ELEMENTOS LIMITED — Proxy Solicitation & Information Statement 2014

Jan 19, 2014

==> picture [178 x 63] intentionally omitted <==

20 January 2014

The Manager Company Announcements Office Australian Securities Exchange 20 Bridge Street Sydney NSW 2000

Dear Sir/Madam

Notice of Extraordinary General Meeting

Please find attached a copy of the Notice of Extraordinary General Meeting, Explanatory Memorandum and Proxy Form for Elementos Limited’s (ASX:ELT) Extraordinary General Meeting to be held on Thursday, 20 February 2014.

Shareholders are invited to attend the Company’s Extraordinary General Meeting to be held at the offices of Elementos Limited, Level 8, 26 Wharf Street, Brisbane, Queensland on Thursday, 20 February 2014 commencing at 9am (Brisbane Time).

Yours faithfully

==> picture [142 x 55] intentionally omitted <==

Linda Scott Company Secretary

==> picture [468 x 34] intentionally omitted <==

==> picture [178 x 63] intentionally omitted <==

ELEMENTOS LIMITED ACN 138 468 756

Notice of General Meeting and Explanatory Memorandum

Date of Meeting: Thursday, 20 February 2014 Time of Meeting: 9am (AEST) Place of Meeting : Elementos Limited Level 8 26 Wharf Street Brisbane Qld 4000

Notice of General Meeting

Notice is given that a General Meeting of Shareholders of Elementos Limited ACN 138 468 756 ( Company ) will be held at Level 8, 26 Wharf Street, Brisbane on Thursday, 20 February at 9am (AEST).

Capitalised terms used in this Notice of Meeting and the Explanatory Memorandum have the meaning ascribed to them in the Explanatory Memorandum.

This Notice of Meeting should be read in its entirety, together with the Explanatory Memorandum and the enclosed proxy form.

Ordinary business

1. Resolution 1 - Ratification of Unconditional Placement

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an Ordinary Resolution:

"That, for the purposes of Listing Rule 7.4 and for all other purposes, the issue of 68,950,000 Shares ( Unconditional Shares ) by way of private placement to sophisticated and professional investors at an issue price of $0.02 per Share ( Unconditional Placement ), in accordance with the terms set out in the Explanatory Memorandum, be ratified."

Voting exclusion : The Company will disregard any votes cast on Resolution 1 by a person who received Shares pursuant to the Unconditional Placement and any Associates of those persons. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the proxy form, or it is cast by the person chairing the General Meeting as proxy for a person who is entitled to vote, in accordance with the direction on the proxy form to vote as the proxy decides.

2. Resolution 2 - Approval of Conditional Placement

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an Ordinary Resolution:

"That, for the purposes of Listing Rule 7.1 and for all other purposes, the issue of 15,000,000 Shares ( Conditional Shares ) by way of private placement to sophisticated and professional investors at an issue price of $0.02 per Share ( Conditional Placement ), in accordance with the terms set out in the Explanatory Memorandum, be approved.”

Voting exclusion: The Company will disregard any votes cast on Resolution 2 by a person who is intended to be issued Shares pursuant to the Conditional Placement and any other person who might obtain a benefit, except a benefit arising solely from their capacity as a holder of Shares, if the resolution is passed, together with any of their respective Associates. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the proxy form, or it is cast by the person chairing the General Meeting as proxy for a person who is entitled to vote, in accordance with the direction on the proxy form to vote as the proxy decides.

3. Resolution 3 - Approval to Issue Shares to Mr Richard Seville

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an Ordinary Resolution:

“That, for the purposes of Listing Rule 10.11 and for all other purposes, the issue of 7,500,000 Conditional Shares to Mr Richard Seville pursuant to the Conditional Placement, be approved."

Voting exclusion : The Company will disregard any votes cast on Resolution 3 by Mr Seville and any of his Associates. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the proxy form, or it is cast by the person chairing the General Meeting as a proxy for a person who is entitled to vote, in accordance with the direction on the proxy form to vote as the proxy decides

2

Notice of General Meeting

4. Resolution 4 - Approval to Issue Options under Option Plan

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an Ordinary Resolution:

“That, for the purposes of Exception 9 of Listing Rule 7.2 and for all other purposes, the Company is authorised to issue Options (and the subsequent issue of Shares on the exercise of those Options) in accordance with the Company's Employee and Officer Share Option Plan ( Option Plan ), in accordance with the terms set out in the Explanatory Memorandum.”

Voting exclusion : The Company will disregard any votes cast on Resolution 4 by a Director or any officer, employee or contractor who may be eligible to participate in the Option Plan and any of their respective Associates. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the proxy form, or it is cast by the person chairing the General Meeting as a proxy for a person who is entitled to vote, in accordance with the direction on the proxy form to vote as the proxy decides.

Further, a vote must not be cast on this Resolution 4 (and will be taken not to have been cast if cast contrary to this restriction) by a member of the Key Management Personnel and any Closely Related Party of such a member acting as a proxy, if their appointment does not specify the way the proxy is to vote on this Resolution. However, a member of the Key Management Personnel or any Closely Related Party of such a member may vote when acting as proxy if the person is the Chair of the Meeting and the appointment expressly authorises the Chair to exercise the proxy even if the resolution is connected directly or indirectly with the remuneration of a member of the Key Management Personnel.

5. Resolution 5 - Issue of Options to Mr Corey Nolan

To consider and, if thought fit, pass the following Ordinary Resolution, with or without amendment:

“That, for the purposes of Listing Rule 10.14 and for all other purposes, the issue of 6,200,000 Options to Mr Corey Nolan, a Director of the Company, pursuant to the Option Plan on the terms set out in the Explanatory Memorandum.”

Voting exclusion : The Company will disregard any votes cast on Resolution 5 by Mr Nolan, any Director of the Company and any of their respective Associates. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the proxy form, or it is cast by the person chairing the General Meeting as a proxy for a person who is entitled to vote, in accordance with the direction on the proxy form to vote as the proxy decides

Further, a vote must not be cast on this Resolution 5 (and will be taken not to have been cast if cast contrary to this restriction) by a member of the Key Management Personnel and any Closely Related Party of such a member acting as a proxy, if their appointment does not specify the way the proxy is to vote on this Resolution 5. However, a member or any Closely Related Party of such a member may vote when acting as proxy if the person is the Chair of the Meeting and the appointment expressly authorises the chair to exercise the proxy even if the resolution is connected directly or indirectly with the remuneration of a member of the Key Management Personnel.

3

Notice of General Meeting

6. Resolution 6 - Issue of Options to Mr Calvin Treacy

To consider and, if thought fit, pass the following Ordinary Resolution, with or without amendment:

“That, for the purposes of Listing Rule 10.14 and for all other purposes, the Company is authorised to issue of 6,200,000 Options to Mr Calvin Treacy, a Director of the Company, pursuant to the Option Plan on the terms set out in the Explanatory Memorandum.”

