INFORMATION STATEMENT

WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE
REQUESTED NOT TO SEND US A PROXY

INTRODUCTION

This Information Statement is being furnished to the stockholders of Freestone Resources, Inc., a Nevada corporation (the “Company,“ “Freestone,” “we,” “our” or “us” or words or similar import) regarding a resolution to file with the Nevada Secretary of State a Certificate of Change: (i) increasing our authorized shares of common stock from one hundred million (100,000,000) shares having a par value of one mill ($0.001) per share to six hundred million (600,000,000) shares and retaining the par value of $0.001 per share (the “Common Stock Resolution”); and (ii) increasing our authorized shares of preferred stock from five million (5,000,000) shares having a par value of one mill ($0.001) per share to ten million (10,000,000) shares and retaining the par value of $0.001 per share (the “Preferred Stock Resolution”). Collectively, the Common Stock Resolution and the Preferred Stock Resolution are referred to herein as the “Resolutions.” A copy of the Certificate of Change effectuating the Resolutions is attached as Appendix “A” hereto. The Resolutions were adopted effective as of October 7, 2018, by our entire Board of Directors and certain Company stockholders who collectively own approximately 51.36% of our outstanding voting securities (the “Majority Stockholders”) in accordance with applicable provisions of the Nevada Revised Statutes. The names and number of shares held by the Majority Stockholders are as follows:

(1) A total of 13,304,167 of these shares are held of record by GM Johnston Family LP (the “Limited Partnership”), of which Mr. Johnston is Manager. The beneficial owners of the Limited Partnership have executed a proxy granting Mr. Johnston the power to vote the Limited Partnership’s Company shares on these matters in his discretion.

(2) Deborah McGhan and Michael McGhan are spouses.

(3) These shares have been voted by Clayton Carter pursuant to the irrevocable proxy granted to him by ESSI under the terms of that certain Global Settlement and Full Release and Waiver dated June 26, 2011, which was filed as an exhibit to the Company’s Current Report on Form 8-K dated June 26, 2011, and filed with the Securities and Exchange Commission on June 30, 2011.

(4) Mr. Carter has granted to Clayton Carter a proxy to vote his shares on these matters in Clayton Carter’s discretion.

(5) Due to rounding, this figure does not precisely reflect the total of the percentages set forth above.

There are currently 98,238,177 issued and outstanding shares of the Company’s common stock, with 100,000,000 such shares authorized. We currently have 5,000,000 authorized shares of preferred stock, with none issued or outstanding. We have not designated any rights or preferences of our authorized preferred stock. Our Board of Directors and the Majority Stockholders believe that the increase in the number of authorized shares of common stock and preferred stock is in the best interests of the Company in that it will provide the Company with available shares for various corporate purposes, including the sale of common stock and securities convertible into common stock, as well as acquisitions, stock dividends and options. Our Board of Directors believes that it may be necessary to seek additional debt and/or equity financing in the remainder of the Company’s fiscal year ending June 30, 2019, although we have not entered into any definitive discussions with any third parties in this regard. See the captions “The Common Stock Resolution” and “The Preferred Stock Resolution” commencing on pages 3 and 4 hereof.

VOTE REQUIRED FOR APPROVAL AND EFFECTIVE DATE

Vote Required for Approval

Section 78.390 of the Nevada Revised Statutes provides that every amendment to the Articles of Incorporation of a corporation such as an increase in the corporation’s authorized capital shall first be adopted by a resolution of the Board of Directors and then be subject to the approval of persons owning a majority of the securities entitled to vote on any such amendment. Sections 78.315 and 78.320, respectively, provide that the Board of Directors, by unanimous written consent, and persons owning the required majority of voting securities necessary to adopt any action that would otherwise be required to be submitted to a meeting of stockholders, may adopt such action without a meeting by written consent. In addition, Article I, Section 11 of the Company’s amended Bylaws authorizes any action required to be taken at a meeting of stockholders to be taken without a meeting if a consent in writing, setting forth the action so taken, is signed by a majority of the stockholders entitled to vote on such action. Under Article I, Section 8 of our Bylaws, each outstanding share of our common stock is entitled to one vote on each matter submitted to a vote of stockholders. Both the Common Stock Resolution and the Preferred Stock Resolution were adopted by our Board of Directors and by the Majority Stockholders in accordance with the above-referenced statutes and provisions of our Bylaws. See the caption “Voting Securities and Principal Holders Thereof” herein.

