DIGITALX LIMITED — Capital/Financing Update 2007

Aug 8, 2007

VERUS INVESTMENTS LIMITED

ABN 59 009 575 035

PROSPECTUS

A non-renounceable rights issue to existing shareholders of 2 New Options exercisable at $0.10 on or before 30 June 2010 at an issue price of $0.002 each for every 3 Shares held to raise up to approximately $318,392 before costs of the Offer.

IMPORTANT NOTICE This Prospectus is issued in accordance with section 713 of the Corporations Act 2001. It should be read in its entirety. If you are in any doubt as to how to deal with this document, please consult your stockbroker or financial adviser

CONTENTS

1. INVESTMENT SUMMARY................................................ 3 2. DETAILS OF THE OFFER ................................................ 4 3. VERUS AND ITS OPERATIONS ...................................... 7 4. EFFECT OF ISSUE ON VERUS..................................... 10 5. RISK FACTORS.............................................................. 12 6. ADDITIONAL INFORMATION......................................... 15 7. DEFINITIONS & GLOSSARY.......................................... 26

CORPORATE DIRECTORY ..................................................... 29

ENTITLEMENT AND ACCEPTANCE FORMS

It is the responsibility of overseas Applicants to ensure compliance with all laws of any country relevant to their Acceptance.

A number of terms and abbreviations used in this Prospectus have defined meanings, which are explained in the Glossary.

Key Dates for Investors

Record Date for determining entitlements under the Issue: 23 August 2007 Offer Opens: 23 August 2007 Offer Expected to Close: 12 September 2007 Trading of New Options on the ASX expected to commence: 20 September 2007 Expected Date for Dispatch of New Option holding statements: 20 September 2007

Offer Statistics

Number of New Options to be Issued: 159,196,107 Issue Price: $0.002

All dates are subject to change and accordingly are indicative only. The Company has the right to vary the dates of the Offer, without prior notice. Investors are encouraged to submit their Entitlement and Acceptance Forms as soon as possible.

How to Accept Entitlement to New Options

Entitlements to New Options can be accepted in full or in part by completing and returning the Entitlement and Acceptance Form which is attached to this Prospectus in accordance with the instructions set out below and on the Entitlement and Acceptance Form.

This Prospectus is available in electronic form on the Internet at www.verusinvestments.com.au. If you wish to obtain a free copy of this Prospectus, please contact the Company on +61 2 9233 2520.

Important Notice

This Prospectus is dated 9 August 2007 and was lodged with the ASIC on that date. Neither the ASIC nor ASX take any responsibility for the contents of this Prospectus. No securities will be issued on the basis of this Prospectus later than thirteen (13) months after the date of this Prospectus.

The Company has not made investigation as to the regulatory requirements that may prevail in the countries, outside of Australia, in which the Company’s Shareholders may reside. The distribution of this Prospectus in jurisdictions outside Australia may be restricted by law and persons who come into possession of this Prospectus should seek advice on and observe those restrictions. Any failure to comply with restrictions might constitute a violation of applicable securities laws.

No person named in this Prospectus, nor any other person, guarantees the performance of Verus, the repayment of capital or the payment of a return on the New Options.

No person is authorised to give any information or to make any representation in connection with the Offer which is not contained in this Prospectus. Any information or representation in relation to the Offer which is not contained in this Prospectus may not be relied on as having been authorised by the Company or its Directors in connection with the Offer.

This Prospectus is issued in accordance with section 713 of the Corporations Act. This means that this Prospectus does not of itself contain all the information that is generally required to be set out in a document of this type. Rather, in preparing this Prospectus, regard is made to the fact that the Company is offering options to acquire “continuously quoted securities” for the purposes of the Corporations Act and that certain matters may reasonably be expected to be known to investors and their professional advisers.

You should carefully consider whether the securities offered by this Prospectus are an appropriate investment for you. The securities offered by this Prospectus should be considered speculative.

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1. INVESTMENT SUMMARY

The information set out in this section is not intended to be comprehensive and should be read in conjunction with the full text of this Prospectus.

1.1 The Offer

This Prospectus is for the non-renounceable rights issue of approximately 159,196,107 New Options at an issue price of $0.002, on the basis of 2 New Options for every 3 Shares held by Shareholders as at the Record Date of 23 August 2007. New Options will be exercisable at $0.10 each on or before 30 June 2010.

The Company intends to apply for listing of the New Options on the ASX as soon as practicable following their allotment.

1.2 Minimum Subscription

There is no minimum subscription to the Issue.

1.3 New Option Terms

Each New Option will be issued on the terms set out in Section 6.3 of this Prospectus. Each Share issued upon exercise of a New Option will rank equally with all existing Shares then on issue.

1.4 Acceptance of Entitlement to New Options

The number of New Options to which each Shareholder is entitled is shown on the Entitlement and Acceptance Form accompanying this Prospectus. This Prospectus is for the information of Shareholders who are entitled and may wish to apply for the New Options. Fractional entitlements will be rounded up.

Entitlements to New Options can be accepted in full or in part by completing and returning the Entitlement and Acceptance Form which is attached to this Prospectus in accordance with the instructions set out below and on the Entitlement and Acceptance Form.

Shareholders cannot apply for more New Options than shown on the Entitlement and Acceptance Form accompanying this Prospectus.

1.5 Purpose of the Issue

The Directors intend to apply the proceeds from the Issue to pay the costs of the Issue (estimated at $33,500) and for working capital.

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2. DETAILS OF THE OFFER

2.1 Offer to Shareholders

The Directors of Verus have approved a non-renounceable rights issue of approximately 159,196,107 New Options at $0.002 per New Option to raise approximately $318,392 (before expenses associated with the Issue are paid). Each New Option allotted will be exercisable at $0.10 each on or before 30 June 2010. Shareholders of Verus are entitled to subscribe for 2 New Options for every 3 Shares held.

Only those Shareholders shown on the share register at 5.00 pm (Sydney time) on the Record Date will be entitled to participate in the Issue.

When fractions arise in the calculation of Entitlements, they will be rounded up to the nearest whole number of New Options.

2.2 Important Dates

Record Date for the Offer	23 August 2007 at 5.00 pm AEST
Opening Date of Offer	23 August 2007 at 9:00 am AEST
Closing Date of Offer	12 September 2007 at 5:00 pm AEST
Expected date for commencement of trading
of New Options on ASX	20 September 2007
Expected date of despatch of New Options
holding statements	20 September 2007

The dates set out in this table are subject to change and are indicative only. The Company reserves the right to alter this timetable at any time.

2.3 Placement of Shortfall

The Company has entered into arrangements as disclosed in Section 6.6 of this Prospectus to place the Shortfall, in the event that there is a Shortfall in subscriptions under the Issue. If any Shortfall is not dealt with under the arrangements described in Section 6.6, the Directors reserve the right, as contemplated within the Listing Rules, to allocate any Shortfall in their discretion so as to ensure a maximum amount of funds are raised.

2.4 How to Accept Your Entitlement

Shareholders may accept their Entitlement either in whole or in part.

The number of New Options to which Shareholders are entitled to is shown on the Entitlement and Acceptance Form which accompanies this Prospectus.

If Shareholders take no action in respect of their Entitlement they will have no right to subscribe for the New Options pursuant to this Offer.

