EMERALD RESOURCES NL — Share Issue/Capital Change 2015

Jan 21, 2015

22 January 2015

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ASX Announcement

OPTION ISSUE

The Board of Emerald Resources NL ( EMR or Company ) wishes to advise that it has issued 20 million unlisted $0.025 EMR options, exercisable on or before 21 January 2020 to employees and consultants as part of the incentive component of their remuneration packages.

The exercise price of the options represented a 20% premium to the 30 day VWAP of EMR shares at the time offer letters were sent to the employees and consultants on or about 19 December 2014. The options are subject to vesting conditions which restrict exercise of 50% of the options until 24 months from the date the employee or consultant was appointed and the remaining 50% until 36 months from their appointment date.

It is the EMR Board’s view that such options are an effective tool to attract and incentivise high quality personnel and help to align the long term interests of management and shareholders.

The options have been issued in accordance with the Company’s Employee Option Plan as approved by shareholders on 27 November 2014. No director or director related entity has been the recipient of these options.

The terms and conditions of the options and Appendix 3B to reflect the option issue are attached.

For further information, please contact;

SIMON LEE AO Chairman

Emerald Resources NL ACN 009 795 046 1110 Hay Street, WEST PERTH, WA, AUSTRALIA, 6005 PO Box 1408 West Perth WA 6872 T: 1300 729 543 F: 1300 729 528 E:info@emeraldresources.com.au

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Terms and Conditions of $0.025 Emerald Resources NL Options

1. Definitions:

2. (i) ASX Listing Rules means the official listing rules of ASX Limited;

3. (ii) Company means Emerald Resources NL (ACN 009 795 046).

4. (iii) Corporations Act means Corporations Act 2001 (Cth) of Australia.

5. (iv) Exercise Price means the exercise price of each EMR Option, being $0.025.

6. (v) Expiry Notice means 5.00pm (Perth time) 5 years from the date of issue of the EMR Option.

7. (vi) Exercise Notice means the form prescribed by the Company from time to time for the purpose of exercising EMR Options.

8. (vii) Share means a fully paid ordinary voting share in the capital of the Company.

9. (viii) EMR Option means an option to subscribe for a Share at the Exercise Price prior to the Expiry Date in the manner set out in these Terms and Conditions.

10. (ix) EMR Option Holder means the person or persons registered as the holder of one or more EMR Options from time to time.

11. Each EMR Option carries the right to subscribe for one Share.

12. Each EMR Option is unlisted and is transferable subject to any restrictions on transfer imposed by ASX.

13. Subject to any restrictions imposed by ASX on the exercise of EMR Options, EMR Options may be exercised by the EMR Options Holder by delivering to the Company’s registered office or the Company’s share registry an Exercise Notice at any time prior to the Expiry Date.

14. Each Exercise Notice must state the number of EMR Options to be exercised and be accompanied by the relevant holding statement(s), if any, and payment (in Australian currency) to the Company of an amount (the Application Monies ) being the result of the Exercise Price multiplied by the number of EMR Options being exercised.

15. Following receipt of a properly executed Exercise Notice and Application Monies in respect of the exercise of any EMR Options, the Company will issue the resultant Shares and deliver notification of shareholdings.

16. Subject to any restrictions imposed by ASX, the Company will make application to have the Shares (issued pursuant to an exercise of EMR Options) listed for quotation by ASX within 7 days of the date of issue.

Emerald Resources NL ACN 009 795 046 1110 Hay Street, WEST PERTH, WA, AUSTRALIA, 6005 PO Box 1408 West Perth WA 6872 T: 1300 729 543 F: 1300 729 528 E:info@emeraldresources.com.au

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1. Subject to any restrictions imposed by ASX, Shares issued pursuant to an exercise of EMR Options shall rank, from the date of issue, pari passu with existing Shares in all respects.

2. EMR Options carry no right to participate in pro rata issues of securities to shareholders unless the EMR Options are exercised before the record date for determining entitlements to the relevant pro rata issue.

3. Each EMR Option Holder will be notified by the Company of any proposed pro rata issue of securities to shareholders in accordance with ASX Listing Rules.

