Crater Gold Mining : Renounceable Entitlement Offer - Letters to Securityholders

PO Box 7054

Cloisters Square, WA 6850

Australia

Ph [phone]

Crater Gold Mining Limited ABN 75 067 519 779

23 January 2019

The Manager

ASX Market Announcements Australian Securities Exchange Limited

Renounceable Entitlement Offer - Letters to Shareholders and Option holders.

Attached are copies of three letters, which have been dispatched 23 January 2019 to shareholders and option holders in relation to the entitlement offer as recently announced to the market:

•  A letter to Shareholders with registered addresses in Australia, New Zealand, Hong Kong and Papua New Guinea, who are eligible to participate in the entitlement offer;

•  A letter to Shareholders with registered addresses outside Australia, New Zealand, Hong Kong and Papua New Guinea, who have been notified that they are not eligible to participate in the entitlement offer; and

•  A letter to Option Holders advising they do not have a right to participate in the Entitlement Offer but to advise that if options are exercised prior to the record date, they may participate in the entitlement offer.

Andrea Betti

Company Secretary

Email:[e-mail]

Website:www.cratergold.com.au

PO Box 7054

Cloisters Square, Perth, WA 6850

Australia

Ph [phone]

Crater Gold Mining Limited ABN 75 067 519 779

23 January 2019

Dear Shareholder,

RENOUNCEABLE ENTITLEMENT OFFER

On 12 December 2018, Crater Gold Mining Limited (ACN 067 519 779) (ASX: CGN) (Company) announced that the Company would be conducting a renounceable entitlement offer of approximately 1,537,056,263 fully paid ordinary shares in the capital of the Company (Shares) on the basis of 11 Share for every 2 Shares held at 7.00pm (AEDT) on 25 January 2019 (Record Date) at an issue price of $0.015 per Share to raise approximately $23.055m (before issue costs) (Offer).

Freefire Technology Limited (Freefire), a major shareholder has committed to take up its full entitlement as has the Company's Chairman, Mr Sam Chan. As a result the offer is committed to $13,253,619.

The purpose of the Offer is to raise funds to:

• a) repay $13,253,619 of debt currently due to Freefire;

• b) pay down the current negative working capital balance (taking into account cash and net trade payables)

• c) continue physical exploration over Anomaly's tenements in PNG

  d)progress commercial gold production at the HGZ mine (located within the Crater Mountain Project);

• e) continue physical exploration over the Croydon Project tenements;

• f) pay for expenses of the Offer; and

• g) provide working capital and funds for general corporate purposes.

The Offer is made pursuant to a prospectus lodged with the Australian Securities and Investments Commission (ASIC) on 22 January 2019 (Prospectus) and released to the Australian Securities Exchange (ASX) on the same date.

The Prospectus is available on the Company's website atwww.cratergold.com.au or on the ASX website (company announcements section, ASX code: CGN) atwww.asx.com.au.

It is anticipated that the Prospectus will be sent to all shareholders in Australia, New Zealand, Hong Kong or Papua New Guinea on 30 January 2019.

Offer was subject to Shareholder approval of the acquisition by Mr Chan and Freefire under the Offer. Shareholder approval was obtained on 17 January 2019.

Summary of key features of the Offer

The Offer is open to shareholders who hold Shares as at the Record Date with registered addresses in Australia, New Zealand, Hong Kong or Papua New Guinea (Eligible Shareholders). All other shareholders are not eligible to participate in the Offer and will be notified by the Company separately (Excluded Shareholders). Excluded Shareholders will not be entitled to subscribe for Shares under the Offer. The Company's Excluded Shareholders are in Brazil, Canada, Switzerland, Fiji, United

Kingdom, Ireland, Malaysia, Philippines, Singapore and United States of America.

Under the terms of the Offer, Eligible Shareholders will be entitled to subscribe 11 Shares for every 2 Shares held at the Record Date at an issue price of A$0.015 per Share (Entitlements). Where fractions arise in the calculation of Entitlements, they will be rounded up to the nearest whole number of Shares. Entitlements to Shares pursuant to the Offer are renounceable. This enables Shareholders who do not wish to subscribe for some or all of their Entitlement under the Offer to sell their respective Entitlements and also enables Shareholders to purchase additional Entitlements if they wish. Eligible Shareholders

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Website:www.cratergold.com.au

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may also apply for additional Shares in excess of their Entitlement on the terms set out in the Prospectus.