The Majority Stockholders, who have consented in writing to approve the Resolutions, collectively own approximately 51.36% of our issued and outstanding common stock, and the Company has no outstanding voting securities aside from its common stock. Accordingly, no additional votes are required or necessary to adopt the Resolutions, and none are being solicited hereunder. There are no voting agreements or other arrangements among the Majority Stockholders with respect to either of the Resolutions or with respect to any other matter.

Effective Date of Actions

Pursuant to Reg. Sections 240.14c-2(d) and 240.14a-16(b) of the Commission, the Resolutions will not be effective until 40 calendar days after the mailing date of the Company’s Notice of Internet Availability of Information Statement, as discussed immediately below. The Resolutions will be effectuated by the filing of the Certificate of Change with the Secretary of State of Nevada, which we intend to file as soon as practicable but no earlier than 40 days after the mailing date of the Notice of Internet Availability.

Important Notice of Internet Availability of Information Statement and Related Materials

As permitted by the federal securities laws, Freestone is making this Information Statement available to our stockholders primarily via the Internet instead of mailing printed copies of these materials to each stockholder. On or about October 20, 2018, we intend to mail to our stockholders (other than those who request electronic or paper delivery) a Notice of Internet Availability containing instructions on how to access this Information Statement. This Information Statement is available for viewing on the Internet at : http://www.freestoneresources.com/investors.

If you received a Notice by mail, you will not receive a printed copy of this Information Statement by mail unless you request printed materials. If you wish to receive printed materials, you should follow the instructions for requesting such materials contained in the Notice.

Each of the Resolutions is outlined below and will become effective on a date that is at least 40 days from the mailing of the Notice of Internet Availability to our stockholders, which effective date is anticipated to be November 29, 2018. The Resolutions are the only matters covered by this Information Statement.

Dissenters’ Rights OF APPRAISAL

The Nevada Revised Statutes do not provide any dissenters’ rights with respect to either of the Resolutions. Therefore, no dissenters’ rights of appraisal will be given in connection therewith.

THE COMMON STOCK RESOLUTION

AMENDMENT OF THE COMPANY’S ARTICLES OF INCORPORATION TO INCREASE THE AUTHORIZED COMMON STOCK FROM 100,000,000 SHARES TO 600,000,000 SHARES

Our Board of Directors and the Majority Stockholders have adopted a resolution to amend the Company’s Articles of Incorporation to increase our authorized common stock from one hundred million (100,000,000) shares to six hundred million (600,000,000) shares, while retaining the par value of our common stock at one mill ($0.001) per share (the “Common Stock Resolution”). The Common Stock Resolution will take effect upon the filing of the Certificate of Change with the Nevada Secretary of State. The Company will make this filing as soon as practicable, but no earlier than 40 days after the mailing date of the Notice of Internet Availability. A copy of the Certificate of Change is attached as Appendix “A” hereto.

The increase in the Company’s authorized shares of common stock may have the effect of preventing or delaying the acquisition by third parties of a controlling interest in the Company. Our ability to issue a vastly increased number of voting securities may lead to an increase in the number of votes required in order to approve a change in control of Freestone and may make it substantially more difficult for third parties to gain control of Freestone through a tender offer, proxy contest, merger or other transaction. The ability to prevent a change in control may deprive our stockholders of any benefits that may result from such a change in control, including the potential realization of a premium over the market price for our common stock that such a transaction may cause. Furthermore, the issuance of a large block of additional shares to parties who may be deemed “friendly” to our Board of Directors may make it more difficult to remove incumbent directors from office, even if such removal would benefit our common stockholders. Despite these potential anti-takeover effects, however, the Board of Directors and the Majority Stockholders believe that the financial flexibility afforded by an increase in our authorized common shares outweighs any potential disadvantages. The Board of Directors and the Majority Stockholders have adopted the Common Stock Resolution with a view to such flexibility, and not with a view to its potential anti-takeover effects. We have no present intention to use the increased number of authorized common shares for any anti-takeover purpose; however, on November 2, 2017, the Company entered into an Agreement and Plan of Merger (the “Plan”) with Freestone Dynamis Acquisition, LLC, an Idaho limited liability company and wholly-owned subsidiary of the Company; and Dynamis Energy, LLC, an Idaho limited liability company, which is one of the Majority Stockholders who consented to the Resolutions.  The terms of the Plan were discussed in a Current Report on Form 8-K that the Company filed with the Securities and Exchange Commission (the “Commission”) on November 6, 2017, and which is available by www.freestoneresouces.com in this Information Statement.