Entitlements to New Options can be accepted in full or in part by completing and returning the Entitlement and Acceptance Form which is attached to this Prospectus in accordance with the instructions set out on the Entitlement and Acceptance Form and forwarding the completed Form together with your cheque or bank draft for the full amount payable so as to reach the Share Registry by no later than 5.00 pm (Sydney time) on the Closing Date.

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The Issue Price of $0.002 per New Option is payable in full on acceptance of part or all of your Entitlement.

Cheques should be in Australian currency and made payable to "Verus Investments Limited - Entitlement Offer" and crossed "not negotiable". No brokerage or handling fees are payable by the Applicant for New Options offered by this Prospectus. Completed Forms and accompanying cheques should be lodged at or forwarded to the following address:

By Mail: OR By Hand: Verus Investments Limited C/: Computershare Investor Services GPO Box 253, Sydney, NSW, 2001

Verus Investments Limited C/: Computershare Investor Services Level 2, Carrington Street Sydney, NSW, 2000

Or Direct at: Verus Investments Limited Level 15, 25 Bligh Street SYDNEY, NSW, AUSTRALIA, 2000

No brokerage or stamp duty is payable by Applicants in respect of their applications for New Options under this Prospectus. The amount payable on acceptance will not vary during the period of the Offer and no further amount is payable on allotment. Acceptance Monies will be held in trust in a subscription account until allotment of the New Options. The subscription account will be established and kept by Verus on behalf of the Applicants. Any interest earned on the Acceptance Monies will be retained by the Company irrespective of whether allotment takes place.

2.5 Allotment and Allocation Policy

Verus will proceed to allocate New Options as soon as possible after the Closing Date and receiving ASX permission for official quotation of the New Options.

In the case that there is less than full subscription by Shareholders to their Entitlements under this Prospectus, the Directors reserve the right to issue any Shortfall in accordance with Sections 2.3 and 6.6 of this Prospectus.

Successful Applicants will be notified in writing of the number of New Options allocated to them as soon as possible following the allocation being made.

It is the responsibility of Applicants to confirm the number of New Options allocated to them prior to trading in New Options. Applicants who sell New Options before they receive notice of the number of New Options allocated to them do so at their own risk. No New Options will be allotted or issued on the basis of this Prospectus later than 13 months after the date of issue of this Prospectus.

2.6 ASX Listing

Within seven (7) Business Days after the date of issue of the Prospectus, Verus intends to apply for the listing and quotation of the New Options on the ASX. If granted, quotation of the New Options will commence as soon as practicable after allotment of the New Options to Applicants. It is the responsibility of the Applicants to determine their allocation of New Options prior to trading.

Should the New Options not be granted official quotation on the ASX within three (3) months after the date of this Prospectus, none of the New Options under this Prospectus will be issued and all acceptance money will be refunded without interest to Applicants within the time prescribed by the Corporations Act.

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2.7 Investment Risks

Investors should carefully read the section on Risk Factors outlined in Section 5. An investment of this kind involves a number of risks, a number of which are specific to Verus and the industry in which it operates.

2.8 CHESS

Verus will apply to the ASX for the New Options to participate in the Securities Clearing House Electronic Subregister System known as CHESS. CHESS is operated by ASTC in accordance with the Listing Rules and the ASTC Settlement Rules. After allotment of the New Options, those who are issuer sponsored holders will receive an issuer sponsored statement and those who are CHESS holders will receive an allotment advice.

The CHESS statements, which are similar in style to bank account statements, will set out the number of New Options and Options allotted to each successful applicant pursuant to this Prospectus. The statement will also advise holders of their holder identification number. Further statements will be provided to holders which reflect any changes in their holding in Verus during a particular month.

2.9 No rights trading

Entitlements to New Options pursuant to the Issue are non-renounceable and accordingly will not be traded on the ASX.

2.10 Minimum Subscription

There is no minimum subscription to the Issue.

2.11 Underwriting

The Issue is not underwritten.

2.12 Overseas Shareholders

The Company has not made investigations as to the regulatory requirements that may prevail in the countries, outside of Australia, in which the Company’s Shareholders reside.

The distribution of this Prospectus in places outside of Australia may be restricted by law and persons who come into possession of this Prospectus should seek advice on and observe those restrictions. Any failure to comply with those restrictions may violate applicable securities laws.

2.13 Electronic Prospectus

An electronic version of this Prospectus is available on the Internet at www.verusinvestments.com.au.

The Entitlement and Acceptance Form may only be distributed attached to a complete and unaltered copy of the Prospectus. The Company will not accept a completed Entitlement and Acceptance Form if it has reason to believe that the investor has not received a complete paper copy or electronic copy of the Prospectus or if it has reason to believe that the Entitlement and Acceptance Form or electronic copy of the Prospectus has been altered or tampered with in any way.

While the Company believes that it is extremely unlikely that in the Issue period the electronic version of the Prospectus will be tampered with or altered in any way, the Company cannot give any absolute assurance that it will not be the case. Any investor in doubt concerning the validity or integrity of an electronic copy of the Prospectus ought immediately request a paper copy of the Prospectus directly from the Company or a financial adviser.

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3. VERUS AND ITS OPERATIONS

3.1 Corporate objective and investment policy

The Company’s principal objective and investment policies, as previously approved by Shareholders, are for the purpose of the growth and maximisation of the value of its equity funds.

In pursuit of this objective, the Directors have been authorised to apply the equity and any debt funds of the Company to investments in their absolute discretion. The Directors continue to implement the Company’s investment policies and in particular to identify a suitable acquisition which may provide Shareholders with participation in the growth and maximisation of the Company’s available equity funds. When this is identified by the Directors, Shareholders will be notified in accordance with the Company’s continuous disclosure obligations and, if required, Shareholder approval of the acquisition sought for the purpose of Listing Rule 11.1.

St Gabriel 1 Well – Investment

On 3 January 2007 the Company announced that it had executed a Master Participation Agreement ( MPA ) with AUS-TEX Exploration, Inc. ( AUS-TEX ) a wholly owned subsidiary of Austin Exploration Limited ( Austin ), a company listed on the ASX.

The MPA facilitated an investment by way of a farm-in by Verus to the St Gabriel I well located in Iberville in onshore South Louisiana, some 8 miles southeast of the state capitol, Baton Rouge, in the onshore Gulf Coast of Louisiana.

A detailed summary of the MPA is set out in Section 6.7 of this Prospectus. The following reflects a summary of the information previously released to ASX by Austin in relation to the St Gabriel 1 well in which Verus has an interest.

On 5 and 8 March 2007, Austin reported to the ASX that the St Gabriel 1 well was halted at 10,292 feet after encountering an abnormally high pressure formation. The high pressure formation was not expected and is considered unusual in the St Gabriel field. As a result the target depth of 10,800 feet, which was designed to test the “W” sands, was not achieved. Although it was mechanically possible to continue drilling the St Gabriel 1 well to target depth an additional string of casing would have been required. Austin’s drilling engineers estimated the cost of drilling the additional 500 feet to target depth at between AU$1.0 million to AU$1.3 million. Drilling risk due to the high pressure would still exist if Austin had proceeded and there would have been no guarantee that target depth would have been reached.

In consideration of this Austin thought it technically and economically prudent to release the drilling rig and begin a thorough review of all of the data acquired during the drilling and ascertain the geological reasons leading to this high pressure formation.

