercised on each occasion.

(5) Optionholders may exercise their Options by lodging with the company, before the Expiry Date:

(i) a written notice of exercise of Options specifying the number of Options being exercised; and (ii) a cheque or electronic funds transfer for the Exercise Price for the number of Options being exercised;

(6) An Exercise Notice is only effective when the company has received the full amount of the Exercise Price in cleared funds.

(7) Within 10 business days of receipt of the Exercise Notice accompanied by the Exercise Price, the company will allot the number of shares required under these terms and conditions in respect of the number of Options specified in the Exercise Notice.

(8) The Options are freely transferable.

(9) All shares allotted upon the exercise of Options will upon allotment rank pari passu in all respects with other shares.

(10) The company will not apply for quotation of the Options on ASX. However, the company will apply for quotation of all shares allotted pursuant to the exercise of the Options on ASX within 10 business days after the date of allotment of those Shares.

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Notes to the financial statements (continued) For the year ended 30 June 2012 19. Options, reserves and accumulated losses (continued)

(11) If at any time the issued capital of the company is reconstructed, all rights of the optionholders are to be changed in a manner consistent with the Corporations Act 2001 and the ASX Listing Rules at the time of the reconstruction.

(12) There are no participating rights or entitlements inherent in the Options and the optionholder will not be entitled to participate in new issues of capital offered to shareholders during the currency of the Options. However, the company will ensure that for the purposes of determining entitlements to any such issue, the record date will be at least 6 business days after the issue is announced. This will give the optionholder the opportunity to exercise the Options prior to the date for determining entitlements to participate in any such issue.

(13) In the event the company proceeds with a pro rata issue (except a bonus issue) of securities to shareholders after the date of issue of the Options, the exercise price of the Options may be reduced in accordance with the formula set out in ASX Listing Rule 6.22.2.

(14) In the event the company proceeds with a bonus issue of securities to shareholders after the date of issues of the Options, the number of securities over which an Option is exercisable may be increased by the number of securities which the optionholder would have received if the Option had been exercised before the record date for the bonus issue.

(d) Share Based Payments Reserve

2012 2012 2011 2011 Options $ Options $ Movement in reserve Balance at beginning of the year 750,000 15,000 750,000 15,000 Consolidation 1:6 (625,000) - - -

125,000 15,000 750,000 15,000

Nature and Purpose of Reserves The option premium reserve arises pursuant to an issue of options pursuant to a capital raising. The share based payments reserve arises pursuant to an issue of shares or options as consideration for a service or an acquisition transaction.

Parent Consolidated

(e) Accumulated losses Movements in accumulated losses were as follows:

2012 $

2011 $

Balance at the beginning of the year (81,920,729) (6,827,729) Profit for the year 28,465,238 (75,093,000)

Balance at the end of the year (53,455,491) (81,920,729)

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20. Key management personnel disclosures (a) Key management personnel compensation

2012 $

2011 $

Short-term employee benefits 99,220 - Post-employment benefits 5,780 -

105,000 - Detailed remuneration disclosures are provided in sections 1 to 4 of the Remuneration Report in the Directors’ Report. There was no compensation paid to key management personnel in 2011. Other than the directors, the Company had 1 employee as at 30 June 2012. (b) Equity instrument disclosures relating to key management personnel (i) Option holdings

The numbers of options over ordinary shares in the Company held during the financial year by each director, including their personally related parties, are set out below: Director

Balance at the

start of the year

Granted during

the year

Exercised

during the year

Balance at the end of the year

Vested and exercisable at the end of the

year Hugh Warner - 16,000,000 - 16,000,000 16,000,000 Jonathan Pager - 8,666,667 - 8,666,667 8,666,667 Michael Pollak - 10,000,000 - 10,000,000 10,000,000

- 34,666,667 - 34,666,667 34,666,667 No options are vested and un-exercisable at the end of the year. There were no options granted during the reporting period as compensation. (ii) Share holdings

The numbers of shares in the Company held during the financial year by each director, including their personally related parties, are set out below: Director

Balance at the start of the year

Received during the year on the exercise

of options

Other changes during the year

Balance at the end of the year

Hugh Warner 277,778 - 53,000,000 53,277,778 Jonathan Pager - - 13,200,000 13,200,000 Michael Pollak - - 24,000,000 24,000,000

277,778 - 90,200,000 90,477,778 There were no shares granted during the reporting period as compensation.

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21. Auditors remuneration

2012 2011 $ $ During the year the following fees (exclusive of GST) were paid or payable for services provided by the auditor of the Company:

Audit services Audit and review of financial report and other audit work under the Corporations Act 2001

17,000 10,000

Non-audit services Other services provided 1 8,025 -

Total remuneration for audit and other services 25,025 10,000

The auditors of FRR Corporation Limited (formerly Frigrite Limited) are Stantons International. 1 These services were provided prior to Stantons International becoming the auditor of the Company

22 Contingent liabilities and contingent assets There are no current contingent liabilities or contingent assets

23. Related party disclosure (a) Key management personnel

Disclosures relating to key management personnel are set out in Note 20 and the detailed remuneration disclosures to the Directors’ Report. (b) Transaction with related parties

Anglo Pacific Ventures Pty Ltd, a company associated with Hugh Warner, charges the Company for office rental on normal commercial terms and conditions. Anglo Pacific Ventures Pty Ltd invoiced $12,000 (exclusive GST) for the current year (2011:$Nil).