4. In the event of a reorganisation (including reconstruction, consolidation, subdivision, reduction, or return) of the capital of the Company, the terms of the EMR Options will be changed to the extent necessary to comply with the requirements of the Corporations Act and ASX Listing Rules (in force at the time of the reorganisation).

5. Except as noted in paragraph 11 above, a EMR Option does not confer the right to a change in exercise price or a change in the number of underlying securities over which the EMR Option can be exercised.

6. Any unvested options will lapse upon cessation of employment or termination of services agreement and any vested options will lapse if not exercised within 3 months of the cessation of employment or termination of services agreement. The options will fully vest in the event of a change of control event or at the Board’s discretion.

Emerald Resources NL ACN 009 795 046 1110 Hay Street, WEST PERTH, WA, AUSTRALIA, 6005 PO Box 1408 West Perth WA 6872 T: 1300 729 543 F: 1300 729 528 E:info@emeraldresources.com.au

Appendix 3B New issue announcement

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX’s property and may be made public.

Introduced 01/07/96 Origin: Appendix 5 Amended 01/07/98, 01/09/99, 01/07/00, 30/09/01, 11/03/02, 01/01/03, 24/10/05, 01/08/12, 04/03/13

Name of entity

Emerald Resources NL

ABN

72 009 795 046

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

1 +Class of +securities issued or to be issued 2 Number of +securities issued or to be issued (if known) or maximum number which may be issued 3 Principal terms of the +securities (e.g. if options, exercise price and expiry date; if partly paid +securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)	Unlisted Options
	20,000,000 unlisted $0.025 options, expiring 21 January 2020
	Unlisted $0.025 options, expiring 21 January 2020

• See chapter 19 for defined terms.

Appendix 3B Page 1

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Appendix 3B New issue announcement

4 Do the[+] securities rank equally Upon exercise of the options, the shares will in all respects from the[+] issue rank equally with the fully paid ordinary date with an existing[+] class of shares currently on issue. quoted[+] securities? If the additional[+] securities do not rank equally, please state:  the date from which they do  the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment  the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration Nil 6 Purpose of the issue Issue of 20,000,000 unlisted $0.025 options, (If issued as consideration for expiring 21 January 2020 to employees and the acquisition of assets, clearly consultants as an incentive component of identify those assets) their remuneration packages. 6a Is the entity an[+] eligible entity Yes that has obtained security holder approval under rule 7.1A? If Yes, complete sections 6b – 6h in relation to the[+] securities the subject of this Appendix 3B , and comply with section 6i 6b The date the security holder 27 November 2014 resolution under rule 7.1A was passed 6c Number of +securities issued Nil without security holder approval under rule 7.1

• See chapter 19 for defined terms.

Appendix 3B Page 2

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Appendix 3B New issue announcement

6d Number of +securities issued with security holder approval under rule 7.1A 6e Number of +securities issued with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting) 6f Number of +securities issued under an exception in rule 7.2 6g If +securities issued under rule 7.1A, was issue price at least 75% of 15 day VWAP as calculated under rule 7.1A.3? Include the +issue date and both values. Include the source of the VWAP calculation. 6h If +securities were issued under rule 7.1A for non-cash consideration, state date on which valuation of consideration was released to ASX Market Announcements 6i Calculate the entity’s remaining issue capacity under rule 7.1 and rule 7.1A – complete Annexure 1 and release to ASX Market Announcements 7 +Issue dates Note: The issue date may be prescribed by ASX (refer to the definition of issue date in rule 19.12). For example, the issue date for a pro rata entitlement issue must comply with the applicable timetable in Appendix 7A. Cross reference: item 33 of Appendix 3B. 8 Number and +class of all +securities quoted on ASX (including the +securities in section 2 if applicable)	Nil	Nil
	Nil
	20,000,000 unlisted $0.025 options, expiring 21 January 2020 issued in accordance with the Company’s Employee Option Plan as approved by shareholders on 27 November 2014.
	N/A
	N/A
	Refer Annexure
	22 January 2015
	Number	+Class
	1,306,594,114	Fully paid ordinary shares

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Number +Class 9 Number and +class of all 20,000,000 Unlisted $0.025 +securities not quoted on ASX options, expiring ( including the +securities in 21 January 2020 section 2 if applicable)

• 10 Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests)

The Company does not have a dividend policy.

