ELEMENTOS LIMITED — Capital/Financing Update 2017

Jul 3, 2017

4 July 2017

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Mr Richard Boyer & Mrs Lorraine Boyer C/- Calliva Wealth Pty Ltd PO Box N316 GROSVENOR PLACE NSW 1220

Dear Shareholder

Elementos Limited ACN 138 468 756 Non-renounceable rights issue - notice to security holders

Elementos Limited ( Elementos ) is pleased to announce a non-renounceable rights issue to eligible shareholders, on the basis of 1 new fully paid ordinary shares for every 4 shares held, at an issue price of $0.006 per share ( New Shares ), to raise approximately $1,423,947, based on Elementos’s undiluted share capital ( Rights Issue ). Assuming no existing options on issue in the Company are exercised, approximately 237,324,456 fully paid ordinary shares will be offered under the Rights Issue.

This is following the Company’s announcement on Thursday 29 June 2017 of a private placement to sophisticated investors of 100,000,000 Shares and 100,000,000 Options on the same terms as the New Shares and New Options raising $600,000 before costs ( Placement ), including $480,000 from ASX listed Jervois Limited.

The Rights Issue will be available to all registered shareholders who hold shares on Thursday, 6 July 2017 ( Record Date ) with registered addresses in Australia and New Zealand ( Eligible Shareholders ).

In accordance with the Listing Rules of the ASX, Elementos has considered the number of shareholders with registered addresses in various jurisdictions outside of Australia and New Zealand and the size of the shareholdings held by those shareholders. Taking this into consideration, as well as the costs of complying with the legal requirements and the requirements of the regulatory authorities relating to the shareholders with registered addresses in various jurisdictions outside of Australia and New Zealand, the Company has formed the view that it is unreasonable to extend the Rights Issue to those shareholders. Accordingly, shareholders outside of Australia and New Zealand, will not be entitled to participate in the Rights Issue.

Eligible Shareholders can also participate in an Additional Offer to Eligible Shareholders to apply for New Shares in addition to their entitlement, which applications can be accepted in the discretion of the Company.

The purpose of the Rights Issue is to raise approximately $1,423,947, including the costs of the Rights Issue. The funds raised from the Rights Issue, in conjunction with the funds from the Placement, will be used for the purposes of: (a) undertaking an exploration diamond drilling programme (minimum of 3,500m) targeting an increase in the Cleveland open cut Mineral Resource;

• (b) undertaking metallurgical test work, geotechnical studies, environmental compliance studies and geophysics on the proposed Cleveland Open Cut development;

• (c) paying the costs of the Offers; and

• (d) providing working capital.

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A proposed timetable for the Rights Issue is set out in the table below:

Announcement of Issue	Thursday, 29 June 2017
Lodgement of Prospectus with ASIC and ASX	Monday, 3 July 2017
Notice to Option Holders	Monday, 3 July 2017
Notice to security holders containing Appendix 3B information	Tuesday, 4 July 2017
Shares commence trading on an ex rights basis	Wednesday, 5 July 2017
Record Date for the Offer	Thursday, 6 July 2017
Prospectus and Entitlement and Acceptance Form despatched to Shareholders	Tuesday, 11 July 2017
Opening Date of Offers (9am Brisbane time)	Tuesday, 11 July 2017
Closing Date of Offers (excluding the Shortfall Offer) (5pm Brisbane time)	Wednesday, 2 August 2017
Advise ASX of any shortfall	Monday, 7 August 2017
Expected date of issue of New Shares and New Options (excluding the Shortfall Offer)	Wednesday, 9 August 2017
Expected date of despatch of holding statements for New Shares and New Options (excluding the Shortfall Offer)	Wednesday, 9 August 2017
Commencement of trading of New Shares on ASX (excluding the Shortfall Offer)	Thursday, 10 August 2017
Shortfall Offer expected to close	Wednesday, 16 August 2017
Expected date of issue of New Shares and New Options (Shortfall Offer only)	Monday, 21 August 2017
Expected date for despatch of holding statements for New Shares and New Options (Shortfall Offer only)	Monday, 21 August 2017
Commencement of trading of New Shares on ASX (Shortfall Offer only)	Tuesday, 22 August 2017

This timetable is indicative only and may be subject to change subject to the requirements of the Corporations Act 2001 (Cth) ( Corporations Act ) and the ASX Listing Rules.

The Rights Issue is being made in accordance with section 713 of the Corporations Act. Elementos will prepare and send prospectus to shareholders on Tuesday, 11 July 2017, as set out in the timetable above. The Prospectus has been lodged with ASIC and ASX on Monday, 3 July 2017 and is available on the Company’s website www.elementos.com.au and the ASX website.

Further information

The Company anticipates that up to 237,324,456 New Shares will be issued (this number may have to be increased by 5,075,000 New Shares and Attaching Options if existing option holders exercise their options and are registered shareholders by the Record Date). The New Shares will be issued for $0.006 each.

The Company has received pre-commitments from all Placement participants and Mr Andrew Greig, a Director and the largest shareholder of the Company, to take up their entitlements under the Rights Issue, which will represent a total of 70,371,137 New Shares (and 70,371,137 Attaching Options) for a total of $422,227.

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The Rights Offer will contain a debt conversion facility available to all shareholders and the commitment provided by Mr Andrew Greig is on the basis that he will use this debt conversion facility to take up his entitlement under the Rights Issue. This will reduce the debt owed by the Company to Mr Greig by $272,226. Mr Greig has also given a commitment to the Company to exercise the New Options that he receives under the Rights Issue immediately after completion of the Rights Issue (to the maximum extent that he is able to do so without being in contravention of the takeover provisions of the Corporations Act) by converting further debt against the exercise price for those New Options, reducing the debt owed to him by up to a further $272,226.