The Company only has one register with the existing ordinary shares from the date of issue.

The current number of Shares on issue in the Company is 279,464,775. Under the Offer, up to 1,537,056,263 Shares will be issued and the number of Shares on issue at the completion of the Offer will be up to approximately 1,816,521,038. The number of options and performance rights on issue will remain unchanged as a result of the Offer.

The Company currently has 22,600,000 unquoted options with varying exercise prices and expiry dates, on issue. Existing option holders may participate in the Offer upon exercise of their options provided and resulting Shares are issued by the Record Date. Given the exercise prices of these Options and the Company's current share price, the Directors consider it is unlikely any of these Options will be exercised prior to the Record Date. The Company sent a notice to option holders on 23 January 2019 notifying them of their right to participate in the Offer upon exercise of their options.

The Company has 37,201,020 Performance Rights on issue. The performance Rights cannot be exercised at this time and so holders cannot participate in the Offer.

Indicative timetable

The indicative timetable for the Offer is as follows:

Event	Date
Announcement of Offer	12 December 2018
Lodgement of Appendix 3B with ASX	22 January 2019
Prospectus lodged at ASIC and ASX	22 January 2019
"Ex" Date (date Shares are quoted ex-rights)	24 January 2019
Rights trading commences	24 January 2019
Record Date to determine Entitlements	7.00pm (AEDT) 25 January 2019
Prospectus (together with Entitlement and Acceptance Form) despatched to Shareholders	30 January 2019
Opening Date	30 January 2019
Rights trading ends	12 February 2019
Shares quoted on a deferred settlement basis	13 February 2019
Closing Date**	19 February 2019
Notification to ASX of under subscriptions	22 February 2019
Issue Date	26 February 2019
Normal trading of Shares issued under the Offer commences**	26 February 2019

January 2019

January 2019

January 2019

anuary 2019

January 2019

2019

2019

February 2019

February 2019

February 2019

February 2019

The above timetable is indicative only and subject to change. The Company reserves the right to amend any or all of these events, dates and times subject to the Corporations Act 2001 (Cth), the ASX Listing Rules and other applicable laws. In particular, the Company reserves the right to extend the closing date of the Offer, to accept late applications either generally or in particular cases or to withdraw the Offer without prior notice. The commencement of quotation of Shares is subject to confirmation from ASX.

Brief instructions for Eligible Shareholders

If you are an Eligible Shareholder, you may do the following: You may participate in the Offer as follows:

• a) If you wish to accept your Entitlement in full:

  • i. pay the amount indicated on your Entitlement and Acceptance from via BPAY© using the BPAY© code and personalised reference number indicated so that the funds are received before 5.00pm (AEDT) on the Closing Date; or

  • ii. complete the Entitlement and Acceptance Form, filling in the details in the spaces provided and attach your cheque for the amount indicated on your Entitlement and Acceptance Form.

• b) If you only wish to accept part of your Entitlement:

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Website:www.cratergold.com.au

• i. pay a lesser amount than indicated on your Entitlement and Acceptance Form via BPAY© using the BPAY© code and personalised reference number indicated so that the funds are received before 5.00pm (AEDT) on the Closing Date; or

• ii. fill in the number of Shares you wish to accept in the space provided on the Entitlement and Acceptance Form and attach your cheque for the appropriate application monies (at $0.015 per Share).

• c) If you do not wish to accept all or part of your Entitlement, you are not obliged to do anything.

• d) If you wish to sell or part of your Entitlement on ASX, please follow the instructions set out on the reverse of the Entitlement and Acceptance Application Form under the section marked "Sale of your Entitlement in full or in part by your Stockbroker". Rights trading commences on 24 January 2019. You must deal with your Entitlement by close of trading on ASX on 12 February 2019 when rights trading ceases.

• e) If you wish to transfer all or part of your Entitlement (other than on market using ASX) then you must forward:

  • i. a completed standard renunciation form (obtainable from your stockbroker or the

    Company's share registry);

  • ii. the Entitlement and Acceptance Form completed by the transferee; and

    • A. transferee's cheque for the amount due in respect of the Shares; or

    • B. transferee's payment of the amount indicated on your Entitlement and Acceptance Form via BPAY© to the Company's share registry not later than

      5.00pm AEDT on the Closing Date. BPAY© payments are to be made using the BPAY© code and personalised reference number indicated on your Entitlement and Acceptance Form and funds must be received before 5.00pm (AEDT) on the Closing Date.