There are a number of options open to the Company and its joint venture partners in respect to the St Gabriel 1 well, these are as follows:

1. Re-enter the existing St Gabriel 1 well at a later date and drill to target depth;

2. Re drill the St Gabriel 1 well from surface utilising a larger drill diameter and setting another casing string from surface. This option will mean that the well will be more expensive to drill but would most probably have a higher degree of success in reaching the “W” formations, but not necessarily guarantee an economic success; or

3. Seek farm-in partners to conduct either 1 or 2 above. This option would dilute the Company’s and its joint venture partner’s equity interest in the St Gabriel 1 well on a pro-rata basis, but would not require any additional funding from the Company.

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In light of the data received from drilling St Gabriel 1 to 10,292 feet Austin will also be reviewing its geological interpretation to ensure that the “W” sand remains a valid target.

As at the date of this prospectus Austin has informed the Company that they are in discussions with a third party in respect to Option 3 above.

In compliance with the MPA, Verus has paid (as at the date of this Prospectus) an aggregate of $US1,590,900 in respect of the St Gabriel 1 well.

Geuymard 1 (previously called St Gabriel II) & S W Edwards Wells – Investments

On the 24 January 2007 the Company announced that it was proceeding with farming into an additional two wells in conjunction with Austin, namely the Gueymard 1 and S W Edwards wells.

The Geuymard 1 Prospect is located in the onshore Gulf Coast Basin of Louisiana.

A detailed summary of the MPA is set out in Section 6.7 of this Prospectus. The following reflects a summary of the information previously released to ASX by Austin in relation to the Geuymard 1 well in which Verus has an interest.

The Geuymard 1 Prospect was identified by a field study, in which several zones which flowed gas and condensate as well as oil, in 1947 were identified. All but one of these zones were considered to be subeconomic and not produced at the time but they would be commercial at today’s hydrocarbon prices. At the current prices they would have been completed for production. It should also be noted that the then operator of the well, Shell, is a major company and the majors are, and were, predominately interested in large discoveries and large flow rates.

The prospect has been generated by interpretation of 3D seismic, sub-surface mapping and a study of the results of the Shell 10 Gueymard well, which is to be re-entered. This study has identified pay zones which were successfully drill stem tested and produced hydrocarbons, both gas and liquids.

Operations commenced to re-enter the Geuymard 1 well on 4 June 2007. On 21 June 2007, Austin announced that the analysis of the Halliburton production log had been completed and 55 feet of pay had been identified in the zones logged above the “P” sands. The targeted “U” and “W” zones could not be logged by re-entering due to an obstruction above the P sand and the poor condition of the casing. To reach the “U” and “W” sands a new well will need to be drilled.

As at the date of this prospectus Verus has not been informed as to the progress of production testing in the sands above the “P” sands. Verus has not been advised of a budget to drill a second well to access the targeted “U” and “W” sands, on receipt of that budget the board of Verus will make a decision as to whether it will participate in the drilling of that well.

In compliance with the MPA, Verus has paid (as at the date of this Prospectus) an aggregate of $US1,591,000 in respect of the Geuymard 1 well.

SW Edwards Prospect

The SW Edwards Creek Prospect is located in the South West Edwards Field in Hinds County some 25 miles south west of the State Capitol, Jackson. The Operator of the well is Flex Energy L.L.C. (Flex) of Lafayette, Louisiana.

A detailed summary of the MPA is set out in Section 6.7 of this Prospectus. The following reflects a summary of the information previously released to ASX by Austin in relation to the SW Edwards well in which Verus has an interest.

The prospect has been mapped up on 2D and 3D seismic data. A stratigraphic cross section, derived from well logs has also been prepared. Electric log analysis and side wall core analysis of data from nearby and existing wells have high graded the prospect.

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SW Edwards Prospect is a re-entry of the existing First Energy Montgomery 29-6 1 well. A study of the results of this well have identified 12ft of by-passed pay in the Rodessa Formation sands. Mapping incorporating new 3D seismic data indicates that the location is structurally high on both the Rodessa Formation and the Sligo Formation, another productive sand in the area. The proposed well will be side tracked from a depth of 7,000ft to intersect the target zones in an up-dip location, approximately 800 ft north west of the surface location. Closure on both the upper and lower Rodessa Formation sands extends over some 670 acres.

The target zones will be intersected approximately 50 ft higher than in the Montgomery 29-6 1 well and some 21 ft of net pay is expected. The Sligo Formation, also productive in the area, will be intersected in a structurally high location.

Operations commenced to re-enter the SW Edwards well on 10 July 2007, on 8 August 2007 Austin advised the Company that the well had reached its target depth and the operator was preparing to begin logging operations for wellbore evaluation.

In compliance with the MPA, Verus has paid (as at the date of this Prospectus) an aggregate of $US846,562 in respect of the SW Edwards well.

Additional Information

A summary of the major activities and financial information relating to the Company for the financial year ended 30 June 2006 is in the Annual Report which was lodged with ASX on 26 October 2006. A summary of activities for the half year ended 31 December 2006 is in the half yearly report lodged with ASX on 14 February 2007. The continuous disclosure notices lodged by the Company also inform shareholders and investors of activities of the Company. A list of all notices given by the Company after lodgment of the 2005 Annual Report is set out in Section 6.1.

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4. EFFECT OF ISSUE ON VERUS

4.1 Use of funds from Offer

It is proposed that the funds raised under the Offer be allocated, assuming full subscription under the Offer, in the following manner:

Proposed use of funds	Amount
Expenses of the Offer	$33,500
Working capital and corporate overheads	$284,892
Total	$318,392

4.2 Financial position

The pro-forma statement of financial position presented below has been prepared in accordance with the draft ASIC Guide to Disclosing Pro Forma Financial Information issued in July 2005. The pro-forma statement of financial position is based on the unaudited management accounts as at 30 June 2007 adjusted net proceeds of the Offer, assuming that the Offer is fully subscribed.

The accounting policies adopted in preparation of the pro-forma statement of financial position are consistent with the policies adopted in the preparation of the 31 December 2006 half-year statement of financial position.

	Un-Audited 30 June 2007	Offer	Pro forma Un-audited 30 June 2007
CURRENT ASSETS
Cash	2,268,723	318,392	2,268,723
Trade and other receivables	27,523	-	27,523
Other – Financial Assets	-	-	-
Other	50,170	-	50,170
TOTAL CURRENT ASSETS	2,346,416	318,392	2,664,808
NON-CURRENT ASSETS
Property, Plant & Equipment	81,684	-	81,684
Investments	5,460,926	-	5,460,926
TOTAL NON-CURRENT ASSETS	5,542,610	-	5,542,610
TOTAL ASSETS	7,889,026	318,392	8,207,418
CURRENT LIABILITIES
Trade and otherpayables	48,223	33,500	81,723
TOTAL LIABILITIES	48,223	33,500	81,723
NET ASSETS	7,840,803	284,892	8,125,695
EQUITY
Contributed Equity	8,824,377	284,892	9,109,269
Reserves	5,850	-	5,850
Accumulated Losses	(989,424)	-	(989,424)
TOTAL EQUITY	7,840,803	284,892	8,125,695

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The Company has previously announced an investment in three oil and gas exploration wells located in Texas and Louisiana (USA) as part of a joint venture with AUS-TEX Exploration, Inc, a wholly owned subsidiary of Austin Exploration Limited a company listed on the ASX.

Verus will be considering the book value of those investments in its accounts once it has received the necessary technical and financial information from AUS-TEX Exploration, Inc.

