WENTWORTH HOLDINGS LIMITED ABN 41 080 167 264 NOTICE OF GENERAL MEETING & EXPLANATORY STATEMENT

For the General Meeting to be held at 10 am at the offices of InvestorFirst Limited, Level 29, 55 Collins Street, Melbourne VIC 3000 on Monday 6 August 2012.

In this document you will find:

• A letter from the Chairman of the Company outlining the proposed resolutions to be considered at the General Meeting. $\ddagger$ .
• $\overline{2}$ . Notice of Meeting.
• An Explanatory Statement containing an explanation of, and information about, the proposed resolutions to be $3₁$ considered at the General Meeting.
• 1. Proxy Form.

This Notice of Meeting and the accompanying Explanatory Statement should be read in its entirety. If Shareholders are in doubt as to how they should vote, they should seek advice from their accountant, solicitor or other professional adviser prior to voting.

Wentworth Holdings

28 June 2012

Dear Shareholder

On 23 December 2011, Wentworth announced the completion of the sale of its rent rolls and associated assets/liabilities. Since that time, Wentworth actively sought a new undertaking. This involved meeting with approximately 50 potential investees/contacts to source investments.

In the course of this activity, against a background of continuing economic uncertainty, it became apparent:

• There were limited quality businesses suitable for Wentworth. $\blacksquare$
• Quality businesses considered by Wentworth were typically at above market valuations and therefore deemed too expensive, particularly given the economic outlook.
• There are opportunities to invest in entities (both listed and unlisted) at attractive valuations that would likely provide more reliable longer term returns (capital and income) and less volatility through diversification across different entities.

On the basis on the above, it is proposed that Wentworth change its main undertaking to that of an Investment Company.

As an Investment Company, Wentworth will provide investors with the opportunity to invest in a portfolio of investments assembled through the application of a defined investment process using the experience of an Investment Committee. The Investment Committee will contain Wentworth directors and draw on external specialists with relevant investment experience when required. The Company will predominantly invest in a combination of ASX listed securities, unlisted entities and debt Instruments. Where appropriate investments cannot be identified, available funds will be invested in cash. The Company will focus on absolute performance with respect to its investments.

As at 31 May 2012, Wentworth had a net tangible asset position (NTA) of circa 6.6 cents per share. The change in nature of Wentworth's business will not have a material impact on the Company's NTA. At this stage, there is no intention to issue new securities to raise capital. Wentworth has circa \$14 million in cash able to be invested immediately.

Wentworth is pleased to provide to shareholders appropriate documents that will allow then to consider this proposed change of undertaking and accordingly vote on the resolution at the Extraordinary General Meeting convened concerning the matter.

On behalf of your board of directors, we look forward to your support of this change of undertaking.

Yours sincerely

Gilige

Vaughan Webber - Chairman

Wentworth Holdings Limited ABN 41 080 167 264

144 Church Street Brighton VIC 3186 T 03 8591 0500 F 03 9592 7607 E [email protected]

NOTICE OF GENERAL MEETING

Notice is given that a General Meeting of Wentworth Holdings Limited (ACN 080 167 264) (Company) will be held at 10 am at the offices of InvestorFirst Limited, Level 29, 55 Collins Street, Melbourne VIC 3000 on Monday, 6 August 2012. Terms and abbreviations used in this Notice of Meeting are defined in the Glossary.

AGENDA

• any person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities, if the resolution is passed; and
• any of their associates,

except where the votes are cast: (a) by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the proxy form, or (b) by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

By order of the Board

R Holland

Ron Hollands - Company Secretary 28 June 2012

PROCEDURAL NOTES

EXPLANATORY STATEMENT

This information forms part of the Notice of Meeting. The main purpose of this Explanatory Statement is to provide Shareholders with information concerning the Resolutions.

The Explanatory Statement and all attachments are important documents. They should be read carefully. The Directors recommend Shareholders read this Explanatory Statement in full before making any decision in relation to the Resolutions.

Background $\mathbf{1}$

At a general meeting of the Company held on 15 December 2011, Shareholders approved the disposal by the Company of its main undertaking, namely all controlled entities that held assets relating to Wentworth's property asset management services business.

Since that time, the Company has been actively working to identify a new undertaking for the Company. This has involved meeting with approximately 50 potential investees/contacts to source investments. In the course of this activity, against a background of continuing economic uncertainty, it has become apparent:

• There were limited quality businesses suitable for Wentworth.
• Quality businesses considered by Wentworth were typically at above market valuations and therefore deemed too expensive, particularly given the economic outlook.
• There are opportunities to invest in entities (both listed and unlisted) at attractive valuations that would likely provide more reliable longer term returns (capital and income) and less volatility through diversification across different entities.