Voting exclusion : The Company will disregard any votes cast on Resolution 6 by Mr Treacy, any Director of the Company and any of their respective Associates. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the proxy form, or it is cast by the person chairing the General Meeting as a proxy for a person who is entitled to vote, in accordance with the direction on the proxy form to vote as the proxy decides

Further, a vote must not be cast on this Resolution 6 (and will be taken not to have been cast if cast contrary to this restriction) by a member of the Key Management Personnel, and any Closely Related Party of such a member acting as a proxy, if their appointment does not specify the way the proxy is to vote on this Resolution 6. However, a member of the Key Management Personnel or any Closely Related Party of such a member may vote when acting as proxy if the person is the Chair of the Meeting and the appointment expressly authorises the Chair to exercise the proxy even if the resolution is connected directly or indirectly with the remuneration of a member of the Key Management Personnel.

By order of the Board

==> picture [112 x 49] intentionally omitted <==

Ms Linda Scott Company Secretary Elementos Limited 20 January 2014

4

Explanatory Memorandum

The following notes and the Explanatory Memorandum form part of the Notice of Meeting.

Voting and Attendance Entitlement

The Board has determined that those persons who are registered as holding Shares as at 7:00pm (Sydney time) on Tuesday, 18 February 2014, will be entitled to attend and vote at the Meeting.

Accordingly, transactions registered after that time will be disregarded in determining entitlements to attend and vote at the Meeting.

If more than one joint holder of a Share is present at the Meeting (whether personally, by proxy, by attorney or by representative) and tenders a vote, only the vote of the joint holder whose name appears first on the register will be counted.

Action to be Taken by Shareholders

A Shareholder who is entitled to attend and vote at the Meeting may appoint a person, who need not be a Shareholder of the Company, as the Shareholder’s proxy to attend and vote on behalf of the Shareholder.

A Shareholder who is entitled to cast 2 or more votes may appoint 2 proxies and may specify the proportion or number of votes each proxy is appointed to exercise.

If you wish to indicate how your proxy should vote, please mark the appropriate boxes on the proxy form. If in respect of any of the items of business you do not direct your proxy how to vote, you are directing your proxy to vote as he or she decides.

If you mark the abstain box for a particular item you are directing your proxy to not vote on your behalf and your Shares will not be counted in computing the required majority in the event of a poll.

For proxies without voting instructions that are exercisable by the Chair of the Meeting, the Chair of the Meeting intends to vote those proxies in favour of the Resolutions. The Chair of the Meeting will be deemed to be appointed where a signed proxy form is returned that does not contain the name of the proxy or where the person appointed on the form is absent from the Meeting

please complete the proxy form and return it at least 48 hours before the Meeting, being no later than 9:00am AEST on Tuesday, 18 February 2014 to:

• (a) if by fax: on + 61 2 9290 9655;

• (b) if by delivery: Level 7, 207 Kent Street, Sydney, NSW, 2000; or

• (c) if by mail: Boardroom Pty Ltd, GPO Box 3993, Sydney, NSW, 2001, Australia.

If the appointment is signed by an attorney, the power of attorney or a certified copy of it must be sent with the proxy form.

Corporate Representatives

A Shareholder which is a corporation may appoint an individual to act as its representative to attend and vote at the Meeting. The appointment must comply with section 250D of the Corporations Act, meaning that Company will require a Certificate of Appointment of Corporate Representative executed in accordance with section 250D of the Corporations Act. The completed certificate should be lodged with Company’s share registry before the Meeting or at the registration desk on the day of the Meeting.

Polls

In the event that a poll is demanded, every Shareholder shall have one vote for every Share registered in their name as at 7.00pm (Sydney time) on Tuesday, 18 February 2014.

Required Majority

Each of the Resolutions are Ordinary Resolutions, requiring a simple majority of the votes cast by Shareholders entitled to vote on them.

General

All Shareholders are invited and encouraged to attend the Meeting or, if they are unable to attend in person, to sign and return the proxy form to the Company in accordance with the instructions set out on the proxy form.

Shareholders, their proxy or Corporate Representatives who plan on attending the Meeting are asked to arrive at the venue at least 30 minutes prior to the time the Meeting is scheduled to commence, so that Shareholders can be checked against the Company’s share register, or appointment as proxy, attorney or Corporate Representative can be verified and their attendance noted.

A proxy form accompanies this Notice of Meeting. Should you wish to appoint a proxy,

5

Explanatory Memorandum

This Explanatory Memorandum contains an explanation of, and information about, the Resolutions to be considered at the General Meeting. Shareholders should read this Explanatory Memorandum in full. This Explanatory Memorandum forms part of the accompanying Notice of Meeting and should be read with the Notice of Meeting.

This Explanatory Memorandum does not take into account the individual investment objectives, financial situation and needs of individual Shareholders or any other person. If you are in any doubt about what to do in relation to the Resolutions, you should consult your financial or other professional adviser.

Capitalised words used in the Notice of Meeting and in this Explanatory Memorandum are defined in the Glossary section at the end of this Explanatory Memorandum. Unless otherwise stated, all references to sums of money, '$' and 'dollars' are references to Australian currency.

Capital Raising Background

On the 6[th] of November 2013, the Company announced a private share placement of new Shares to raise $1,679,000, which comprised:

• (a) the initial issue of 68,950,000 Shares by way of a private placement to sophisticated and professional investors at an issue price of $0.02 per Share, raising $1,379,000 ( Unconditional Placement ); and

• (b) an agreement to subsequently issue a further 15,000,000 Shares by way of private placement to sophisticated and professional investors at an issue price of $0.02 per Share, raising $300,000, which was conditional on Shareholder approval being obtained for that issue ( Conditional Placement ),

(together, the Capital Raising ).

The funds raised from the Capital Raising will be applied to:

• (a) completing the environmental permitting process for the mine de-watering and tailings retreatment project;

• (b) completing the pre-feasibility study to redevelop the underground tin-copper mine;

• (c) satisfying the acquisition payments for the remaining 50% interest in the Cleveland project exploration license; and

• (d) other general working capital purposes.

The table below illustrates the effect of the Capital Raising on the Company’s share capital, assuming that Resolution 2 is passed:

	Securities currently on issue	Securities issued under Unconditional Placement	Securities proposed to be issued under Conditional Placement
Shares	466,751,277	68,950,000	15,000,000
Options (Listed and Unlisted)	42,052,052	-	-

The total dilutionary effect of the Unconditional Placement was 14.77%, and the total dilutionary effect of the Conditional Placement will, if Resolutions 2 and 3 are passed, be 2.80%.

6

Explanatory Memorandum

Resolution 1 - Ratification of Unconditional Placement

Resolution 1 seeks to ratify the issue of 68,950,000 Shares issued pursuant to the Unconditional Placement.

Listing Rule 7.1 provides that, unless an exception applies, the prior approval of shareholders is required for an issue of Equity Securities if the Equity Securities will, subject to certain exceptions, together with the number of all other Equity Securities issued by the company during the previous 12 months, exceed 15% of the number of Equity Securities on issue at the commencement of that 12 month period ( 15% Threshold ).

Listing Rule 7.4 provides that an issue of Equity Securities made without prior shareholder approval is treated as having been made with shareholder approval for the purpose of Listing Rule 7.1 if the issue did not breach Listing Rule 7.1 at the time of issue and the company's shareholders subsequently approve that issue.