4.3 Capital Structure

Assuming full subscription under the Prospectus, the share capital structure of Verus immediately following the Issue will be as follows:

Shares	Number
Shares on issue at the date of this Prospectus	238,794,160
Total	238,794,160
Options	Number
Options on issue at the date of this Prospectus	Nil
Options on issue at the completion of this Offer	159,196,107
Total	159,196,107

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5. RISK FACTORS

5.1 Introduction

Activities of Verus, as in any business, are subject to risks which may impact on its future performance. Verus has appropriate actions, systems and safeguards for known risks however, some are outside its control. The principal risk factors are described below.

You should carefully consider the risks and uncertainties set out below and the information contained elsewhere in this Prospectus before you decide whether to accept New Options.

5.2 General Risks

An investment in the New Options should be considered speculative due to the nature of the mining and exploration industry generally. Mining and exploration involve many risks, which even a combination of experience, knowledge and careful evaluation may not be able to overcome. There can be no assurance that Verus management will be able to overcome these risks.

Additionally, the Company’s success in acquiring an interest in businesses or investments is subject to the Company being able to locate a suitable investment or investments, conduct appropriate due diligence and negotiate acceptable acquisition terms. There is no guarantee that the Company’s search will ultimately be successful in its endeavour.

5.3 Share Price Fluctuations

The market price of the Company’s Shares will be subject to varied and often unpredictable influences in the share market. Both domestic and world economic conditions may affect the performance of the Company. Factors such as the level of industrial production, inflation and interest rates impact all global equity markets including ASX.

5.4 Management Actions

The Directors of the Company will, to the best of their knowledge, experience and ability (in conjunction with their management) endeavour to anticipate, identify and manage the risks inherent in the activities of the Company, but without assuming any personal liability for same, with the aim of eliminating, avoiding and mitigating the impact of risks on the performance of the Company and its securities.

5.5 Government Policy

Changes in relevant taxation, interest rates, other legal, legislative and administrative regimes, and Government policies in Australia, may have an adverse affect on the assets, operations and ultimately the financial performance of the Company and the market price of its securities.

5.6 Financing

In order to expand its activities the Company will be required to raise additional equity or debt capital in the future. There is no assurance that it will be able to raise capital when it is required or that the terms associated with providing such capital will be satisfactory to the Company.

5.7 Insurance Arrangements

The Company intends to maintain insurance within ranges of coverage the Company believes to be consistent with industry practice and having regard to the nature of activities being conducted. No assurance however, can be given that the Company will be able to obtain such insurance coverage at reasonable rates or that any coverage it arranges will be adequate and available to cover any such claims.

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5.8 General Economic Conditions

Any prolonged economic slowdown of the Australian economy as well as fluctuations between the Australian dollar and the currency of countries in which the Company will have operations, may have an adverse impact on financial performance of the Company.

5.9 Contractual arrangements

The Company may be required to rely upon third parties to supply services and infrastructure to it in order to conduct its operations. The supply of those services and infrastructure may be critical to the ongoing operation and development of the Company’s interests. The financial failure, insolvency, management failure or other default of any party under those contractual arrangements may adversely affect the Company’s operations and the financial performance of the Company generally.

5.10 Acquisition policy

The Directors continue to take steps to identify a suitable acquisition which is consistent with the Company’s investment strategy to provide shareholders with participation in the growth and maximisation of the Company’s available equity funds. However, at the date of this Prospectus, a suitable acquisition has not been identified.

5.11 Operating Hazards

The Company has made several investments in the oil and gas industry and there is a risk that no commercially productive reservoirs will be located. There can be no assurance that the new wells drilled will be productive or that all or any portion of a project investment will be recovered. Drilling may also result in unprofitable efforts where productive wells do not produce sufficient net revenues to return a profit after drilling, operating and other costs.

The cost and timing of drilling, completing and operating wells is often uncertain. Drilling operations may be delayed or cancelled due to numerous uncontrollable factors beyond the Company’s control including titling problems, weather conditions, delays by project participants, regulatory compliance issues, shortages and delays related to equipment and services and increased costs of such equipment and services.

Drilling, producing and transporting oil and natural gas involves a number of inherent risks including fires, natural disasters, explosions encountering formations with abnormal pressures, blowouts, cratering, pipeline ruptures and spills. These risks can result in the loss of hydrocarbons, environmental pollution, personal injury claims and damage to property.

5.12

Movement in exchange rates

The value or sale price of oil and gas that may be produced by the Company will expose the income of the Company to the effects of the change in currency (exchange rate) risk.

The international price of oil is dominated in US dollars, whereas the income and some expenditure of the Company will be accounted for in Australian dollars. The revenues of the Company will be exposed to the fluctuations and volatility of the price of oil and gas and the rate of exchange between the US Dollar and the Australian Dollar, as determined in international markets.

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5.13 Unforeseen Expenses

While the Company is not aware of any expenses that may need to be incurred that have not been taken into account, if such expenses were subsequently incurred, the expenditure proposals of the Company may be adversely affected.

Neither the Company nor the Directors warrant the future performance of the Company or any return on an investment in the Company. In addition, the Company’s ability to raise additional capital, should it be required, may be affected.

There can be no guarantee that the assumptions on which the Company, or those upon which the Company bases its decisions to proceed, will ultimately prove to be valid or accurate. The Company’s forecasts, and development strategies depend on various factors many of which are outside the control of the Company.

The future viability and profitability of the Company is also dependent on a number of other factors affecting performance of all industries, including, but not limited to the following:

• strength of equity and capital markets in Australia and throughout the world;

• changes in government, monetary policies, taxation and other laws can have a significant influence on the outlook for companies and the returns to investors; and

• industrial disputation in Australia or in other markets in which the Company invests.

The above list of risk factors ought not to be taken as exhaustive of the risks faced by the Company or by investors in the Company. The above factors, and others not specifically referred to above, may in the future materially affect the financial performance of the Company and the value of the Shares. Therefore, the Options to be issued pursuant to the Prospectus and the Shares into which they convert on exercise, carry no guarantee with respect to the payment of dividends, returns of capital or the market value of those shares.

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6. ADDITIONAL INFORMATION

6.1 Transaction Specific Prospectus

Verus is a disclosing entity and therefore subject to regular reporting and disclosure obligations under the Corporations Act. Under those obligations, Verus is obliged to comply with all applicable continuous disclosure and reporting requirements in the Listing Rules.

This Prospectus is issued under Section 713 of the Corporations Act. This section enables disclosing entities to issue a prospectus in relation to securities in a class of securities which has been quoted by ASX at all times during the 3 months before the date of the Prospectus or options to acquire such securities. Apart from formal matters, this Prospectus need only contain information relating to the terms and conditions of the Offer, the effect of the Offer on the Company, the rights and liabilities attaching to the New Options and the rights and liabilities attaching to Shares.

The Corporations Act requires Verus as a disclosing entity, to comply with the reporting and disclosure obligations of the Listing Rules and makes it an offence for Verus not to comply in certain circumstances. In addition, the Corporations Act requires Verus, as a disclosing entity, to comply with the accounting and financial reporting requirements of the Corporations Act for the half-year and full-year accounting periods. These financial statements, together with a Directors' statement and report and an audit or review report must be lodged with the ASIC.

Copies of the documents lodged by Verus with ASIC may be obtained from, or inspected at an office of ASIC.