Part 2 - Pro rata issue

11 Is security holder approval required? 12 Is the issue renounceable or non- renounceable? 13 Ratio in which the +securities will be offered 14 +Class of +securities to which the offer relates 15 +Record date to determine entitlements 16 Will holdings on different registers (or subregisters) be aggregated for calculating entitlements? 17 Policy for deciding entitlements in relation to fractions 18 Names of countries in which the entity has security holders who will not be sent new offer documents Note: Security holders must be told how their entitlements are to be dealt with. Cross reference: rule 7.7. 19 Closing date for receipt of acceptances or renunciations	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

20 Names of any underwriters 21 Amount of any underwriting fee or commission 22 Names of any brokers to the issue 23 Fee or commission payable to the broker to the issue 24 Amount of any handling fee payable to brokers who lodge acceptances or renunciations on behalf of security holders 25 If the issue is contingent on security holders’ approval, the date of the meeting 26 Date entitlement and acceptance form and offer documents will be sent to persons entitled 27 If the entity has issued options, and the terms entitle option holders to participate on exercise, the date on which notices will be sent to option holders 28 Date rights trading will begin (if applicable) 29 Date rights trading will end (if applicable) 30 How do security holders sell their entitlements in full_through a broker? 31 How do security holders sell_part of their entitlements through a broker and accept for the balance?	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

32 How do security holders dispose of their entitlements (except by sale through a broker)?

33 +Issue date

N/A N/A

Part 3 - Quotation of securities

You need only complete this section if you are applying for quotation of securities

34 Type of[+] securities ( tick one )

• (a) +Securities described in Part 1

(b) All other[+] securities

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

35 If the[+] securities are[+] equity securities, the names of the 20 largest holders of the additional[+] securities, and the number and percentage of additional[+] securities held by those holders

36 If the[+] securities are[+] equity securities, a distribution schedule of the additional +securities setting out the number of holders in the categories

1 - 1,000

1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,001 and over

37 A copy of any trust deed for the additional[+] securities

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Entities that have ticked box 34(b)

38 Number of[+] securities for which N/A +quotation is sought 39 +Class of +securities for which N/A quotation is sought 40 Do the[+] securities rank equally in N/A all respects from the[+] issue date with an existing[+] class of quoted +securities? If the additional +securities do not rank equally, please state:  the date from which they do  the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment  the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 41 Reason for request for quotation N/A now Example: In the case of restricted securities, end of restriction period (if issued upon conversion of another[+] security, clearly identify that other[+] security) Number +Class 42 Number and +class of all N/A +securities quoted on ASX ( including the[+] securities in clause 38)

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Quotation agreement

• 1 +Quotation of our additional +securities is in ASX’s absolute discretion. ASX may quote the[+] securities on any conditions it decides.

• 2 We warrant the following to ASX.

• The issue of the[+] securities to be quoted complies with the law and is not for an illegal purpose.

• There is no reason why those +securities should not be granted +quotation.

• An offer of the[+] securities for sale within 12 months after their issue will not require disclosure under section 707(3) or section 1012C(6) of the Corporations Act.

  • Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any[+] securities to be quoted and that no-one has any right to return any[+] securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the[+] securities be quoted.

• If we are a trust, we warrant that no person has the right to return the +securities to be quoted under section 1019B of the Corporations Act at the time that we request that the[+] securities be quoted.

• 3 We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.