The Unconditional Shares were initially issued within the Company's 15% Threshold. However, if Resolution 1 is passed, the Company will not need to include the Unconditional Shares when calculating how many Shares it has already issued in reliance on the 15% Threshold.

This means that, if Resolution 1 is passed together with the approval sought in Resolution 2, the Company will be able to raise further funds by issuing up to the maximum of the 15% Threshold, without the need to obtain the prior approval of Shareholders. Any Equity Securities issued under Listing Rule 7.1 will also be in addition to any Equity Securities that may be issued pursuant to the additional 10% capacity contained in Listing Rule 7.1A.

For the purposes of Listing Rule 7.5, the following information is provided in respect of Resolution 1:

For the purposes Resolution 1:	of Listing Rule 7.5, the following information is provided in respect of
Number of securities issued	The Company has issued 68,950,000 Unconditional Shares.
Issue Price	The issue price for the Unconditional Shares was $0.02 per Unconditional Share, raising $1,379,000 (before the expenses of the Unconditional Placement).
Terms of the securities	All Unconditional Shares rank equally with all other Shares on issue.
Names of allottees	The Unconditional Shares were issued to various professional and sophisticated investors who were significant Shareholders in the Company and/ or had previously subscribed for Shares in the Company’s May 2013 share purchase plan and had indicated to the Company that they would like to subscribe for additional Shares. No Director or any of their Associates have participated in, or will receive any Unconditional Shares pursuant to, the Unconditional Placement.
Use of funds	The funds raised by the Unconditional Placement will be used for the purposes outlined in the section of this Explanatory Memorandum entitled “Capital Raising Background”.

The Directors unanimously recommend that Shareholders vote in favour of Resolution 1 and advise that they intend to vote any Shares that they own or control in favour of Resolution 1.

7

Explanatory Memorandum

Resolution 2 - Approval of Conditional Placement

As mentioned in the section of this Explanatory Memorandum entitled “ Capital Raising Background ” on page 6, the Capital Raising included a Conditional Placement whereby the Company has agreed to issue a further 15,000,000 Shares to sophisticated and professional investors at an issue price of $0.02, subject to first obtaining Shareholder approval.

As the Company does not have sufficient capacity to issue the Conditional Shares within its 15% Threshold, prior Shareholder approval is required under Listing Rule 7.1 in order to proceed with the Conditional Placement. Resolution 2 seeks this approval.

If Resolution 2 is passed, the Company will issue the Conditional Shares to those sophisticated and professional investors who have applied for Conditional Shares in accordance with the Conditional Placement.

Shareholders should also be aware, that if Resolution 2 is passed, any Shares issued pursuant to the Conditional Placement will not be counted towards the Company's 15% Threshold under Listing Rule 7.1 when calculating how many Equity Securities can be issued in the absence of Shareholder approval. Any Equity Securities issued under Listing Rule 7.1 will also be in addition to any Equity Securities that may be issued pursuant to the additional 10% capacity contained in Listing Rule 7.1A.

If Resolution 2 is not passed, no Conditional Shares will be issued and all application money received from applicants under the Conditional Placement will be returned to those applicants.

For the purposes of Listing Rule 7.3, the following information is provided in respect of Resolution 2:

For the purposes of Resolution 2:	Listing Rule 7.3, the following information is provided in respect of
Maximum number of securities proposed to be issued	Subject to Resolution 2 being passed, the maximum number of Conditional Shares that the Company will issue will be 15,000,000 Conditional Shares.
Issue Price	The issue price of the Conditional Shares is $0.02 per Conditional Share, raising $300,000 before expenses of the Conditional Placement.
Terms of the securities	All Conditional Shares will, from their date of issue, rank equally with all other Shares on issue. The Company will apply for the Conditional Shares to be quoted on the ASX.
Names of allottees	If Resolution 2 is passed the Shares will be issued to the following persons: (a) Mr Andrew Carlyle Greig; and (b) subject to Resolution 3 also being passed, Mr Richard Seville. Other than Mr Seville, no other Director or any of their Associates have participated in, or will receive any Conditional Shares pursuant to, the Conditional Placement.
Use of funds	It is proposed that the funds raised by the Conditional Placement will be used for the purposes outlined in the section of this Explanatory Memorandum entitled “Capital Raising Background”.

8

Explanatory Memorandum

	Date of issue	The Conditional Shares will be issued as soon as practicable following the Meeting, and in any event, will be issued no later than 3 months after the Meeting1.

The Directors, other than Mr Seville, subject to the passing of this Resolution 2 and Resolution 3 below, who will be issued Conditional Shares pursuant to the Conditional Placement and has therefore abstained from providing any such recommendation, unanimously recommend that Shareholders vote in favour of Resolution 2.

Resolution 3 - Approval of Issue of Shares to Mr Richard Seville

As noted in the explanatory notes for Resolution 2 on page 8, the Capital Raising included a Conditional Placement to sophisticated and professional investors that is subject to Shareholder approval in accordance with Resolution 2.

Among those persons who subscribed for Shares pursuant to the Conditional Placement was Mr Seville, a Director of the Company.

ASX Listing Rule 10.11 requires that the Company obtain Shareholder approval prior to the issue of equity Equity Securities to a Related Party of the Company

As Mr Seville is a Related Party of the Company, by virtue of his position as a Director, Resolution 3 seeks Shareholder approval for the issue of Conditional Shares to Mr Seville in accordance with Listing Rule 10.11.

The effect of Resolution 3 will be that, if passed (in addition to Resolution 2), Mr Seville will receive Conditional Shares.

If either Resolution 2 or 3 are not passed, no Shares will be issued to Mr Seville as part of the Conditional Placement and that all application money received from Mr Seville for the Conditional Shares will be returned to him.

Shareholders should be aware that, if approval is given to issue Shares to Mr Seville under Listing Rule 10.11, approval will not be required under Listing Rule 7.1 and that the number of Shares issued to Mr Seville will not be counted towards the Company’s 15% threshold.

For the purposes of Listing Rule 10.13, the following information is provided in respect of Resolution 3:

Maximum number of securities proposed to be issued	The maximum number of Shares proposed to be issued to Mr Seville is 7,500,000 Conditional Shares.
Issue Price	The issue price of the Conditional Shares proposed to be issued to Mr Seville is $0.02 per Conditional Share.
Terms of the securities	All Conditional Shares will, from their date of issue, rank equally with all other Shares on issue. The Company will apply for the Conditional Shares to be quoted on the ASX.

1 Other than Mr Seville’s Conditional Shares, which will be issued within 1 month of the date of approval.

9

Explanatory Memorandum

Names of allottees	If Resolutions 2 and 3 are passed, the Shares will be issued to Mr Seville.
Use of funds	It is proposed that the funds raised by the Conditional Placement will be used for the purposes outlined in the section of this Explanatory Memorandum entitled “Capital Raising Background”.
Date of issue	The Conditional Shares will be issued as soon as practicable following the Meeting, and in any event, will be issued no later than 1 month after this Meeting.

As the proposed issue of Shares to Mr Seville in accordance with Resolution 3 will:

• (a) be at the same issue price as all other participants in the Capital Raising; and

• (b) provide the Company with significant additional funds to progress its objectives,

the Directors, other than Mr Seville who has abstained from providing any recommendation, recommend that Shareholders vote in favour of Resolution 3 and advise that they intend to vote any Shares that they own or control in favour of Resolution 3.