Upon completion of the Rights Issue, and assuming it is fully subscribed and that existing options are not exercised, the issued capital of Elementos will comprise approximately 1,186,622,279 shares and 357,624,456 unlisted options exercisable at between $0.006 and $0.03 each. If Mr Greig exercises all of the Attaching Options received by him under the Rights Issue then the issued capital of Elementos will comprise approximately 1,231,993,415 shares and 312,253,319 unlisted options.

The New Shares will rank equally in all respects with Elementos’s existing shares. If an Eligible Shareholder's entitlement results in a fraction of a New Share, the entitlement will be rounded up to the nearest whole number. There will be no change to the dividend policy of the Company as a result of the Rights Issue.

Trading in the New Shares is expected to commence on Tuesday, 22 August 2017, the first business day following dispatch of the holding statements for the New Shares.

An Appendix 3B applying for quotation of the New Shares was lodged with ASX on Thursday, 29 June 2017. As stated in that Appendix 3B, the Company has not sought nor obtained approval under ASX Listing Rule 7.1 and the Company currently has capacity to issue 112,324,455 equity securities pursuant to ASX Listing Rule 7.1.

Elementos encourages all eligible shareholders to participate in the capital raising.

Yours faithfully

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Duncan Cornish Company Secretary Elementos Limited

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4 July 2017

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Mr Enrique Emilio Arroyo 930 Peru Street 2 Floor MENDOZA 5500 ARGENTINA

Dear Shareholder

Elementos Limited ACN 138 468 756 - non-renounceable rights issue

On Thursday, 29 June 2017, Elementos Limited ( Elementos or the Company ) announced a nonrenounceable rights issue to eligible shareholders, on the basis of 1 new fully paid ordinary shares for every 4 shares held at an issue price of $0.006 per share ( New Share ), to raise approximately $1,423,947 before costs ( Rights Issue ).

This is following the Company’s announcement on Thursday 29 June 2017 of a private placement to sophisticated investors of 100,000,000 Shares and 100,000,000 Options on the same terms as the New Shares and New Options raising $600,000 before costs ( Placement ), including $480,000 from ASX listed Jervois Limited.

The purpose of the Rights Issue is to raise approximately $1,423,947 for the Company to use in conjunction with the funds from the Placement for the purposes:

• (a) undertaking an exploration diamond drilling programme (minimum of 3,500m) targeting an increase in the Cleveland open cut Mineral Resource;

• (b) undertaking metallurgical test work, geotechnical studies, environmental compliance studies and geophysics on the proposed Cleveland Open Cut development;

• (c) paying the costs of the Offers; and

• (d) providing working capital.

The Prospectus in relation to the Rights Issue was lodged with the Australian Securities Exchange ( ASX ) on Monday, 3 July 2017 and is available on the ASX website and also on the Company website at www.elementos.com.au.

A proposed timetable for the Rights Issue is set out in the table below:

Announcement of Issue	Thursday, 29 June 2017
Lodgement of Prospectus with ASIC and ASX	Monday, 3 July 2017
Notice to Option Holders	Monday, 3 July 2017
Notice to security holders containing Appendix 3B information	Tuesday, 4 July 2017
Shares commence trading on an ex rights basis	Wednesday, 5 July 2017
Record Date for the Offer	Thursday, 6 July 2017
Prospectus and Entitlement and Acceptance Form despatched to Shareholders	Tuesday, 11 July 2017
Opening Date of Offers (9am Brisbane time)	Tuesday, 11 July 2017

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Closing Date of Offers (excluding the Shortfall Offer) (5pm Brisbane time)	Wednesday, 2 August 2017
Advise ASX of any shortfall	Monday, 7 August 2017
Expected date of issue of New Shares and New Options (excluding the Shortfall Offer)	Wednesday, 9 August 2017
Expected date of despatch of holding statements for New Shares and New Options (excluding the Shortfall Offer)	Wednesday, 9 August 2017
Commencement of trading of New Shares on ASX (excluding the Shortfall Offer)	Thursday, 10 August 2017
Shortfall Offer expected to close	Wednesday, 16 August 2017
Expected date of issue of New Shares and New Options (Shortfall Offer only)	Monday, 21 August 2017
Expected date for despatch of holding statements for New Shares and New Options (Shortfall Offer only)	Monday, 21 August 2017
Commencement of trading of New Shares on ASX (Shortfall Offer only)	Tuesday, 22 August 2017

This timetable is indicative only and may be subject to change subject to the requirements of the Corporations Act 2001 (Cth) ( Corporations Act ) and the ASX Listing Rules.

In accordance with the ASX Listing Rules, Elementos has considered the number of shareholders with registered addresses outside of Australia and New Zealand, the number and value of the shares held by those shareholders, and the number and value of New Shares those shareholders would be offered pursuant to the Rights Issue. Taking this into consideration, as well as taking into consideration the costs of complying with the legal requirements and the requirements of the regulatory authorities of those relevant jurisdictions outside of Australia and New Zealand, Elementos believes it to be unreasonable to extend the Rights Issue to all shareholders. Accordingly, the offer pursuant to the Rights Issue will only be extended to those who are Elementos shareholders as at 7.00pm (Brisbane time) on Thursday, 6 July 2017, and who have registered addresses in Australia and New Zealand.

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

As you are a shareholder with a registered address outside of Australia or New Zealand, the offer pursuant to the Rights Issue will not be extended to you. You do not have to take any further action in relation to this Offer.

Please contact Duncan Cornish on +61 7 3221 7770 if you have any queries regarding the Rights Issue or your eligibility to participate in the Rights Issue.

Yours faithfully

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Duncan Cornish Company Secretary Elementos Limited

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