The Company will provide a copy of any of the following documents, free of charge, to any person who asks for a copy of the document before the Closing Date in relation to this Prospectus:

• audited financial statements for the Company for the year ended 30 June 2006;

• half-yearly financial statements for the Company for the period ending 31 December 2006; and

• • any continuous disclosure notices given by Verus to ASX, in the period starting immediately after lodgement of the annual financial statements of Verus and ending on the date of lodgement of this Prospectus with ASIC being the following announcements:

Date	Item
08/08/2007 02/07/2007 29/06/2007 25/06/2007 25/06/2007 21/06/2007 19/06/2007 19/06/2007 15/06/2007 14/06/2007 13/06/2007	Target Depth reached at Southwest Edwards well Change in substantial holding AKK: Southwest Edwards Rig Moving In Details of Registered office address Initial Director's Interest Notice 2 AKK: 55 Feet of Pay Discovered at Aus-Tex Gueymard #1 Options Rights Issue 1 AKK ann: Aus-Tex Gueymard 1 Logs Complete Director Appointment AKK: Aus-Tex Gueymard #1 Update Change in substantial holding

• 15 -

12/06/2007 AKK ann: Aus-Tex Gueymard #1 Update 04/06/2007 Gueymard No.1 - Progress Report 01/06/2007 Becoming a substantial holder 29/05/2007 Ceasing to be a substantial holder 25/05/2007 Change in Directors 25/05/2007 Response to ASX Query 23/05/2007 Ceasing to be a substantial holder 23/05/2007 Change of Director's Interest Notice 22/05/2007 Change of Director's Interest Notice 22/05/2007 Change of Director's Interest Notice 22/05/2007 Ceasing to be a substantial holder 18/05/2007 AKK ann: Update on Projects in USA 10/04/2007 AKK ann: Site Works Commenced 08/03/2007 AKK ann: St Gabriel I Update 05/03/2007 AKK ann: Drilling update 26/02/2007 AKK: Drilling Update 19/02/2007 AKK ann:Drilling update - St Gabriel 1 & Yorketown prospect 14/02/2007 Half Yearly Report & Half Year Accounts 06/02/2007 Change in Substantial Holding 24/01/2007 AKK: Confirms Verus Investment 24/01/2007 Oil & Gas Farm-In 03/01/2007 Farm In Agreement 29/11/2006 Results of Meeting 23/11/2006 Final Director’s Interest Notice 23/11/2006 Director Resignation 22/11/2006 Shareholder Update 22/11/2006 Reinstatement to Official Quotation 16/11/2006 Suspension for Official Quotation 14/11/2006 Trading Halt 26/10/2006 Annual Report

• 16 -

6.2 Rights and liabilities attaching to Shares

The rights attaching to ownership of the Shares (issued upon the exercise of the New Options) are set out in the Company’s Constitution, a copy of which is available for inspection at the registered office of the Company during business hours. The following is a summary of the principal rights of holders of the Shares, subject to any special rights attaching to any class of share at a future time. This summary is not exhaustive nor does it constitute a definitive statement of the rights and liabilities of the Company’s Shareholders.

• Voting

At a general meeting of the Company:

• (a) on a show of hands - every Shareholder present in person or by proxy, attorney or representative has one (1) vote; and

• (b) on a poll - every Shareholder present has:

• (i) one (1) vote for each fully paid Security held by them and in respect of which they are entitled to vote; and

• (ii) a fraction of a vote for each partly paid Security held by them and in respect of which they are entitled to vote.

• Dividends

The Shares will rank equally with all other issued shares in the capital of the Company and will participate in dividends out of profits earned by the Company from time to time. Subject to any rights or restrictions attached to any Securities or class of Securities, all dividends in respect of Securities will be paid to Shareholders in proportion to the number of Securities held by them. However, where Securities are partly paid all dividends will be apportioned and paid proportionately to the amounts paid (not credited) on the Securities. The Directors may pay to Shareholders any interim and final dividends as, in their judgment, the financial position of the Company justifies.

• Transfer of the Shares

Subject to the Company’s constitution and to the rights or restrictions attached to any class of Securities, a transfer of Securities may be effected by:

• (a) a proper ASTC transfers; or

• (b) an instrument in writing in any usual form or in any other form that the directors approve.

No fee shall be charged by the Company on the transfer of any Securities.

Refusal to Register

If permitted by the Listing Rules, the Directors may decline to register a transfer of Securities.

• Winding up

Following the exercise of New Options and payment of the exercise price Shareholders will have no further liability to make payments to the Company in the event of the Company being wound up pursuant to the provisions of the Corporations Act.

• 17 -

• Future increases in Capital

The allotment and issue of any Securities is under the control of the Directors. Subject to the Listing Rules, the Company’s Constitution and the Corporations Act, the Directors may allot or otherwise dispose of Securities on such terms and conditions as they see fit.

• Variation of Rights

At present, the Company has only ordinary shares on issue.

If the shares of another class were issued, the rights attaching to ordinary shares could only be altered with:

• (a) the sanction of a special resolution passed at a separate meeting of the holders of ordinary shares; or

• (b) the written consent of the holders of at least three quarters of the ordinary shares.

• General Meeting

Each Shareholder will be entitled to receive notice of and to attend and vote at general meetings of the Company and to receive notices, accounts and other documents required to be furnished to Shareholders under the Company’s Constitution, the Corporations Act and the Listing Rules.

For more particular details of the rights attaching to Securities in the Company, investors should refer to the Constitution of the Company.

6.3 Rights Attaching to Options

The New Options will be issued with the following terms and conditions:

• a. Each Option entitles the holder to subscribe for and be allotted one Share. The exercise price of each Option is $0.10.

• b. The Options are exercisable at any time prior to 5.00pm AEST on 30 June 2010 ( the Expiry Date ) by notice in writing to the Company accompanied by payment of the exercise price as detailed in (a) above.

• c. The Options are transferable and an application will be made to the ASX for Official Quotation of the Options.

• d. Shares allotted and issued pursuant to the exercise of an Option will be allotted and issued not more than 10 Business Days after receipt of a properly executed notice of exercise of the Option and payment of the requisite application moneys.

• e. All Shares issued upon exercise of the Options will rank pari passu in all respects with the Company's fully paid ordinary shares. The Company will apply for Official Quotation by ASX of all Shares issued upon exercise of the Options within three Business Days after the date of allotment of those Shares.

• f. There are no participating rights or entitlements inherent in the Options and holders will not be entitled to participate in new issues of capital offered or made to shareholders during the currency of the Options. However, the Company will send a notice to each option holder at least nine Business Days before the record date for any proposed issue of capital on a pro-rata entitlement basis. This will give Option holders the opportunity to exercise their Options prior to the date for determining entitlements to participate in any such issue.

• 18 -

• g. There are no rights to a change in exercise price, or in the number of Shares over which the Options can be exercised, in the event of a bonus issue by the Company prior to the exercise of any Options.

• h. In the event of any reorganisation of the issued capital of the Company on or prior to the Expiry Date, the rights of an Option holder will be changed to the extent necessary to comply with the applicable ASX Listing Rules at the time of the reorganisation.

• i. The Company will, at least 20 Business Days before the Expiry Date, send notices to the Option holders stating the name of the Option holder, the number of Options held and the number of securities to be issued on exercise of the Options, the exercise price, the due date for payment and the consequences of non-payment.

• j. Option holders do not participate in any dividends unless the Options are exercised and the resultant shares of the Company are issued prior to the record date to determine entitlements to the dividend.