On the basis on the above, subject to Shareholder approval, it is proposed that Wentworth change its main undertaking to that of an Investment Company.

Investment Company $\mathbf{2}$

$\overline{21}$ Overview

It is proposed that Wentworth change its main undertaking to that of an Investment Company.

As an Investment Company, Wentworth will provide investors with the opportunity to invest in a portfolio of investments assembled through the application of a defined investment process using the experience of an Investment Committee. The Investment Committee will contain Wentworth directors and draw on external specialists with relevant investment experience when required. The Company will predominantly invest in a combination of ASX listed securities, unlisted entities and debt instruments. Where appropriate investments cannot be identified, available funds will be invested in cash. The Company will focus on absolute performance with respect to its investments.

Refer Appendix A for details of the Company's proposed investment principles and philosophies.

$2.2$ Risk management

Investment Committee

The Board will establish an Investment Committee to make investment decisions to support the Company's Corporate Objective. The Investment Committee will contain Wentworth directors and draw on external specialists with relevant investment experience when required. The Investment Committee decisions will be executed by Wentworth's Chief Financial Officer.

Risk Management Framework

The Company will adopt a Risk Management Framework in accordance with Recommendation 7.1 of the ASX Corporate Principles of Good Corporate Governance.

The Board will be assisted in its Risk Management Activities by the Audit Committee which is expected to meet at least 4 times a year. Co-ordination of Risk Management activities will be done by the CFO, who will report to the Audit Committee on such matters.

Two main areas of risk that have been identified:

Investment Risk -Will be addressed through the establishment of an Investment Committee and the careful selection and diversification of investments across sectors and industries. Concentration and value-at-risk reports are part of the Company's review.

The Trading Portfolio will be held for short-term opportunities and will never be more than 50% of the assets of the Company. Credit and settlement risk will also be reviewed as part of the Risk Management Framework.

Operational Risk -Internal controls and review processes will be developed to mitigate against systems and process risk and error and fraud. These internal controls include, inter alia, peer review, reconciliations, different authority levels and sign-offs and dual signatories. The Company will develop a Disaster Recovery Programme to mitigate the effects of any disaster and enable the business of the Company to continue.

Legal, regulatory and reputational risk are also part of the Risk Management framework, and considered by the Audit Committee. As well as experienced staff and directors, the Company will utilise external advisors to mitigate these rieke i

$2.3$ Effect of the change in nature of activities on the capital structure of the Company

As at the date of this Notice of Meeting, the Company has 223,802,639 ordinary class shares on issue.

The change in nature of business activity to an Investment Company is not expected to have any effect on the existing capital structure of the Company, and based on its current net tangible asset position, the Company is not expected to require further funds to be raised at this stage.

$2.4$ Financial effect of the change in nature of activities

As at 31 May 2012, Wentworth had a Net Tangible Asset position of circa 6.6 cents per share. The change in nature of Wentworth's business will have no material impact on the Net Tangible Asset position of the Company

$2.5$ Indicative timetable for the change in nature of activities

The anticipated timetable for the completion of the change in nature of activities is set out below. The below dates are indicative only and may change without notice.

$2.6$ Risks - change of activities

The Company has set out below a summary of some of the risks faced by it in changing the nature of its activities. The risks noted below should not be taken to be an exhaustive description of the risks faced by the Company. The risks below, and others not specifically referred to below, may in the future affect the financial and operational performance of the Company and its Shares.

$(a)$ Individual Investment Risk

Individual investments within the Company's investment portfolio may fall in value for many reasons such as changes in the entity's internal operations, management or in its business environment. If this occurs, the value of the NTA of the Company will fall which is likely to have a negative effect on the Company's Share price.

$(b)$ Interest Rate Risk

Changes in interest rates can have an impact directly or indirectly on investment valuations and returns on any cash deposits held.

$(c)$ Company Risk

Risks particular to the Company include that the Company may give different after tax results than investing individually because of income or capital gains accrued in the Company.

$(d)$ Liquidity

The Company may invest in unlisted securities or in companies whose securities are thinly traded. Therefore, its ability to sell securities may be restricted.

$(e)$ Industry Risk

There are a number of industry risk factors that may affect the future operational performance of the Company. These factors are outside the control of the Company. Such factors include increased regulatory and compliance costs, unforeseen Government legislation, and collapse in equity markets.