Pager Partners Corporate Advisory Pty Ltd, a company associated with Jonathan Pager, charges the Company for office rental on normal commercial terms and conditions. Pager Partners Corporate Advisory Pty Ltd invoiced $2,000 (exclusive GST) for the current year (2011:$Nil).

Prior to becoming directors, the Directors formed a syndicate that agreed to pay $513,000 (on behalf of the Company) to the Deed Administrator for the purposes of satisfying all creditor claims, liabilities and obligations of the Company being compromised under the DoCA. The Company repaid the syndicate upon the completion of the capital raising.

(c) Outstanding balances arising from sales / purchases of goods and services

Anglo Pacific Ventures Pty Ltd is owed $17,471 and Pager Partners Corporate Advisory Pty Ltd is owed $2,200 at the reporting date in relation to transactions with related parties.

24. Events after balance sheet date

On the 6 July 2012, the Company announced it had entered into a Share Sale Agreement to acquire 100% of Minpac Properties Pty Ltd (“Minpac”) and its subsidiaries, in consideration for the issue of approximately 328,689,375 shares and 60,000,000 options exercisable at 1 cent per share. Minpac supplies custom configured, transportable, semi-permanent and permanent camp solutions to the mining and other remote location industries. In parallel with the acquisition, the Company has also entered into a joint venture with Minpac in relation to the air-conditioning and refrigeration components of the camps. The Company has provided joint venture funding to Minpac in the amount of $871,750 secured by a General Security Agreement. The Company is entitled to a margin equivalent to 7% of the joint venture advance On 9 August 2012, the Company issued a prospectus (supplementary prospectus lodged 21 August 2012) to issue up to 60,000,000 new ordinary shares at $0.01 to raise $600,000. The Company issued and allotted 49,000,000 first placement shares on 23 August 2012, with 11,000,000 second placement shares to be issued and allotted upon obtaining shareholder approval.

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25. Earnings per share

(a) Basic earnings per share

2012 Cents

2011 Cents

(Loss)/profit from continuing operations attributable to the ordinary equity holders of the Company (0.50) (91.43) Profit from discontinued operations 40.65 -

40.15 (91.43) (b) Diluted earnings per share (Loss)/profit from continuing operations attributable to the ordinary equity holders of the Company (0.40) (91.43) Profit from discontinued operations 33.10 -

32.70 (91.43) (c) Reconciliation of loss used in calculating earnings per share 2012

$ 2011

$ Basic and diluted loss per share (Loss)/profit from continuing operations attributable to the ordinary equity holders of the Company

(354,265) (75,093,000)

Profit from discontinued operations 28,819,503 - 28,465,238 (75,093,000) (d) Weighted average number of shares used as the denominator

2012 Number

2011 Number

Weighted average number of ordinary shares used as the denominator in calculating basic loss per share

70,894,854

82,133,000

Adjustments for calculation of diluted loss per share – Options

16,161,542 -

Weighted average number of ordinary shares and potential ordinary shares used as the denominator in calculating diluted loss per share

87,056,396 82,133,000

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26. Cash flow statement reconciliation Parent Consolidated

2012 $

2011$

Reconciliation of net loss after tax to net cash flows from operations

Operating (loss)/ Profit after income tax 28,465,238 (75,093,000) Adjustments for: Gain due to forgiveness of debt (27,189,393) - Gain on sale of property (3,168,000) - Depreciation and amortisation - 442,000 Impairment of receivables - 2,869,000 Impairment of intangible - 3,358,000 Impairment of property, plant and equipment - 1,651,000 Amortisation of loan and convertible note costs - 1,685,000 Recognition of parent entity contributed equity - 35,765,000 Share based payment expense - Interest income (185,245) (131,000) Changes in assets and liabilities (Increase)/decrease in assets and liabilities Trade and other receivables 346,482 11,309,000 Inventory 76,000 7,558,000 Prepayments (9,000) 391,000 Deferred tax assets - 4,082,000 Trade and other payables 76,683 6,051,000 Provisions (1,503,573) 7,912,000

Net cash from operating activities (3,090,808) 7,849,000

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27 Parent entity information Statement of financial position As at 30 June 2011 Parent

2011$

ASSETS Current assets Cash and cash equivalents 22,000 Trade and other receivables 7,555,000 Inventories 10,000

Total current assets 7,587,000 Non-current assets Property, plant and equipment 20,000

Total non-current assets 20,000

TOTAL ASSETS 7,607,000 LIABILITIES Current liabilities Trade and other payables 28,782,000 Interest bearing loans and borrowings 8,510,000