• k. The terms of the Options shall only be changed if holders (whose votes are not to be disregarded) of ordinary Shares in the Company approve of such a change. However, the terms of the Options shall not be changed to reduce the Exercise Price, increase the number of Options or change any period for exercise of the Options.

6.4 Trading prices of Shares on ASX

The highest and lowest closing market sale prices of Shares in the Company on ASX in the 6 month period immediately prior to the date of lodgement of this Prospectus and the last available closing market sale price on ASX before the date of this Prospectus and the respective dates of those sales were:

Highest: $0.135 on 13 July 2007 Lowest: $0.036 on 12 April 2007 Last: $0.09 on 8 August 2007

6.5 Directors’ Interests

The nature and extent of the interest (if any) that any of the Directors of the Company holds, or held at any time during the last 2 years in:

• (a) The formation or promotion of the Company;

• (b) Property acquired or to be acquired by the company in connection with:

• (i) its formation or promotion; or

• (ii) the Offer; or

• (c) The Offer,

is set out below.

Other than as set out below or elsewhere in this Prospectus, no one has paid or agreed to pay any amount, and no one has given or agreed to give any benefit to any director or proposed director:

• (a) to induce them to become, or to qualify as, a Director of the Company; or

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• (b) for services provided by a director in connection with:

• (i) the formation or promotion of the Company; or

• (ii) the Offer.

Set out below are details of the interests of the Directors in the securities of the Company immediately prior to lodgement of the Prospectus with the ASIC. Interests include those securities held directly and indirectly. The table takes into account New Options the directors may acquire under the Offer.

Director	Number of Shares	Number of Options Entitlement
Mr Dean Gallegos Mr Simon Fyfe Mr Gregory Lee Mr David Calcei	10,000,000 2,785,480 1,000,000 Nil	6,666,666 1,856,987 666,666 Nil

Work undertaken by Directors of the Company other than in their capacity as Directors is paid by such remuneration (if any) as determined by the board commensurate with their level of experience and work undertaken. All amounts that have been paid or agreed to be paid to Directors of Verus since the end of the financial year ending 30 June 2006 are as follows:

Name	Salary / Fees
	$
Mr Dean Gallegos	$120,000 p.a
Mr Simon Fyfe	$48,000 p.a
Mr Gregory Lee	$24,000 p.a
Mr David Calcei	$24,000 p.a

Details of the amounts paid to Directors of the Company for the financial years ended 30 June 2006 and 30 June 2005 are set out in the Company’s Annual Report for the financial year ended 30 June 2006.

6.6 Technical Consultancy Services

Verus has entered into a Technical Consultancy Agreement with Corporate & Resource Consultants Pty Ltd ( the Consultant ).

Verus is not required to pay any retainer to the Consultant for services provided under the Technical Consultancy Agreement. Under the Agreement, the Company has granted to the Consultant a first right of refusal to subscribe to any part or the entire Shortfall that may arise from the Offer to Shareholders.

As part of this arrangement with the Consultant, it has been agreed the following actions will take place:

• a. Verus will give written notice of the Shortfall to the Consultant on the first Business Day after the Closing Date of the Offer;

• b. Within 2 Business Days after the notice referred to above, the Consultant will provide written advice indicating the extent to which the Consultant will subscribe to the Shortfall;

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• c. Within 2 Business Days after the notice from the Consultant referred to in (b) above, the Consultant will settle the subscription of the Shortfall to the extent indicated in the notice referred to in (b) above.

Any Options issued to the Consultant upon exercise of the rights granted under the Technical Consultancy Agreement will be issued under this Prospectus.

The Technical Consultancy Agreement is not an underwriting agreement and as such, the Consultant is entitled to elect whether to subscribe for any of the Shortfall, and if so, for how much of it to subscribe for.

In compliance with the Listing Rules, any Options to be issued pursuant to the Technical Consultancy Agreement will be issued within 3 months after the Closing Date.

6.7 Master Participation Agreement

The Company entered into a Master Participation Agreement ( MPA ) with AUS-TEX Exploration, Inc. ( AUS-TEX ), a wholly owned subsidiary of Austin Exploration Limited (a company listed on the ASX), on 22 December 2006.

The requirements for the Company to obtain a percentage working interest in a number of exploration prospects are set out below.

St Gabriel Prospect I (SGPI)

In order for the Company to obtain a 12.5% working interest in the SGPI, the Company must pay to AUSTEX US$1,590,900 comprising:

• (a) 200% of all costs (including land, legal, fees, permits, drilling, completion or plygging and abandoning) associated with the SGPI working interest estimated to be US$1,215,900;

• (b) a US$350,000 land, geological and geophysical fee; and

• (c) a US$25,000 prospect fee relating to the SGPI working interest.

Upon assignment of the working interest in SGPI, the Company will be obliged to pay all costs attributable to its percentage interest in SGPI.

The MPA provides that SGPI is burdened with aggregate royalties of 25% which would result in the Company obtaining a net revenue interest of 9.375%. It is also noted that Rio Bravo Energy Partners, LLC has a reversionary 20% working interest which would have the effect of reducing the Company’s working interest to 10% and net revenue interest to 7.5% (before deduction of broker fees).

Geuymard I Prospect (formally St Gabriel Prospect II) (GIP)

In order for the Company to obtain a 25% working interest in the GIP, the Company must pay to AUS-TEX US$1,591,000 comprising:

• (a) 200% of all costs (including land, legal, fees, permits, drilling, completion or plugging and abandoning) associated with the GIP working interest estimated to be US$1,491,000;

• (b) a US$75,000 land, geological and geophysical fee; and

• (c) a US$25,000 prospect fee related to the GIP working interest.

Upon assignment of the working interest in GIP, the Company will be obliged to pay all costs attributable to its percentage interest in GIP.

• 21 -

The MPA provides that GIP is burdened with aggregate royalties of 25% which would result in the Company obtaining a net revenue interest of 18.75%. It is also noted that Rio Bravo Energy Partners, LLC has a reversionary 20% working interest which would have the effect of reducing the Company’s working interest to 20% and net revenue interest to 15% (before deduction of broker fees).

SW Edwards Prospect (SWEP)

In order for the Company to obtain a 12.5% working interest in the SWEP, the Company must pay AUSTEX US$1,051,250 comprising:

• (a) 200% of all costs (including land, legal, fees, permits, drilling, completion or plugging and abandoning) associated with SWEP working interest which was estimated to be US$846,562;

• (b) a US$179,688 land, geological and geophysical fee; and

• (c) a US$25,000 prospect fee related to the SWEP working interest.

Upon assignment of the working interest in SWEP, the Company will be obliged to pay all costs attributable to its percentage interest in SWEP.

The MPA provides that SWEP is burdened with aggregate royalties of 24% which would result in the Company obtaining a net revenue interest of 9.5% (before deduction of broker fees).

Brokers fee

Under the MPA, the Company is obliged to pay a broker fee equal to 1% of the Company’s net revenue interest related to each prospect. This would have the effect of reducing the Company’s net revenue interest in each prospect to:

• (a) SGPI – 7.425%;

• (b) GIP – 14.85%; and

• (c) SWEP – 9.405%.

Default

If the Company fails to make timely payments of the amounts required to be paid to obtain its percentage working interest in the above prospects, the Company will forfeit all its rights under the MPA in respect of the prospect for which payment was delayed.