$(f)$ Reliance on key personnel

The Company intends to put in place systems and processes to mitigate the risk of losing key personnel. However, the loss of key personnel within the Company could have a negative impact on the Company.

$(g)$ Financial Market Volatility

A fall in global or Australian equity markets, global or Australian bond markets or a rapid change in the value of the Australian dollar against other major currencies may discourage investors from moving money into or out of equity markets. This may have a negative effect on Share prices.

$(h)$ Performance of other Asset Classes

Good performance, or anticipated performance, of other asset classes can encourage individuals to divert money away from equity markets. This may have a negative impact on the value of the investment portfolio.

$(i)$ Potential Acquisitions

As part of its business strategy, the Company may make acquisitions of or significant investments in other resource projects. Any such transactions would be accompanied by risks commonly encountered in making such acquisitions.

$(i)$ Absolute Performance versus Relative Performance

It is the objective of the Company to show positive returns on its investment regardless of the underlying movement in value of the investment markets. With such an objective, the value of the investment portfolio cultivated by the Company may not change in line with the overall movements in the market and its performance may differ significantly from funds that seek to measure performance against the broader share market.

$(k)$ Tax

Taxation and changes to tax systems can have an effect on returns but also the relative merit of putting monies in various asset classes and in an individual security.

$2.7$ Directors' recommendation

The Directors recommend that Shareholders vote in favour of Resolution 1.

$2.8$ Implications if Resolution 1 is not approved

If Resolution 1 is not approved, the Company will remain listed (but potentially suspended) as a 'cash box' until such time as it can acquire or establish an alternative business.

Resolution 1: Change of nature of activities -3

$\overline{3.1}$ General

Resolution 1 seeks approval from Shareholders for a change in the nature of the activities of the Company to an Investment Company.

$3.2$ ASX Listing Rule 11.1

ASX Listing Rule 11.1 provides that where an entity proposes to make a significant change, either directly or indirectly, to the nature or scale of its activities, it must provide full details to ASX as soon as practicable. ASX Listing Rule 11.1.2 provides that, if ASX requires, the entity must get the approval of Shareholders and must comply with any requirements of ASX in relation to the Notice of Meeting.

The ASX has indicated to the Company that, given the significant change in the nature and scale of the activities of the Company, it requires the Company to obtain the approval of its Shareholders.

For this reason, the Company is seeking Shareholder approval for the Company to change the nature and scale of its activities under ASX Listing Rule 11.1.2.

GLOSSARY

The following words and expressions used in the notice of meeting and Explanatory Statement have the following meanings unless the context requires otherwise:

ASIC means the Australian Securities & Investments Commission.

ASX means ASX Limited ACN 98 008 624 691

Board means the board of directors of the Company.

Business Day means a day (not being a Saturday, Sunday or public holiday) on which Australian banks (as defined in Section 9 of the Corporations Act) are open for general banking business in Melbourne. Victoria

Company or Wentworth means Wentworth Holdings Limited (ACN 080 167 264).

Corporations Act means the Corporations Act 2001 (Cth).

Director means a director of the Company.

Explanatory Statement means the explanatory statement accompanying the notice of meeting for the general meeting of the Company to be held on 6 August 2012 at 10am at the offices of InvestorFirst Limited at Level 29, 55 Collins Street, Melbourne VIC 3000.

Listing Rules means the Listing Rules of the ASX.

Notice of Meeting means this notice of general meeting including the Explanatory Statement and the Proxy Form.

Proxy Form means the proxy form accompanying the Notice of Meeting.

Resolution means a resolution proposed in the Notice of Meeting.

Share means a fully paid ordinary share in the capital of the Company.

Shareholder means a holder of Shares.

PROXY FORM

APPOINTMENT OF PROXY WENTWORTH HOLDINGS LIMITED ACN 080 167 264

or failing the person so named or, if no person is named, the Chair of the General Meeting, or the Chair's nominee, to vote in accordance with the following directions, or, if no directions have been given, and subject to the relevant laws as the proxy sees fit, at the General Meeting to be held at 10am (AEST) on 6 August 2012 at the offices of In Collins Street Melbourne VIC 3000, and at any adjournment thereof.

If no directions are given, the Chair will vote in favour of all the Resolutions in which the Chair is entitled to vote undirected proxies.