Total current liabilities 37,292,000 Non-current liabilities Interest bearing loans and borrowings -

Total non-current liabilities -

TOTAL LIABILITIES 37,292,000 NET ASSETS

(29,685,000)

EQUITY Contributed equity 52,225,000 Accumulated losses (81,910,000)

TOTAL EQUITY (29,685,000)

Profit / (loss) of the parent entity (75,246,000) Total comprehensive loss of the parent entity (75,246,000) On the 28 February 2012, the DOCA was effectuated and the Company was released from being subject to the DOCA. The Company’s subsidiaries, Frigrite Refrigeration Pty Ltd and Frigrite Refrigeration (QLD) Pty Ltd, were transferred to the Creditors’ Trust and were de-consolidated from the Group. The 2012 balances disclosed within this financial report are parent entity.

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Directors' Declaration 1. In the opinion of the Directors of FRR Corporation Limited (formerly Frigrite Limited) (‘the Company’):

(a) as set out in note 2, although the Directors have prepared the financial statements, notes thereto, and the remuneration disclosures contained in the Remuneration Report in the Directors’ Report to the best of their knowledge based on the information made available to them, they are of the opinion that it is not possible to state that the financial statements, notes thereto, and the remuneration disclosures contained in the Remuneration Report in the Directors’ Report, are in accordance with the Corporations Act 2001, including:

(i) giving a true and fair view of the Company’s financial position as at 30 June 2012 and of its performance

for the financial year ended on that date; and

(ii) complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Regulations 2001.

2. There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

On behalf of the Directors

Hugh Warner Director Perth, Western Australia 5 September 2012

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43

Additional Information required by the Australian Securities Exchange Limited Listing Rules and not disclosed elsewhere in this report is set out below. The shareholder information was applicable as at 29 August 2012. (a) Substantial Shareholders The substantial shareholders are: Name

Number Held Percentage of Issued Shares

HD & DM Warner 53,277,778 14.11 Leeds Morgan Pty Ltd 36,500,000 9.66 United Equity Partners Pty Ltd ATF Polycorp Family Trust 24,000,000 6.35 Holloway Cove Pty Ltd atf Holloway Cove Superannuation Fund 22,277,778 5.90 (b) Voting Rights Ordinary Shares On a show of hands every member present at a meeting of shall have one vote and upon a poll each share shall have one vote. Options There are no voting rights attached to the options (c) Distribution of Equity Security Holders

Category Ordinary Fully Paid Shares % Issued Capital 1 – 1,000 247,069 0.07 1,001 – 5,000 1,285,063 0.34 5,001 – 10,000 718,648 0.19 10,001 – 100,000 3,318,859 0.88 100,001 and over 372,119,736 98.53

Total 377,689,375 100.00 There were 1,183 holders of less than a marketable parcel of ordinary shares.

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ASX Additional Information (continued) (d) Equity Security Holders The names of the twenty largest holders of quoted equity securities are listed below: Name

Number Held Percentage of Issued Shares

1. LEEDS MORGAN PTY LTD 36,500,000 9.66%

2. ELLIOT HOLDINGS PTY LTD 30,000,000 7.94%

3. UNITED EQUITY PARTNERS PTY LTD 24,000,000 6.35%

4. HOLLOWAY COVE PTY LTD 22,000,000 5.82%

5. HUGH WARNER & DIANNE WARNER 20,277,778 5.37%

6. PPK INVESTMENT HOLDINGS PTY LTD 13,822,145 3.66%

7. WAVET FUND NO 2 PTY LTD 11,627,778 3.08%

8. PPK INVESTMENT HOLDINGS PTY LTD 11,250,000 2.98%

9. POLFAM PTY LTD 10,000,000 2.65%

10. JOHN BURSTON 10,000,000 2.65%

11. OCEANVIEW SUPER FUND PTY LTD 8,000,000 2.12%

12. EQUIPMENT COMPANY OF AUSTRALIA PTY LTD 5,696,455 1.51%

13. PAGER PARTNERS CORPORATE ADVISORY PTY LTD 5,200,000 1.38%

14. VECTOR NOMINEES PTY LTD 5,000,000 1.32%

15. RANCHLAND HOLDINGS PTY LTD 5,000,000 1.32%

16. MR DAVID ARTHUR PAGANIN 5,000,000 1.32%

17. EQUIPMENT COMPANY OF AUSTRALIA PTY LTD 5,000,000 1.32%

18. CARWOOLA PASTORAL CO PTY LIMITED 4,500,000 1.19%

19. AURA CAPITAL ADVISERS PTY LTD 4,300,000 1.14%

20. HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED 4,011,646 1.06%

TOTAL 241,185,802 63.86%

Unquoted equity securities Number on Issue Number of Holders Options – exercisable at $1.20 before 26 November 2014 125,000 2 Options – exercisable at $0.01 before 31 December 2014 60,000,000 22 F

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