One of the closing conditions of the Plan is that the Company’s stockholders approve, and the Company file with the Nevada Secretary of State, an amendment to our Articles of Incorporation to increase the number of our authorized shares of common stock in an amount sufficient to consummate the merger and the rights offering, equity incentive plan and the other transactions contemplated by the Plan.  The increase in our authorized common stock pursuant to the Common Stock Resolution will meet this closing condition, and as a result, stockholder approval of the Plan will not be required for any presently contemplated purpose.  Nonetheless, there remain certain other significant closing conditions to the Plan and, although we are continuing to work toward meeting these conditions, we can provide no assurance that we will be successful in this regard or that the Plan will be closed. 

The Company’s issuance of any additional shares of common stock may dilute both the equity interests and the earnings per share of our existing common stockholders. Such dilution may be substantial, depending on the number of shares issued. The newly authorized shares of common stock will have voting and other rights identical to those of the currently authorized shares of common stock. The amendment of our Articles of Incorporation to effectuate the Common Stock Resolution will not have any material effect on the Company’s business operations or reporting requirements with the Commission, other than the requirement that we file a Current Report on Form 8-K with respect to such amendment. Our stockholders do not need to take any action with respect to the Common Stock Resolution.

THE PREFERRED STOCK RESOLUTION

AMENDMENT OF THE COMPANY’S ARTICLES OF INCORPORATION TO INCREASE THE AUTHORIZED PREFERRED STOCK FROM 5,000,000 SHARES TO 10,000,000 SHARES

Our Board of Directors and the Majority Stockholders have adopted a resolution to amend the Company’s Articles of Incorporation to increase our authorized preferred stock from five million (5,000,000) shares to ten million (10,000,000) shares, while retaining the par value of our preferred stock at one mill ($0.001) per share (the “Preferred Stock Resolution”). The Preferred Stock Resolution will take effect upon the filing of the Certificate of Change with the Nevada Secretary of State. The Company will make this filing as soon as practicable, but no earlier than 40 days after the mailing date of the Notice of Internet Availability. A copy of the Certificate of Change is attached as Appendix “A” hereto.

The increase in the Company’s authorized shares of preferred stock may also have the effect of preventing or delaying the acquisition by third parties of a controlling interest in the Company. As of the date hereof, the Company has neither issued any shares of its preferred stock nor designated the rights and preferences thereof, and it has no present intention either to issue any such shares or to make any such designation. However, it is common to designate voting rights for preferred shares and/or to make such preferred shares convertible into common shares or some other voting security. In the event that the Company makes any such designation, our ability to issue a vastly increased number of voting securities (or shares of common stock that may be convertible into voting securities) may lead to an increase in the number of votes required in order to approve a change in control of Freestone and may make it substantially more difficult for third parties to gain control of Freestone through a tender offer, proxy contest, merger or other transaction. The ability to prevent a change in control may deprive our stockholders of any benefits that may result from such a change in control, including the potential realization of a premium over the market price for our common stock that such a transaction may cause. Furthermore, the issuance of a large block of additional shares to parties who may be deemed “friendly” to our Board of Directors may make it more difficult to remove incumbent directors from office, even if such removal would benefit our common stockholders. Despite these potential anti-takeover effects, however, the Board of Directors and the Majority Stockholders believe that the financial flexibility afforded by an increase in our authorized preferred shares outweighs any potential disadvantages. The Board of Directors and the Majority Stockholders have adopted the Preferred Stock Resolution with a view to such flexibility, and not with a view to its potential anti-takeover effects. We have no present intention to use the increased number of authorized preferred shares for any anti-takeover purpose or otherwise.

The Company’s issuance of any additional shares of preferred stock may also dilute both the equity interests and the earnings per share of our existing common stockholders. Such dilution may be substantial, depending on the number of shares issued and the voting and/or conversion rights, if any, that the Company may designate for the preferred stock in the future. The amendment of our Articles of Incorporation to effectuate the Preferred Stock Resolution will not have any material effect on the Company’s business operations or reporting requirements with the Commission, other than the requirement that we file a Current Report on Form 8-K with respect to such amendment. Our stockholders do not need to take any action with respect to the Preferred Stock Resolution.

INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON

No director, executive officer, nominee for election as a director, associate of any director, executive officer or nominee or any other person has any substantial interest, direct or indirect, by security holdings or otherwise, in any of the above-referenced items that is not shared by all stockholders.