EMU NL - Proxy Solicitation & Information Statement 2013

EMU NICKEL NL ACN 127 291 927

NOTICE OF GENERAL MEETING EXPLANATORY MEMORANDUM

AND

PROXY FORM

Date of Meeting 11 April 2013

Time of Meeting 2:00 pm (WST)

Place of Meeting 10 Walker Avenue West Perth, Western Australia 6005

This Notice of General Meeting and Explanatory Memorandum should be read in their entirety.

An Independent Expert’s Report is attached to this Notice, in Annexure A, as required by ASIC Regulatory Guide 74.

If Shareholders are in doubt as to how they should vote, they should seek advice from their accountant, solicitor or other professional adviser prior to voting. Should you wish to discuss the matters in this Notice of Meeting please do not hesitate to contact the Managing Director on +61 8 9226 4266

EMU NICKEL NL Notice of General Meeting 11 April 2013

EMU NICKEL NL ACN 127 291 927 NOTICE OF GENERAL MEETING

Notice is given that a general meeting of the Shareholders of Emu Nickel NL ( Company ) will be held at 10 Walker Avenue, West Perth, Western Australia 6005 on Thursday, 11 April 2013 at 2.00 pm (WST) to consider, and if thought fit, pass the Resolutions set out below.

Resolution 1 – Change to nature and scale of activities

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

“Subject to Resolution 2 being passed, that for the purpose of Listing Rule 11.1.2 and for all other purposes, the Company be authorised to make a significant change in the nature and scale of its activities to include diamond operations in South Africa.”

Voting Exclusion: The Company will disregard any votes cast on this Resolution by a person who might obtain a benefit (except a benefit solely in the capacity of a holder of ordinary securities) if the Resolution is passed, and any associates of that person. However, the Company will not disregard a vote if it is cast by a person as 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 Meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides.

Resolution 2 – Ratification of the Acquisition of Superkolong Proprietary Limited

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

“Subject to Resolution 1 being passed, Shareholders ratify the acquisition of 50% of the issued share capital of Superkolong Proprietary Limited on the terms and conditions set out in the Explanatory Memorandum."

Resolution 3 – Change of Company Name

To consider and, if thought fit, to pass, with or without amendment, the following resolution as a special resolution :

“That for the purposes of section 157(1)(a) of the Corporations Act 2001, and for all other purposes, the name of the Company be changed to Emu NL”

Resolution 4 – Approval of placement of Contributing Shares to a Related Party

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

“Subject to Resolutions 5 and 6 being passed, that for the purposes of Listing Rule 10.11 and section 611 (item 7) of the Corporations Act, and all other purposes, the Shareholders approve:

(i) the issue and allotment of 14,747,964 Contributing Shares partly paid on application as to $0.03 with the unpaid amount being $0.03 to Bullantco Pty Ltd (an entity associated with Mr Thomas and Mr Steemson); and
(ii) the increase in the Voting Power of Bullantco Pty Ltd as a result of the issue of the Contributing Shares the subject of (i) above, and the conversion of those Contributing Shares to Shares upon payment of the unpaid amount on the Contributing Shares by Bullantco Pty Ltd,

on the terms and conditions in the Explanatory Memorandum.”

EMU NICKEL NL Notice of General Meeting 11 April 2013

Voting Exclusion: The Company will disregard any votes cast on this Resolution by Bullantco Pty Ltd and any Associate of Bullantco Pty Ltd, including Mr Peter Thomas and Mr Greg Steemson. However, the Company will not disregard a vote if it is cast by a person as 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 Meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides.

Independent Expert’s Report: Shareholders should carefully consider the Independent Expert’s Report prepared by Stantons International Securities for the purposes of the Shareholder approval required under section 611 (item 7) of the Corporations Act. The Independent Expert’s Report comments on the fairness and reasonableness of the proposed issue of Contributing Shares under Resolution 4 to the non-associated shareholders of the Company. The Independent Expert has determined that the issue of Contributing Shares the subject of Resolution 4 is not fair but reasonable to the non-associated shareholders of the Company.

Resolution 5 – Approval for the increase in Voting Power of Mr Peter Thomas

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

“Subject to Resolutions 4 and 6 being passed, that for the purposes of section 611 (item 7) of the Corporations Act and for all other purposes, Shareholders approve the increase in the Voting Power of Mr Peter Thomas or his nominees as a result of:

(i) the issue of Contributing Shares to Bullantco Pty Ltd;
(ii) any conversion of the Contributing Shares issued to Bullantco Pty Ltd to Shares upon payment of the unpaid amount on the Contributing Shares by Bullantco Pty Ltd; and
(iii) any conversion of the Contributing Shares held by Mr Peter Thomas or his nominees to Shares upon payment of the unpaid amount on the Contributing Shares,

on the terms set out in the Explanatory Memorandum.”

Resolution 6 – Approval for the increase in Voting Power of Mr Greg Steemson

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

“Subject to Resolution 4 and 5 being passed, that for the purposes of section 611 (item 7) of the Corporations Act and for all other purposes, Shareholders approve the increase in the Voting Power of Mr Greg Steemson or his nominees as a result of:

(i) the issue of Contributing Shares to Bullantco Pty Ltd;
(ii) any conversion of the Contributing Shares issued to Bullantco Pty Ltd to Shares upon payment of the unpaid amount on the Contributing Shares by Bullantco Pty Ltd; and
(iii) any conversion of the Contributing Shares held by Mr Greg Steemson or his nominees to Shares upon payment of the unpaid amount on the Contributing Shares,

on the terms set out in the Explanatory Memorandum.”