All cheques or bank drafts must be drawn on an Australian branch of a financial institution and made payable in Australian currency to "Crater Gold Mining Limited" and crossed "Not Negotiable".

Your completed Entitlement and Acceptance Form and cheque must be:

Mailed to	Hand delivered to:
Crater Gold Mining Limited	Crater Gold Mining Limited
C/- Link Market Services Limited	OR	C/- Link Market Services Limited
GPO Box 3560	1A Homebush Bay Drive
SYDNEY NSW 2001	RHODES NSW 2138

and received no later than 5.00pm (AEDT) on the Closing Date.

More information

Before making a decision whether to apply for Shares, please read the Prospectus carefully in its entirety when you receive it. The Offer is scheduled to close at 5.00pm (AEDT) 19 February 2019.

This letter is not a prospectus and does not constitute an offer of securities. An offer of Shares under the Offer will only be made in, or accompanied by, a copy of the Prospectus sent to all eligible shareholders.

The Directors of the Company recommend that if you are in doubt as to the value of the Offer then you should contact your financial adviser.

If you have any queries regarding your Entitlement, please contact the Company on (From overseas): [phone] (From Australia): 08 6188 8181 or your stockbroker, financial or other professional adviser.

Yours faithfully

Andrea Betti Company Secretary

Email:[e-mail]

Website:www.cratergold.com.au

PO Box 7054

Cloisters Square, Perth, WA 6850

Australia

Ph [phone]

Crater Gold Mining Limited ABN 75 067 519 779

23 January 2019

Dear Shareholder,

ENTITLEMENT OFFER

We write to you as a holder of Crater Gold Mining Limited (ACN 067 519 779) ('Company') fully paid ordinary shares (Shares) as at today's date with a registered address outside of Australia, New Zealand, Hong Kong and Papua New Guinea (Excluded Foreign Holders).

On 12 December 2018, the Company announced it would be conducting a renounceable entitlement issue to eligible shareholders of approximately 1,537,056,263 Shares at an issue price of $0.015 per Share on the basis of 11 Shares for every 2 Shares held at 7.00pm (AEDT) on 25 January 2019 (Record Date) to raise approximately $23.055 million before expenses (Offer). Offer was subject to Shareholder approval of the acquisition by Mr Chan and Freefire under the Offer. Shareholder approval was obtained on 17 January 2019.

The Offer will only be made to all registered shareholders on the Record Date and who reside in Australia, New Zealand, Hong Kong or Papua New Guinea.

The Offer is made pursuant to a prospectus lodged with the Australian Securities and Investments Commission (ASIC) on 22 January 2019 (Prospectus). The Prospectus is available on the Company's website:www.cratergold.com.au or on the ASX website (company announcements section, ASX code: CGN):www.asx.com.au).

The Company has determined, pursuant to Listing Rule 7.7.1(a) of the ASX Listing Rules, that it is unreasonable to extend the Offer to those shareholders that are Excluded Foreign Holders. The Company has taken into consideration the size of the shareholdings held by the Excluded Foreign Holders and the costs of complying with the legal requirements and the requirements of the regulatory authorities relating to Excluded Foreign Holders. Accordingly, the Company is unable to extend to you the opportunity to participate in the Offer.

The Company has appointed Millinium Capital Managers Limited (AFSL 284 336) (ACN 111 283 357)

("Millinium") as nominee for foreign holders of the Company's securities in those countries outside of

Australia, New Zealand, Hong Kong, and Papua New Guinea to arrange the sale of the entitlements which would have been offered to the Excluded Foreign Holders.

Millinium will arrange for the sale of the Entitlements of the Excluded Foreign Holders. Millinium will account to the Company's share registry who will then dispatch the net proceeds (if any) (that is, sale proceeds after deducting fees and GST) pro rata to each individual Excluded Foreign Holder. Neither the Company nor Millinium will be subject to any liability for failure to sell the Entitlements.

Thank you for your ongoing support of the Company, if you have any questions in relation to the above, please contact the Company on (From overseas): [phone] (From Australia): 08 6188 8181 or your stockbroker, financial or other professional adviser.

Yours faithfully

Andrea Betti Company Secretary

Email:[e-mail]

Website:www.cratergold.com.au

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