Resolution 4 - Approval of Option Plan

The Company has previously established an Employee and Officer Share Option Plan ( Option Plan ) to enable the issue of Options to eligible employees, officers and senior consultants to assist in the attraction, retention and motivation of those persons.

While Shareholders have previously approved the Option Plan, following the recent changes to the structure of the Company, the Company intends to amend the Option Plan so as to seek to increase its effectiveness and to better incentivise eligible employees, officers and senior consultants to the Company.

Specifically, it is proposed that the Option Plan be amended as follows:

• (a) Good Leaver – Board Discretion

Currently, the Option Plan enables the Board to exercise its discretion to prevent an Option from automatically lapsing in circumstances where a participant in the Option Plan ceases to be an employee, a Director or otherwise engaged by the Company, including in circumstances where an employee dies, becomes redundant, resigns, has their employment terminated or becomes permanently disabled ( Ceasing Event ), and to allow those Options to be exercised at any time prior to the earlier of:

• (a)the expiry of their initial term; and

• (b)the date that is 6 months after the Ceasing Event.

However, the Option Plan does not include the ability for the Board to waive any conditions attaching to the Options in those circumstances.

Accordingly, the Company is proposing to amend the Option Plan to provide the Board with the ability to:

• (i) waive any exercise conditions attaching to an Option; and

• (ii) enable any Options issued to be exercised at any time prior to their expiry,

where a Ceasing Event occurs.

10

Explanatory Memorandum

The purpose of these amendments is to reflect the fact that a participant in the Option Plan (or their representative in the case of death or permanent incapacity) may have limited scope to influence whether any conditions attaching to any Options issued are satisfied following the occurrence of such a Ceasing Event.

Accordingly, in these circumstances, the Directors consider that it is appropriate that the Board also have the discretion to waive any conditions attaching to the Options and allow them to be exercised at any time during their term in circumstances where it is appropriate to do so.

(b) Broader Discretion to Waive Exercise Conditions on a Merger

Currently, the Option Plan enables the Board to determine that Options have become exercisable in circumstances where a takeover bid is made for the Company and a person acquires more than 50% of the Company’s Shares.

However, in recognition of the various means by which a takeover or reorganisation of the Company’s Shares may occur, the Company intends to amend the Option Plan to also provide the Board with the discretion to determine that Options have become exercisable where:

• (i) a scheme of arrangement pursuant to the Corporations Act has been approved by the Court for the acquisition of more than 50% of the total issued capital of the Company; or

• (ii) any person acquires a Relevant Interest in more than 50% of the voting power in the Company.

The purpose of these amendments is to reflect the fact that there may be other circumstances, other than a takeover bid is made for the Company, where it is appropriate for the Board to have the discretion to determine that the Options have become exercisable.

The Directors consider that this amendment appropriately recognises that Shareholder value may be increased through a range of corporate activities other than just a takeover offer for the Company, as has been reflected in the recent acquisition of Rockwell Minerals Limited by the Company.

A summary of the terms and conditions of the Option Plan (as amended) is contained in Annexure A to this Explanatory Memorandum.

Shareholder approval for the issue of Options pursuant to the Option Plan (as amended) is now being sought for the reasons set out below.

Listing Rules

As noted under the other Resolutions of this Explanatory Memorandum, ASX Listing Rule 7.1 prohibits, subject to certain qualified exceptions, the Company from issuing Equity Securities in excess of the 15% Threshold, unless prior Shareholder approval is obtained.

ASX Listing Rule 7.2, however, provides that the general prohibition contained in Listing Rule 7.1 does not apply to any Options issued in accordance with the Option Plan, if in the 3 years before the date of the relevant issue, Shareholders have approved the issue of Options under the Option Plan as an exception to Listing Rule 7.1.

Accordingly, Resolution 4 seeks Shareholder approval of the Option Plan as an exception to Listing Rule 7.1.

If Resolution 4 is passed, any issue of Options in accordance with the Option Plan during the three years following the passing of the Resolution will not be counted towards the Company’s

11

Explanatory Memorandum

15% Threshold when calculating how many Equity Securities can be issued in the absence of Shareholder approval. This will not, however, restrict the issue of any Shares on the exercise of any Options already issued prior to the expiry of that three year period.

Corporations Act

The Corporations Act restricts the Company from giving certain “benefits” to certain persons (those who hold a managerial or executive office, as defined in the Corporations Act) on ceasing their employment with the Company ( Termination Benefits ), in the absence of prior shareholder approval unless an exemption applies.

The term “benefit” is defined broadly in the Corporations Act and includes benefits arising from the Board exercising its discretion under the rules of the Option Plan.

Resolution 4 also seeks Shareholder approval, for the Company to provide these Termination Benefits to participants in the Option Plan.

Specifically, Shareholder approval is being sought to enable the Board to exercise certain discretions under the Option Plan, including the discretion to determine to waive some or all of the exercise conditions attaching to Options issued to a participant, where a participant ceases to be employed or engaged by the Company, including as a result of redundancy, resignation, death, or the termination of their employment or engagement (where they are a contractor) for cause.

This approval is being sought in respect of any current or future participant in the Option Plan, and the Termination Benefits that may arise if and when any participants cease to be engaged by the Company.

Except as provided for, and subject to the passing of, Resolutions 5 and 6, no other Director will participate in the Option Plan unless separate Shareholder approval is first obtained. For the purposes of ASX Listing Rule 7.2 (Exception 9(b)) and section 200E of the Corporations Act, the following information is provided in respect of Resolution 4.

Prior issue of Options pursuant to the Option Plan	As at the date of this Explanatory Memorandum, the Company has not made any issues of Options under the Option Plan (as amended). Shareholders should, however, be aware that the Company has previously issued 9,100,000 options to Directors and other senior management pursuant to the Option Plan prior to its proposed amendment.
Terms of Options	A summary of the terms of the Option Plan is set out in Annexure A.
Explanation of the termination benefits	The Option Plan contains provisions setting out the treatment of unexercised Options, including the Board’s discretion to waive any exercise conditions attaching to those Options in the event of cessation of engagement by the Company arising from, among other things, redundancy, resignation, death, termination of employment for cause or becomes permanently disabled. As noted above, the exercise of these discretions by the Board will constitute a “benefit” for the purposes of the restrictions contained in the Corporations Act’s regarding Termination Benefits.
Value of the termination benefits	Various matters will or are likely to affect that value of the Termination Benefits that the Board may give under the Option Plan and, therefore the value of the Termination Benefits cannot be determined in advance. The value of a particular benefit resulting from the exercise of the Board’s discretion under

12

Explanatory Memorandum

the Option Plan will depend on factors such as the Company’s share price at the time of the exercise of this discretion and the number of Options that the Board decides to waive the exercise conditions in respect of. Some of the factors that may affect the value of the Termination Benefits are as follows: (a) the nature and extent of any exercise conditions waived by the Board; (b) the number of exercise conditions that have been satisfied at the time that the Board exercises this discretion; and (c) the number of unexercised Options that the participant holds at the time that this discretion is exercised.