Indemnity

The MPA contains an indemnity against the Company’s proportionate share in favour of AUS-TEX in relation to any claim or liability to any third party in connection with loss or damage resulting from any act or omission of AUS-TEX in connection with the prospects.

Warranties

The MPA includes warranties in favour of the Company as to AUS-TEX’s ownership of the working interests, its rights to assign the working interests, the legality and binding nature of the MPA and other standard warranties typical for an agreement of this nature.

The MPA also includes warranties in favour of AUS-TEX as to the Company’s right to acquire the percentage working interests, the legality and binding nature of the MPA, its ability to perform its obligations under the MPA and other standard warranties typical for an agreement of this nature.

• 22 -

6.8 Limitation on Foreign Ownership

The only limitations under Australian law on the rights of non-Australian residents to hold or vote the shares of an Australian company are set forth in the Foreign Acquisitions and Takeovers Act (the FATA ). The FATA regulates acquisitions giving rise to ownership of substantial amounts of a company's shares. The FATA prohibits:

• any natural person not ordinarily resident in Australia; or

• any corporation in which either a natural person not ordinarily resident in Australia or a foreign corporation (as defined in the FATA) holds a substantial interest (defined below); or

• two or more such persons or corporations which hold an aggregate substantial interest (defined below),

from entering into an agreement to acquire shares if after the acquisition such person or corporation would hold a substantial interest in a corporation, without first applying in the prescribed form for approval thereof by the Australian Treasurer and receiving such approval or receiving no response in the 40 days after such application was made.

A holder will be deemed to hold a substantial interest in a corporation if the holder alone or together with any associates (as defined in the FATA) is in a position to control not less than 15% of the voting power in the corporation or holds interests in not less than 15% of the issued shares in that corporation. Two or more holders hold an aggregate substantial interest in a corporation if they, together with any associates (as so defined), are in a position to control not less than 40% of the voting power in that corporation or hold not less than 40% of the issued shares in that corporation.

The Constitution of the Company contains no limitations on a non-resident's right to hold or vote the Company's Shares.

6.9 Subsequent Events

There has not arisen, at the date of this Prospectus any item, transaction or event of a material or unusual nature not already disclosed in this Prospectus which is likely, in the opinion of the Directors of the Company to affect substantially:

• the operations of the Company,

• the results of those operations; or

• the state of affairs of the Company.

6.10 Litigation

The Company is not engaged in any litigation which has or would be likely to have a material adverse effect on either the Company or its business.

6.11 Interests of Experts and Advisers

This section applies to persons named in this Prospectus as performing a function in a professional, advisory or other capacity in connection with the preparation or distribution of this Prospectus, promoters of the Company and stockbrokers or arrangers (but not sub-underwriters) to the Offer (collectively Prescribed Persons ).

• 23 -

Other than as set out below or elsewhere in this Prospectus, no Prescribed Person has, or has had in the last 2 years, any interest in:

• the formation or promotion of the Company;

• any property acquired or proposed to be acquired in connection with the formation or promotion of the Company or the Offer; or

• the Offer of New Options under this Prospectus.

Other than that as set out below or elsewhere in this Prospectus, no benefit has been given or agreed to be given to any Prescribed Person for services provided by a Prescribed Person in connection with the:

• formation or promotion of the Company; or

• Offer of New Options under this Prospectus.

Corporate & Resource Consultants Pty Ltd is acting as a technical consultant to the company. The arrangements with the Company are set out in Section 6.6 above. They do not make any statement in this Prospectus.

Hopgood Ganim Lawyers has acted as solicitors to the Offer and has performed work in relation to the Prospectus and in relation to preparing the due diligence and verification program and performing due diligence required on legal matters, however, they do not make any statement in this Prospectus. In respect of this work, the Company estimates that it will pay approximately $17,500 (excluding disbursements and GST) to Hopgood Ganim Lawyers. Further amounts may be paid to Hopgood Ganim Lawyers in accordance with its normal time based charges.

6.12 Expenses of the Offer

All expenses connected with the Offer are being borne by the Company. Total expenses of the Offer are estimated to be in the order of $33,500.

6.13 Consents and Disclaimers

Written consents to the issue of this Prospectus have been given and at the time of this Prospectus have not been withdrawn by the following parties:

Computershare Investor Services Pty Ltd has given and has not withdrawn its consent to be named in this Prospectus as the share registry of the Company in the form and context in which it is named. It has had no involvement in the preparation of any part of this Prospectus other than recording its name as share registrar to the Company. It takes no responsibility for any part of the Prospectus other than the references to its name.

Corporate & Resource Consultants Pty Ltd has given and has not withdrawn its consent to be named in this Prospectus as a Technical Consultant in the form and context in which it is named. It takes no responsibility for any part of the Prospectus other than references to its name.

Hopgood Ganim Lawyers has given and has not withdrawn its consent to be named in this Prospectus as lawyers to the Offer in the form and context in which it is named. It takes no responsibility for any part of the Prospectus other than references to its name.

• 24 -

6.14 Directors’ Statement

This Prospectus is issued by Verus Investments Limited. Each Director has consented to the lodgement of the Prospectus with ASIC.

Signed on the date of this Prospectus on behalf of Verus Investments Limited by

==> picture [150 x 65] intentionally omitted <==

Mr Dean Lloyd Gallegos Chairman

• 25 -

7. DEFINITIONS & GLOSSARY

Terms and abbreviations used in this Prospectus have the following meaning:

Acceptance An acceptance of Entitlements

Acceptance Monies The Issue Price multiplied by the number of New Options accepted

Applicant A person who submits an Entitlement and Acceptance Form

ASIC Australian Securities & Investments Commission

ASTC ASX Settlement and Transfer Corporation Pty Limited

ASX ASX Limited

ASX Approval The ASX agreeing to quoting of the New Options issued under this Prospectus on the official list of the ASX Board The board of directors of Verus

Business Day A day, other than a Saturday or Sunday, on which banks are open for general banking business in Sydney

Closing Date The date by which valid acceptances must be received by the Share Registrar being 12 September 2007 or such other date determined by the Board Company or Verus Verus Investments Limited ABN 59 009 575 035 Constitution The Constitution of the Company Consultant Corporate & Resource Consultants ABN 59 610 857 130 (see Corporate Directory)

Corporations Act Corporations Act 2001 (Cth) Directors or Board Eligible Participant

The board of directors of Verus from time to time

A shareholder of the Company that holds shares in the Company on the Record Date

Entitlement and Acceptance Form or Form

An entitlement and acceptance form in the form attached to this Prospectus

Entitlements

The entitlement to accept New Options under this Prospectus

• 26 -

Existing Options	All existing options to subscribe for Shares currently on issue as at
	the date of this Prospectus
Hard Copy Prospectus	Paper version of this Prospectus
Issue or Offer	The issue of New Options in accordance with this Prospectus
Issue Price	$0.002 for each New Option applied for
Law	The Corporations Act or any relevant and applicable law in
Australia
Listing Rules	The official listing rules of the ASX
Material Contracts	The material agreements referred to in this Prospectus
New Option	An option to subscribe for an ordinary share in Verus exercisable at
	$0.10 each on or before 30 June 2010 to be issued under this
	Prospectus
Official List	The official list of entities that ASX has admitted and not removed
Official Quotation	Quotation on the Official List
Online Prospectus	The electronic version of this Prospectus which can be viewed at
	www.verusinvestments.com.au.
Opening Date	The date of commencement of the Offer in respect of the
	Preference Shares, expected to be 23 August 2007
Option Holders	The holders of the Existing Options
Options	Options on issue in Verus from time to time
Prospectus	This prospectus dated 9 August 2007 as modified or varied by any
	supplementary prospectus made by the Company and lodged with
	the ASIC from time to time and any electronic copy of this
	prospectus and supplementary prospectus
Record Date	23 August 2007
Register	Company register of Verus
Securities	Has the same meaning as in Section 92 of the Corporations Act
Share Registry	Computershare Investor Services Pty Limited