Instructions for completing 'Appointment of Proxy' Form

• (Appointing a Proxy): A member entitled to attend and cast a vote at a General Meeting is entitled to appoint a proxy to $\mathbf{1}$ attend and vote on their behalf at the meeting. If the member is entitled to cast 2 or more votes at the meeting, the member may appoint a second proxy to attend and vote on their behalf at the meeting. However, where both proxies attend the meeting, voting may only be exercised on a poll. The appointment of a second proxy must be done on a separate copy of the Proxy Form. A member who appoints 2 proxies may specify the proportion or number of votes each proxy is appointed to exercise. If a member appoints 2 proxies and the appoint ments do not specify the proportion or number of the member's votes each proxy is appointed to exercise, each proxy may exercise one-half of the votes. Any fractions of votes resulting from the application of these principles will be disregarded. A duly appointed proxy need not be a member of the Company.
• (Direction to Vote): A member may direct a proxy how to vote by marking one of the boxes opposite each item of $2.$ business. Where a box is not marked the proxy may vote as they choose. Where more than one box is marked on an item the vote will be invalid on that item.

3. (Signing Instructions):

• (Individual): Where the holding is in one name, the member must sign. $(a)$
• (Joint Holding): Where the holding is in more than one name, all of the members should sign. $(b)$
• (Power of Attorney): If you have not already provided the Power of Attorney with the registry, please attach a $(c)$ certified photocopy of the Power of Attorney to this form when you return it.
• (Companies): Where the company has a sole director who is also the sole company secretary, that person must $(d)$ sign. Where the company (pursuant to Section 204A of the Corporations Act) does not have a company secretary, a sole director can also sign alone. Otherwise, a director jointly with either another director or a company secretary must sign. Please sign in the appropriate place to indicate the office held.
• (Attending the Meeting): Completion of a Proxy Form will not prevent individual members from attending the General 4. Meeting in person if they wish. Where a member completes and lodges a valid Proxy Form and attends the General Meeting in person, then the proxy's authority to speak and vote for that member is suspended while the member is present at the General Meeting.
• (Return of Proxy Form): To vote by proxy, please complete and sign the enclosed Proxy Form and return by: 5.
• Hand or post to 144 Church Street Brighton VIC 3186; or $(a)$
• $(b)$ facsimile to the Company on facsimile number 03 9592 7607; or
• $(c)$ email to the Company at [email protected].

so that it is received not less than 48 hours prior to commencement of the Meeting (ie 10 am, Thursday, 2 August 2012).

Proxy forms received later than this time will be invalid.

Appendix A - Wentworth investment principles and philosophy

How we invest

The Company will aim to provide investors with the opportunity to invest in a portfolio of investments assembled through the application of a defined investment process using the experience of the Investment Committee. The Company will predominantly invest in a combination of ASX listed securities, unlisted entities and debt instruments. Where appropriate investments cannot be identified, available funds will be invested in cash. The Company will focus on absolute performance with respect to its investments.

Investment Objectives

The investment objectives of the Company are to:

• Preserve capital over most periods of time;
• Provide investors with a positive capital return, over most periods of time; and
• Deliver a regular income stream in the form of fully franked dividends.

Investment Philosophy broad principles

• Seek to provide positive returns in all market conditions by taking advantage of opportunities created by corporate transactions including takeovers, demergers, preference share conversions, IPO's, placements and sell downs or other trading and arbitrage opportunities.
• Potential investments will be all ASX quoted securities, unlisted securities, bills of exchange, other negotiable $\bullet$ investments, debentures and other debt instruments noting:
• No more than 20% of the investments will be held in unlisted securities.
• Investments can include "micro-cap" and/ or "large-cap" stocks and/or stocks being issued or sold below the $\mathbf{e}^{\mathbf{e}}$ current market price or WWM valuation or are the subject of a corporate event.
• The Company believes in diversification and will not hold more than 20% of its capital in any one investment noting this flexibility to take significant positions in individual securities may reduce portfolio diversity and therefore increase the exposure to abnormal falls in the market price of any single investment.
• Capital preservation is a key investment objective.

Investment Strategies and Process

There will be no single investment strategy adopted by the Company; rather the Investment Committee will employ a combination of strategies to achieve the objectives of the Company. Relevant strategies may include the following:

• Participating in initial public offerings, placements, block trades and rights issues, hybrid issues and convertible note $\blacksquare$ issues and traditional share investments.
• Focusing on merger transactions and other corporate actions.
• Buying securities in LIC's, where they trade at a significant discount to underlying net assets.
• The use of leverage where appropriate.

Permitted investments

^<sup>1 Based on prior month management accounts.

^<sup>2 Investments held for under 1 year.