As it is proposed that each of Messrs Nolan and Treacy will receive Options pursuant to the Option Plan, subject to the passing or Resolutions 5 and 6, and as a result of any perceived conflict of interest that Mr Seville may have in relation to the proposed issue of Options, the Directors do not make any voting recommendation to Shareholders as to how to vote on Resolution 4.

Resolutions 5 and 6 - Issue of Options to Mr Corey Nolan and Mr Calvin Treacy

As approval is required under Resolutions 5 and 6 for the same reasons, the explanations for these three Resolutions have been combined into this summary.

Resolution 4 seeks Shareholder approval for the Company to issue Options to Directors, employees and contractors to the Company in accordance with the terms of the Option Plan.

Among those persons initially intended to be issued Options in accordance with the Option Plan are two of the Company’s Directors, Messrs Nolan and Treacy.

However, Listing Rule 10.14 provides that a director may not acquire securities under an employee incentive scheme without the approval of shareholders.

Accordingly, Resolutions 5 and 6 seek Shareholder approval for the Company to issue Options to each of Messrs Nolan and Treacy in accordance with the Option Plan.

A summary of the terms of the Option Plan is set out in Annexure A. The specific terms that will apply to the issue of Options to Messrs Nolan and Treacy are set out below.

For the purposes of Listing Rule 10.15, the following information is provided in respect of Resolutions 5 and 6:

	Resolution 5	Resolution 6
Proposed allottees	Mr Corey Nolan	Mr Calvin Treacy
Maximum number of securities to be issued	6,200,000 Options	6,200,000 Options
Issue date and Exercise Period	The Options will be issued as soon as practicable following the Meeting and, in any event, will be issued no later than 12 months after this General Meeting. The Options may be exercised at any time within 48 months of their being issued, subject to the Board’s discretion to extend the

13

Explanatory Memorandum

	exercise period in accordance with the terms of the Option Plan.
Issue and exercise price	The Options are being issued as part of Messrs Nolan and Treacy’s remuneration and as an incentive for future performance. As such, they will be issued free of charge. The exercise price per Option, which is required to be paid to receive Shares on the exercise of the Options, is 3 cents. No loans have been or will be provided as part of the Option Plan.
Details of Directors or their associates who previously received Options under the scheme	The details of all Directors and their Associates that received options under the scheme since the last approval are: (a) 2,500,000 options issued to Mr Nolan, which were issued on 23 October 2009 and had an exercise price of 22.6 cents; and (b) 800,000 options issued to Mr Nolan, which were issued on 8 February 2013 and had an at an exercise price of 6 cents.
Names of persons referred to in Listing Rule 10.14 that are entitled to participate in the Option Plan	Each of Messrs Nolan, Treacy and Seville, together with any other Director that may be appointed from time to time, are entitled to participate in the Option Plan. However, as Shareholder approval is not currently being sought, and has not previously been obtained, for the issue of Options to Mr Seville or any other Director other than Messrs Nolan and Treacy, no Options will be issued to Mr Seville or any other Director that may be appointed in the future unless Shareholder approval is separately sought and obtained for the issue of such Options pursuant to Listing Rule 10.14.

Additional Disclosure

To assist Shareholders in considering the proposed Resolutions, the Company also provides the following additional information in respect of Resolutions 5 and 6:

	Resolution 5	Resolution 6
Proposed allottee	Mr Corey Nolan	Mr Calvin Treacy
Terms of issue	A summary of the terms of the Option Plan is set out in Annexure A.
Use of funds	If the full 6,200,000 Options are exercised, an amount (based on $0.03 per Option) of $186,000 will be raised. This amount will be put towards the Company’s general working capital requirements and exploration activities at the relevant time.	If the full 6,200,000 Options are exercised, an amount (based on $0.03 per Option) of $186,000 will be raised. This amount will be put towards the Company’s general working capital requirements and exploration activities at the relevant time.
Why are Options proposed to be issued	In the Company’s circumstances as they existed as at the date of this Explanatory Memorandum, the Directors consider that the Options provide a cost-effective and efficient incentive as opposed to alternative forms of incentives (e.g. cash bonuses, increased remuneration). However, it must be recognised that there will be an opportunity cost to the Company, being the

14

Explanatory Memorandum

	price at which the Company could grant the Options to a third party. The opportunity costs and benefits foregone by the Company by issuing the Options to each of the recipients is the potentially dilutionary impact on the issued share capital of the Company (in the event that the options are exercised). Until exercised, the issue of the Options will not impact upon the number of ordinary shares on issue in the Company. To the extent that upon their exercise the dilutionary impact caused with the issue of shares will be detrimental to the Company, this is more than offset by the advantages accruing from the Company securing the services of experienced and skilled Directors on appropriate incentive terms. It is also considered that the potential increase of value in the Options is dependent upon a concomitant increase in the value of the Company generally.
Why the number of Options was Chosen	The number of Options was chosen following commercial negotiations between the Company and each of Messrs Nolan and Treacy, for the purpose of providing a cost effective means of incentivising Messrs Nolan and Treacy to increase Shareholder value through the development of the Cleveland project and the monetising of the Company’s other projects. The Board determined that by offering Messrs Nolan and Treacy the Options, together with their remuneration packages, this would assist the Company in securing the services of Messrs Nolan and Treacy.
Directors’ interest in the outcome	Other than the interests that each of Messrs Nolan and Treacy have in receiving Options pursuant to Resolutions 5 and 6 (respectively), no Director has any interest in the outcome of Resolutions 5 and 6.
Valuation of the Options	The Options are not currently quoted on the ASX and as such have no market value. The Options each grant the holder thereof a right of grant of one ordinary share in the Company upon exercise of the Option and payment of the exercise price of the Option described above. Accordingly, the Options may have a present value at the date of their grant. The Options may acquire future value dependent upon the extent to which the shares exceed the exercise price of the Options during the term of the Options. As a general proposition, options to subscribe for ordinary fully paid shares in a company have value. Various factors impact upon the value of options including things such as: (a) the period outstanding before the expiry date of the options; (b) the exercise price of the options relative to the underlying price or value of the securities into which they may be converted; (c) the proportion of the issued capital as expanded consequent upon exercise represented by the shares issued upon exercise (ie whether or not the shares that might be acquired upon exercise of the options represent a controlling or other significant interest); (d) the value of the shares into which the options may be converted; and (e) whether or not the options are listed (ie readily capable of being liquidated).