Shares The ordinary shares on issue in Verus from time to time

• 27 -

Shareholders

Shortfall

The holders of Shares from time to time Those New Options for which the Entitlement lapses

• 28 -

CORPORATE DIRECTORY

Directors Mr Dean Gallegos (Executive Chairman) Mr Simon Fyfe (Non-executive Director) Mr Gregory Lee (Non-executive Director) Mr David Calcei (Non-executive Director)

Administration and Registered Office

Level 15, 25 Bligh Street SYDNEY NSW 2000

Telephone: 02 9233 2520 Facsimile: 02 9233 2530

Solicitors to the Offer Auditors Hopgood Ganim Lawyers Deloitte Touche Tohmatsu Level 8 Waterfront Place Grovenor Place 1 Eagle Street 225 George Street Brisbane QLD 4000 SYDNEY 2000 Consultant Share Registry Corporate & Resource Computershare Investor Consultants Pty Ltd ACN 073 Services Pty Limited 232 318 30 Ledger Road Level 2, 60 Carrington Street Balcatta WA 6021 Sydney NSW 2000 GPO Box 7115 SYDNEY NSW 2001 Telephone: 1300 855 080

1556060_1

• 29 -

Verus Investments Limited

ABN 59 009 575 035

Please return completed form to: Computershare Investor Services Pty Limited GPO Box 52 Melbourne Victoria 8060 Australia Enquiries (within Australia) 1300 850 505 (outside Australia) 61 3 9415 4000 Facsimile 61 3 9473 2500 web.queries@computershare.com.au www.computershare.com

Securityholder Reference Number (SRN)

Use a black pen. Print in CAPITAL letters A B C 1 2 3 inside the grey areas.

Entitlement and Acceptance Form

Non-Renounceable Entitlement Issue closing 5pm (Sydney Time) on 12 September 2007

Non-Renounceable Entitlement Issue on the basis of 2 New Options exerciseable at $0.10 on or before 30 June 2010 at an issue price of $0.002 each for every 3 Shares at the record date 23 August 2007.

Important:

• This document is of value and requires your immediate attention. If you do not understand it, or are in doubt as to how to deal with it, you should consult your accountant, stockbroker, solicitor or other professional adviser immediately.

• This Entitlement and Acceptance Form should not be relied upon as evidence of the current entitlement of the person named in this Entitlement and Acceptance Form.

• Receipt of this form by 5pm (Sydney Time) on 12 September 2007 with your payment will constitute acceptance in accordance with the terms of the Prospectus dated 09 August 2007.

A Securityholder Entitlement details Subregister Existing Shareholders entitled to participate at Record Date on 23 August 2007 Entitlement to New Options on a 2 for 3 basis, exerciseable at A$0.10 per New Option Entitlement Number

To be completed by securityholder

Entitlement Number:

==> picture [522 x 75] intentionally omitted <==

----- Start of picture text -----

B Number of New Options Accepted C Amount enclosed at A$0.002 per New Option
.
A$
I/We enclose my/our payment for the amount shown above being payment of A$0.002 per New Option. I/We hereby authorise you to register me/us as the holder(s)
of the Options allotted to me/us, and I/we agree to be bound by the Constitution of Verus Investments limited.
----- End of picture text -----

==> picture [522 x 51] intentionally omitted <==

----- Start of picture text -----

D Payment Details
Drawer Cheque Number BSB Number Account Number Amount of cheque
A
$
----- End of picture text -----

Make your cheque or bank draft payable to Verus Investments Limited – Entitlement Offer

E Enter your contact details Contact Name Telephone Number - Business Hours /After Hours ( )

The directors reserve the right to make amendments to this form where appropriate. Please refer to the lodgement instructions overleaf.

This form may not be used to effect an address change. Please contact Computershare Investor Services Pty Limited on 1300 850 505 for an appropriate form, or download a Change of Address Notification form from www.computershare.com.

See back of form for completion guidelines

A S X A A A S X A A A 1 N R

16/06/04

How to complete the Entitlement and Acceptance form

Please complete all relevant sections of the Entitlement and Acceptance Form using BLOCK LETTERS in black ink. Note that photocopies will not be accepted. These instructions are cross-referenced to each section of the Entitlement and Acceptance Form.

• A Details of your Entitlement based on your Securityholding at 5pm Sydney Time on 23 August 2007 are shown in box A on the front of this Entitlement Form.

B New Securities Accepted

You can apply to accept either all, or part of, your Entitlement. Enter in box B the number of New Options you wish to accept from your Entitlement.

• To accept your Entitlement in full, write in box B the number of New Options shown in box A as your Entitlement.

• To accept part of your Entitlement only, write in box B the number of New Options for which you wish to apply.

C Acceptance Monies

D Payment Details

Make your cheque or bank draft payable to Verus Investments Limited – Entitlement Offer in Australian currency and cross it Your cheque or bank draft must be drawn on an Australian Bank. Complete the cheque details in the boxes provided. The total amount must agree with the amount shown in box C.

Cheques will be processed on the day of receipt and as such, sufficient cleared funds must be held in your account as cheques returned unpaid may not be re-presented and may result in your Acceptance being rejected. Pin (do not staple) your cheque(s) to the Entitlement and Acceptance Form where indicated. Cash will not be accepted. Receipt for payment will not be forwarded .

Enter the amount of Acceptance Monies. To calculate the amount Contact Details payable, multiply the number of New Options applied for by the E issue price. Enter your contact details. These are not compulsory but will assist us if we need to contact you.

Lodgement of Acceptance

Acceptance Forms must be received at the Sydney office of Computershare Investor Services Pty Limited by no later than 5pm Sydney Time on 12 September 2007. Return the Acceptance Form with cheque(s) attached to:

Verus Investments Limited

C/-Computershare Investor Services Pty Limited Level 2, 60 Carrington Street Sydney NSW 2000

Privacy Statement

Personal information is collected on this form by Computershare Investor Services Pty Limited ("CIS"), as registrar for securities issuers ("the issuer"), for the purpose of maintaining registers of securityholders, facilitating distribution payments and other corporate actions and communications. Your personal information may be disclosed to our related bodies corporate, to external service companies such as print or mail service providers, or as otherwise required or permitted by law. If you would like details of your personal information held by CIS, or you would like to correct information that is inaccurate, incorrect or out of date, please contact CIS. In accordance with the Corporations Act 2001, you may be sent material (including marketing material) approved by the issuer in addition to general corporate communications. You may elect not to receive marketing material by contacting CIS. You can contact CIS using the details provided on the front of this form or E-mail privacy@computershare.com.au

If you have any enquiries concerning your entitlement, please contact Computershare Investor Services Pty Limited on 1300 850 505.

Please return the completed form in the envelope provided or to the address opposite:

Computershare Investor Services Pty Limited Level 2, 60 Carrington Street, Sydney NSW 2000