• 4 We give ASX the information and documents required by this form. If any information or document is not available now, we will give it to ASX before +quotation of the +securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

Mark Clements Company Secretary 22 January 2015

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Appendix 3B – Annexure 1

Calculation of placement capacity under rule 7.1 and rule 7.1A for eligible entities

Introduced 01/08/12 Amended 04/03/13

Part 1

Rule 7.1 – Issues exceeding 15% of capital

Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

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Insert number of fully paid [+] ordinary
943,651,304
securities on issue 12 months before the
+ issue date or date of agreement to issue
Add the following:
• Number of fully paid [+] ordinary securities
issued in that 12 month period under an
exception in rule 7.2
• Number of fully paid [+] ordinary securities
issued in that 12 month period with
shareholder approval
5 August 2014 Share Issue
457,307,940
• Number of partly paid [+] ordinary
securities that became fully paid in that
12 month period
Note:
• Include only ordinary securities here –
other classes of equity securities cannot
be added
• Include here (if applicable) the securities
the subject of the Appendix 3B to which
this form is annexed
• It may be useful to set out issues of
securities on different dates as separate
line items
Subtract the number of fully paid [+] ordinary
securities cancelled during that 12 month
94,365,130
period
“A” 1,306,594,114
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• See chapter 19 for defined terms.

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Step 2: Calculate 15% of “A”

Step 2: Calculate 15% of “A”	Step 2: Calculate 15% of “A”
“B”	0.15 [Note: this value cannot be changed]
Multiply“A” by 0.15	195,989,117
Step 3: Calculate “C”, the amount of placement capacity under rule 7.1 that has already been used
Insertnumber of +equity securities issued or agreed to be issued in that 12 month period_not counting_those issued: • Under an exception in rule 7.2 • Under rule 7.1A • With security holder approval under rule 7.1 or rule 7.4 Note: • This applies to equity securities, unless specifically excluded – not just ordinary securities • Include here (if applicable) the securities the subject of the Appendix 3B to which this form is annexed • It may be useful to set out issues of securities on different dates as separate line items
“C”	Nil
Step 4: Subtract “C” from [“A” x “B”] to calculate remaining placement capacity under rule 7.1
“A” x 0.15 Note: number must be same as shown in Step 2	195,989,117
Subtract“C” Note: number must be same as shown in Step 3	Nil
Total[“A” x 0.15] – “C”	195,989,117 [Note: this is the remaining placement capacity under rule 7.1]

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Insert number of [+] equity securities issued
or agreed to be issued in that 12 month
period not counting those issued:
• Under an exception in rule 7.2
• Under rule 7.1A
• With security holder approval under rule
7.1 or rule 7.4
Note:
• This applies to equity securities, unless
specifically excluded – not just ordinary
securities
• Include here (if applicable) the securities
the subject of the Appendix 3B to which
this form is annexed
• It may be useful to set out issues of
securities on different dates as separate
line items
“C” Nil
Step 4: Subtract “C” from [“A” x “B”] to calculate remaining
placement capacity under rule 7.1
“A” x 0.15
Note: number must be same as shown in 195,989,117
Step 2
Subtract “C”
Note: number must be same as shown in Nil
Step 3
Total [“A” x 0.15] – “C” 195,989,117
[Note: this is the remaining placement
capacity under rule 7.1]
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• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Part 2

Rule 7.1A – Additional placement capacity for eligible entities

Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

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“A”
Note: number must be same as shown in 1,306,594,114
Step 1 of Part 1
Step 2: Calculate 10% of “A”
“D” 0.10
Note: this value cannot be changed
Multiply “A” by 0.10 130,659,411
Step 3: Calculate “E”, the amount of placement capacity under rule
7.1A that has already been used
Insert number of [+] equity securities issued
or agreed to be issued in that 12 month
period under rule 7.1A
Notes:
• This applies to equity securities – not
just ordinary securities
• Include here – if applicable – the
securities the subject of the Appendix
3B to which this form is annexed
• Do not include equity securities issued
under rule 7.1 (they must be dealt with
in Part 1), or for which specific security
holder approval has been obtained
• It may be useful to set out issues of
securities on different dates as separate
line items
“E” Nil
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• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A

Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A	Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A
“A” x 0.10 Note: number must be same as shown in Step 2	130,659,411
Subtract“E” Note: number must be same as shown in Step 3	Nil
Total[“A” x 0.10] – “E”	130,659,411 Note: this is the remaining placement capacity under rule 7.1A

• See chapter 19 for defined terms.

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