15

Explanatory Memorandum

	There are various formulae which can be applied to determining the theoretical value of options (including the formula known as the Black- Scholes Model option valuation formula). The Company has applied a Black-Scholes Model, which is the most widely used and recognised model for pricing options. The value of an option calculated by the Black-Scholes Model is a function of the relationship between a number of variables, being the share price, the exercise price, the time to expiry, the risk free interest rate and the volatility of the company’s underlying share price. Inherent in the application of the Black–Scholes Model are a number of inputs, some of which must be assumed. The data relied upon in applying the Black–Scholes Model was: (a) the exercise price of the Options being 3 cents; (b) an assumed Share price at the date the Options are granted of 2 cents, being the Share price as at the date of valuation on 23 December 2013); (c) an expiry date of 4 years from the date the Options are proposed to be issued to the Directors; (d) a volatility measure of 63.41%; (e) a risk-free interest rate of 4.25%; and (f) a dividend yield of nil. Based on this information, the Company has adopted an indicative value for each Option of 0.826 cents. On that basis, the respective value of the Options to be issued pursuant to Resolutions 5 and 6 are as follows: (a) $51,212 (b) $51,212 TOTAL $102,424 The Option valuation noted above assumes a market price of the Shares on the date of issue of 2 cents per Share, being the market value of the Shares as at the date that the valuation was prepared on 23 December 2013. Since the date of the valuation the Share price has dropped to 1.5 cents per Share (as at 15 January 2014) and there is a possibility that the market price of the Shares on the date of issue of the Options will be different to the assumed price of 2 cents used for the valuation.	There are various formulae which can be applied to determining the theoretical value of options (including the formula known as the Black- Scholes Model option valuation formula). The Company has applied a Black-Scholes Model, which is the most widely used and recognised model for pricing options. The value of an option calculated by the Black-Scholes Model is a function of the relationship between a number of variables, being the share price, the exercise price, the time to expiry, the risk free interest rate and the volatility of the company’s underlying share price. Inherent in the application of the Black–Scholes Model are a number of inputs, some of which must be assumed. The data relied upon in applying the Black–Scholes Model was: (a) the exercise price of the Options being 3 cents; (b) an assumed Share price at the date the Options are granted of 2 cents, being the Share price as at the date of valuation on 23 December 2013); (c) an expiry date of 4 years from the date the Options are proposed to be issued to the Directors; (d) a volatility measure of 63.41%; (e) a risk-free interest rate of 4.25%; and (f) a dividend yield of nil. Based on this information, the Company has adopted an indicative value for each Option of 0.826 cents. On that basis, the respective value of the Options to be issued pursuant to Resolutions 5 and 6 are as follows: (a) $51,212 (b) $51,212 TOTAL $102,424 The Option valuation noted above assumes a market price of the Shares on the date of issue of 2 cents per Share, being the market value of the Shares as at the date that the valuation was prepared on 23 December 2013. Since the date of the valuation the Share price has dropped to 1.5 cents per Share (as at 15 January 2014) and there is a possibility that the market price of the Shares on the date of issue of the Options will be different to the assumed price of 2 cents used for the valuation.
Disclosure of total remuneration package	As noted above, the Options are proposed to be issued to Messrs Nolan and Treacy as a means of providing cost effective remuneration and incentives for Messrs Nolan and Treacy for their agreement to join the Board in their respective roles as Executive Director and Managing Director. The remuneration from the Company to Messrs Nolan and Treacy is currently:
	Related party	Current Financial Year Remuneration*
	Mr Corey Nolan	Excluding the Options proposed to be issued as per

16

Explanatory Memorandum

		Resolution 5, Mr Nolan currently receives remuneration of $163,875 per annum (inclusive of superannuation) from the Company for his services as Executive Director.	Resolution 5, Mr Nolan currently receives remuneration of $163,875 per annum (inclusive of superannuation) from the Company for his services as Executive Director.	Resolution 5, Mr Nolan currently receives remuneration of $163,875 per annum (inclusive of superannuation) from the Company for his services as Executive Director.	Resolution 5, Mr Nolan currently receives remuneration of $163,875 per annum (inclusive of superannuation) from the Company for his services as Executive Director.	Resolution 5, Mr Nolan currently receives remuneration of $163,875 per annum (inclusive of superannuation) from the Company for his services as Executive Director.
	Mr Calvin Treacy	Excluding the Options proposed to be issued as per Resolution 6, Mr Treacy currently receives Director's remuneration of $163,875 per annum (inclusive of superannuation) from the Company for his services as Managing Director.
	*Paid pursuant to service contracts with the Company.
Existing interest in the Company	The current Relevant Interests (i.e. before any of the Resolutions are approved) of each of Messrs Nolan and Treacy in the securities of the Company are set out below:
	Related Party	Shares		Options
	Mr Corey Nolan	264,215		3,358,715
	Mr Calvin Treacy	22,750,004		-
Dilutionary effect of the issue of the Options	If all of the Options that are proposed to be issued to Messrs Nolan and Treacy pursuant to Resolution 5 and 6 are granted and are subsequently exercised (and assuming that no other options or shares are issued prior to the exercise of the Options), the following will be the dilutionary effect on the current issued capital of the Company:
	Allottees/Other Shareholders	Current Share Holding	% of Total Share Capital (532,866,27 7 Shares on issue)		Number of Shares upon Exercise of all Options	% of Total Share Capital (545,266,277 Shares on Issue
	Mr Corey Nolan	264,215	0.05%		6,464,215	1.18%
	Mr Calvin Treacy	22,750,004	4.25%		28,950,004	5.28%
	Other Shareholders	512,687,058	95.70%		512,687,058	93.54%
	Total	535,701,277	100%		548,101,277	100%
Taxation Consequences	No stamp duty will be payable in respect of the grant of the Options. No GST will be payable by the Company in respect of the grant of the Options (or if it is then it will be recoverable as an input credit). AASB 2 “Share Based Payments” requires that these payments shall be measured at the more readily determinable fair value of the equity instrument. Under the accounting standards this amount will be expensed in the statement of financial performance. Where the grant date and the vesting date are different the total expenditure calculated will be allocated between the two dates taking into account the terms and conditions attached to the instruments and the counterparties as well as

17

Explanatory Memorandum

	management’s assumptions about probabilities of payments and compliance with and attainment of the set out terms and conditions.	management’s assumptions about probabilities of payments and compliance with and attainment of the set out terms and conditions.
Trading History	A table of the trading history of the Shares for the preceding 12 month period is as follows:
	Closing Price on 15 January 2014, being the day prior to the approval of this Notice of Meeting	$0.015
	12 month VWAP (prior to and including 15 January 2014)	$0.0194
	12 month high (prior to and including 15 January 2014)	$0.035
	12 month low (prior to and including 15 January 2014)	$0.014

Details of any Options issued under the Option Plan will be published in each annual report of the Company relating to a period in which securities have been issued, and where appropriate, confirmation that approval for the issue of securities was obtained under ASX Listing Rule 10.14.

Any additional persons for whom Shareholder approval is required under Listing Rule 10.14 who become entitled to participate in the Option Plan after the passing or Resolutions 5 and6 and who were not name in this Notice of Meeting will not participate until Shareholder approval is obtained under Listing Rule 10.14.

Due to a perceived conflict of interest, the Directors do not make any voting recommendation to Shareholders as to how to vote on Resolutions 5 and 6.

Save as set out in this Explanatory Memorandum, the Directors are not aware of any other information that will be reasonably required by Shareholders to make a decision in relation to benefits contemplated by the proposed Resolutions 5 and 6.

Any inquiries in relation to the Resolutions or the Explanatory Memorandum should be directed to Linda Scott (Company Secretary):

Level 8, 26 Wharf Street, Brisbane, Qld 4000

Ph: (07) 3221 7770

18

Explanatory Memorandum

Glossary

Associate has the meaning given to that term in the Corporations Act.

ASX means ASX Limited (ABN 98 008 624 691).

Board means the board of Directors of the Company.

Capital Raising means the private placement undertaken to sophisticated and professional investors as detailed in the section of this Explanatory Memorandum entitled

Closely Related Party has the meaning given to that term in the Corporations Act.

Company means Elementos Limited ACN 138 468 756.

Conditional Placement means the private placement undertaken to sophisticated and professional investors which was conditional on shareholder approval.

Conditional Shares means the shares issued pursuant to the Conditional Placement.

Corporations Act means the Corporations Act 2001 (Cth).

Director means a director of the Company as at the date of this Explanatory Memorandum.

Eligible Participant means a person who is a Director or officer, a full or permanent employee or senior consultant to the Company or any of its related body corporates that the Board determines are eligible to participate in the Option Plan.

Equity Securities has the meaning given to that term in the Listing Rules.

Explanatory Memorandum means this explanatory memorandum that accompanies, and forms part of, the Notice of Meeting.

General Meeting or Meeting means the general meeting of the Company to be convened by the Notice of Meeting.

Key Management Personnel has the meaning given to that term in the Corporations Act.

Listing Rules means the listing rules of the ASX.

Notice of Meeting means the notice convening the general meeting of shareholders that accompanies this Explanatory Memorandum.

Option means an option to subscribe for a Share.

Option Plan means the Company’s employee and officer share option plan as summarised in Annexure A to this Notice of Meeting.

Ordinary Resolution means a resolution passed by more than 50% of the votes at a general meeting of Shareholder.

Related Party has the meaning given to that term in the Listing Rules.

Relevant Interest has the meaning given to that term in section 608 of the Corporations Act.

Resolution means a resolution referred to in this Notice.

Shareholder means a holder of a Share.

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

Unconditional Placement means the private placement of 68,950,000 of Shares sophisticated and professional investors as detailed in the section of this Explanatory Memorandum.

Unconditional Shares means the 68,950,000 of Shares issued pursuant to the Unconditional Placement.

15% Threshold means the restriction on the issue of Equity Securities contained in Listing Rule 7.1, which prohibits the Company (subject to certain exceptions), from issuing or agreeing to issue Equity Securities representing more than 15% of the number of ordinary shares on issue 12 months prior to the intended date of issue, in the absence of prior shareholder approval.

19

Annexure A – Option Plan Summary

A summary of the rules of the Employee and Officer Share Option Plan ( Plan ) is as follows:

1. All Directors, officers, employees and senior consultants (whether full- or part-time) will be eligible to participate in the Plan after a qualifying period of 12 months employment by the Company or its subsidiaries (or, in the case of a senior consultant, having provided consulting services to the Company or its subsidiaries on a continuous basis for at least 12 months), although the Board may waive this requirement.

2. The allocation of options under the Plan ( Plan Options ) is at the discretion of the Board. 3. If permitted by the Board, Plan Options may be issued to a nominee of a Director, officer, employee or senior consultant (for example, to a spouse or family company).

3. Each Plan Option allows the option holder to subscribe for one fully paid ordinary share in the Company and will expire 5 years after the date of issue of the Plan Option, or such other date as the Board determines in its discretion with respect to the Plan Option at the time of issue of the Plan Option.

4. Plan Options will be issued for no consideration.

5. The Plan Options may be exercised at any time after their issue.

6. The Plan Options may be exercised wholly or in part by notice in writing to the Company received at any time during the exercise period together with a cheque for the exercise price and the Plan Option certificate (if any).

7. The exercise price of Plan Options will be determined by the Board at the time the Board resolves to issue the Plan Options.

8. The total number of shares the subject of Plan Options issued under the Plan, when aggregated with other Plan Options issued under the Plan during the previous 5 years (subject to certain exceptions), must not exceed 5% of the Company’s issued share capital at the time.

9. If, prior to the expiry date of the Plan Options, a person ceases to be a Director, officer, employee or senior consultant to the Company for any reason other than retirement from the workforce, permanent disability or death, the:

10. (a) Board may determine to waive one or more or all of the exercise conditions attaching to the Plan Options; and

11. (b) Plan Options held by that person (or their nominee) must be exercised within 30 days thereafter or they will automatically lapse (subject to the Board’s discretion to extend this period in respect of some or all of the Plan Options).

12. If a person dies, the Plan Options held by that person will be exercisable by that person’s legal representative. Plan Options cannot be transferred other than to the legal personal representative of a deceased option holder.

13. The Company will not apply for official quotation of any Plan Options.

14. Shares issued as a result of the exercise of Plan Options will rank equally with the Company’s issued shares at the time.

15. Option holders may only participate in new issues of securities by first exercising their Plan Options.

16. If there is a bonus issue to the holders of shares, the number of shares over which a Plan Option is exercisable will be increased by the number of shares which the option holder would have received if the Plan Option had been exercised before the record date for the bonus issue.

17. In the event of any reconstruction (including consolidation, subdivision, reduction or return) of the issued capital of the Company:

18. a. the number of Plan Options, the exercise price of the Plan Options, or both will be reconstructed (as appropriate) in a manner consistent with the Listing Rules, but with the intention that such reconstruction will not result in any benefits being conferred on the holders of the Plan Options which are not conferred on shareholders; and

20

Annexure A – Option Plan Summary

• b. subject to the provisions with respect to rounding of entitlements as sanctioned by a meeting of shareholders approving a reconstruction of capital, in all other respects the terms for the exercise of the Plan Options will remain unchanged.

• If during the Life of an Option:

• a. a Takeover Bid is made to the Company’s shareholders to acquire their Shares and the Board becomes aware that a bidder acquires (or become entitled to acquire) a Relevant Interest in more than 50% of the Company’s issued Shares;

• b. a scheme of arrangement pursuant to Chapter 5 of the Corporations Act is approved by a court for the acquisition of more than 50% of the total issued capital of the Company;

• c. any person acquires a Relevant Interest in more than 50% of the voting power in the Company; or

• d. the Board concludes that there has been a change in control of the Company;

• then the Board may determine that any unexercised Options (whether vested or not) will be exercisable.

• If, during the life of any Plan Option, there is a pro rata issue to shareholders (except a bonus issue), the exercise price of any Plan Option may be reduced according to the following formula:

O1 = O - E [P - (S + D)]

1. N + 1

Where:

• O1 = the new exercise price of the Option

• O

• E

• = the old exercise price of the Option

• = the number of underlying securities into which one Option is exercisable

• P = the average market price per security (weighted by reference to volume) of the underlying securities during the five (5) trading days ending on the day before the ex-right date or the ex-entitlements date

• S

• D

• N

• = the subscription price for a security under the pro-rata issue

• = the dividend due but not yet paid on existing underlying securities (except those to be issued under the pro-rata issue)

• = the number of securities with rights or entitlements that must be held to receive a right to one new security

• The terms of the Plan 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 Plan Options shall not be changed to reduce the exercise price, increase the number of Plan Options or change any period for exercise of the Plan Options.

21

==> picture [216 x 96] intentionally omitted <==

All Correspondence to:

• By Mail Boardroom Pty Limited GPO Box 3993 Sydney NSW 2001 Australia

Level 7, 207 Kent Street, Sydney NSW 2000 Australia  By Fax: +61 2 9290 9655

 Online: www.boardroomlimited.com.au  By Phone: (within Australia) 1300 737 760 (outside Australia) +61 2 9290 9600

YOUR VOTE IS IMPORTANT

For your vote to be effective it must be recorded before 9:00am AEST on Tuesday, 18 February 2014.

TO VOTE BY COMPLETING THE PROXY FORM

STEP 1 APPOINTMENT OF PROXY

Indicate who you want to appoint as your Proxy.

If you wish to appoint the Chair of the Meeting as your proxy, mark the box. If you wish to appoint someone other than the Chair of the Meeting as your proxy please write the full name of that individual or body corporate. If you leave this section blank, or your named proxy does not attend the meeting, the Chair of the Meeting will be your proxy. A proxy need not be a security holder of the company. Do not write the name of the issuer company or the registered securityholder in the space.

Appointment of a Second Proxy

You are entitled to appoint up to two proxies to attend the meeting and vote. If you wish to appoint a second proxy, an additional Proxy Form may be obtained by contacting the company’s securities registry or you may copy this form.

To appoint a second proxy you must:

(a) complete two Proxy Forms. On each Proxy Form state the percentage of your voting rights or the number of securities applicable to that form. If the appointments do not specify the percentage or number of votes that each proxy may exercise, each proxy may exercise half your votes. Fractions of votes will be disregarded. (b) return both forms together in the same envelope.

STEP 3 SIGN THE FORM

The form must be signed as follows:

Individual: This form is to be signed by the securityholder.

Joint Holding : where the holding is in more than one name, all the securityholders should sign.

Power of Attorney: to sign under a Power of Attorney, you must have already lodged it with the registry. Alternatively, attach a certified photocopy of the Power of Attorney to this form when you return it.

Companies: this form must be signed by a Director jointly with either another Director or a Company Secretary. Where the company has a Sole Director who is also the Sole Company Secretary, this form should be signed by that person. Please indicate the office held by signing in the appropriate place.

STEP 4 LODGEMENT

Proxy forms (and any Power of Attorney under which it is signed) must be received no later than 48 hours before the commencement of the meeting, therefore by 9:00 am AEST on Tuesday, 18 February 2014. Any Proxy Form received after that time will not be valid for the scheduled meeting.

Proxy forms may be lodged:

STEP 2 VOTING DIRECTIONS TO YOUR PROXY

To direct your proxy how to vote, mark one of the boxes opposite each item of business. All your securities will be voted in accordance with such a direction unless you indicate only a portion of securities are to be voted on any item by inserting the percentage or number that you wish to vote in the appropriate box or boxes. If you do not mark any of the boxes on a given item, your proxy may vote as he or she chooses. If you mark more than one box on an item for all your securities your vote on that item will be invalid.

 By Fax + 61 2 9290 9655  By Mail Boardroom Pty Limited GPO Box 3993, Sydney NSW 2001 Australia Level 7, 207 Kent Street,  In Person Sydney NSW 2000 Australia

Proxy which is a Body Corporate

Where a body corporate is appointed as your proxy, the representative of that body corporate attending the meeting must have provided an “Appointment of Corporate Representative” prior to admission. An Appointment of Corporate Representative form can be obtained from the company’s securities registry.

Attending the Meeting

If you wish to attend the meeting please bring this form with you to assist registration .

Elementos Limited ACN 138 468 756

Your Address

This is your address as it appears on the company’s share register. If this is incorrect, please mark the box with an “X” and make the correction in the space to the left. Securityholders sponsored by a broker should advise their broker of any changes. Please note, you cannot change ownership of your securities using this form.

PROXY FORM

STEP 1 APPOINT A PROXY

I/We being a member/s of Elementos Limited (Company) and entitled to attend and vote hereby appoint:

==> picture [23 x 20] intentionally omitted <==

the Chair of the Meeting (mark box)

OR if you are NOT appointing the Chair of the Meeting as your proxy, please write the name of the person or body corporate (excluding the registered shareholder) you are appointing as your proxy below

==> picture [350 x 19] intentionally omitted <==

or failing the individual or body corporate named, or if no individual or body corporate is named, the Chair of the Meeting as my/our proxy at the General Meeting of the Company to be held at the Elementos Limited, Level 8, 26 Wharf Street, Brisbane QLD 4000 on Thursday, 20 February, 2014 at 9:00am AEST and at any adjournment of that meeting, to act on my/our behalf and to vote in accordance with the following directions or if no directions have been given, as the proxy sees fit.

If the Chair of the Meeting is appointed as your proxy, or may be appointed by default and you do not wish to direct your proxy how to vote as your proxy in respect of resolutions, please place a mark in the box. By marking this box, you acknowledge that the Chair of the Meeting may exercise your proxy even if he or she has an interest in the outcome of those resolutions and that votes cast by the Chair of the Meeting, other than as a proxy holder, may be disregarded because of that interest.

If you do not mark this box, and you have not directed your proxy how to vote, the Chair of the Meeting will not cast your votes on any of resolutions 2,3,4, 5 or 6 and your votes will not be counted in calculating the required majority if a poll is called on those resolutions.

The Chair of the Meeting intends to vote undirected proxies in favour of each of the items of business.

STEP 2 VOTING DIRECTIONS * If you mark the Abstain box for a particular item, you are directing your proxy not to vote on your behalf on a show of hands or on a poll and your vote will not be counted in calculating the required majority if a poll is called.

For Against Abstain*

Resolution 1 Ratification of Unconditional Placement Resolution 2 Approval of Conditional Placement Resolution 3 Approval to Issue Shares to Mr Richard Seville Resolution 4 Approval to Issue Options under Option Plan Resolution 5 Issue of Options to Mr Corey Nolan Resolution 6 Issue of Options to Mr Calvin Treacy

==> picture [23 x 20] intentionally omitted <==

==> picture [23 x 19] intentionally omitted <==

==> picture [23 x 20] intentionally omitted <==

==> picture [23 x 19] intentionally omitted <==

==> picture [23 x 20] intentionally omitted <==

==> picture [23 x 19] intentionally omitted <==

==> picture [23 x 20] intentionally omitted <==

==> picture [23 x 19] intentionally omitted <==

==> picture [23 x 20] intentionally omitted <==

==> picture [23 x 19] intentionally omitted <==

==> picture [23 x 20] intentionally omitted <==

==> picture [23 x 19] intentionally omitted <==

==> picture [23 x 20] intentionally omitted <==

==> picture [23 x 19] intentionally omitted <==

==> picture [23 x 20] intentionally omitted <==

==> picture [23 x 19] intentionally omitted <==

==> picture [23 x 20] intentionally omitted <==

==> picture [23 x 19] intentionally omitted <==

STEP 3 SIGNATURE OF SHAREHOLDERS This form must be signed to enable your directions to be implemented.

Individual or Securityholder 1 Sole Director and Sole Company Secretary

Securityholder 2 Securityholder 3 Director Director / Company Secretary

Contact Name…………………………………………….... Contact Daytime Telephone………………………................................ Date / / 2014