EMU NICKEL NL Notice of General Meeting 11 April 2013

Explanatory Memorandum

The Explanatory Memorandum accompanying this Notice provides additional information on matters to be considered at the meeting. The Explanatory Memorandum and the Proxy Form are part of this Notice.

Capitalised terms used in this Notice and Explanatory Memorandum will, unless the context otherwise requires, have the same meaning given to them in the glossary contained in the Explanatory Memorandum.

Proxy Form

A Proxy Form is attached.

To be valid, properly completed Proxy Forms must be received by the Company no later than 2.00 pm (WST) on 9 April 2013:

by post to: PO Box 535
APPLECROSS WA 6953
by facsimile on +61 8 9315 2233
by email to [email protected]

By order of the Board

==> picture [127 x 55] intentionally omitted <==

Dennis Wilkins Joint Company Secretary Date: 8 March 2013

EMU NICKEL NL Notice of General Meeting 11 April 2013

PROXIES

A Shareholder entitled to attend and vote at the Meeting may appoint not more than two proxies. Where more than one proxy is appointed, each proxy must be appointed to represent a specified proportion of the Shareholder's voting rights.

A proxy may, but need not be, a Shareholder of the Company.

The instrument appointing the proxy must be in writing, executed by the appointor or his attorney duly authorised in writing or, if such appointor is a corporation, either under seal or under hand of an officer duly authorised.

The instrument of proxy (and the power of attorney or other authority, if any, under which it is signed) must be lodged by person, post, courier or facsimile and reach the registered office of the Company at least 48 hours prior to the meeting. For the convenience of Shareholders a Proxy Form is enclosed.

ENTITLEMENT TO VOTE

For the purposes of regulation 7.11.37 of the Corporations Regulations 2001, the Company determines that members holding Shares at 5:00 pm WST on 9 April 2013 will be entitled to attend and vote at the Meeting.

CORPORATIONS

Any corporate Shareholder who has appointed a person to act as its corporate representative at the Meeting should provide that person with a certificate or letter executed in accordance with the Corporations Act authorising him or her to act as the company’s representative. The authority may be sent to the Company in advance of the Meeting or handed in at the Meeting when registering as a corporate representative.

EMU NICKEL NL Notice of General Meeting 11 April 2013

EXPLANATORY MEMORANDUM

This Explanatory Memorandum has been prepared for the Shareholders of Emu Nickel NL ACN 127 291 927 ( Company ) in connection with the business to be conducted at the General Meeting of the Company to be held at 10 Walker Avenue, West Perth, Western Australia 6005, on Thursday, 11 April 2013 commencing at 2.00 pm (WST).

This Explanatory Memorandum should be read in conjunction with, and form part of, the accompanying Notice.

The Directors recommend that Shareholders read this Explanatory Memorandum in full before making any decision in relation to the Resolutions.

Terms used in this Explanatory Memorandum will, unless the context otherwise requires, have the same meaning given to them in the glossary as contained in this Explanatory Memorandum.

1. OVERVIEW

1.1 Background to the Acquisition

The Company was incorporated in Western Australia on 29 August 2007 to undertake exploration for base metal mineralisation, primarily nickel, in the Yilgarn Carton of Western Australia pursuant to an earn-in and joint venture agreement with Image Resources NL (ASX: IMA).

On 27 February 2008, the Company was admitted to the official list of the ASX. Since the Company’s admission to ASX it has pursued the objectives stated in its initial public offering prospectus but it has not been able to generate a company making prospect, which, in the context of market sentiment, has prompted the Company to examine alternative project opportunities.

During 2011 and 2012 the Company reviewed many mineral exploration opportunities and disclosed to Shareholders (and the general market) that it would re-evaluate its Western Australian projects and investigate new opportunities directed at adding significant value to the Company. On 28 December 2012, the Company informed Shareholders that it was assessing several mining and development opportunities principally in Africa including diamond operations (including a number of discrete and entirely separate unrelated primary kimberlite, tailings retreatment and alluvial operations) and tantalite exploration and development projects.

On 27 February 2013, the Company announced to ASX that the Company had entered into an agreement to acquire 50% of Superkolong Proprietary Limited ( SK ) (an unrelated entity) from the Vendors ( Sale Agreement ) and the acquisition will become unconditional and effective on 1 March 2013. On 4 March 2013, the Company announced to ASX that the acquisition of SK had been completed.

The Company’s objective following the acquisition of SK is to continue reviewing new mining and development opportunities with potential to add significant value to the Company and compliment the Company’s existing operations.

1.2 Acquisition of Superkolong Proprietary Limited

On 1 March 2013, the Company and El Nino Mining Proprietary Limited (an unrelated entity, incorporated in South Africa and a subsidiary of Batla Minerals S.A., an entity listed on the NYSE Euronext (Marche Libre) in Paris) ( El Nino ) each separately acquired, indirectly, 50% of the entire issued share capital in and claims on loan account against SK via a special purpose entity registered in South Africa ( SPV ). SK is a private company incorporated in South Africa with a 30.4% interest in a tailings re-treatment project in Kimberley, South Africa, via its shareholding in Kimberley Miners Forum Proprietary Limited ( KMF ).

KMF has purchased various coarse diamondiferous, kimberlite tailings dumps ( Tailings Dumps ) around the town of Kimberley in South Africa and the right to process the dump material from De Beers Consolidated Mining ( DBCM ). SK operates a diamond tailings processing and recovery plant on land leased from DBCM adjacent to the largest Tailings Dump purchased by KMF known as Chrono 1. Please refer to section 1.4 of this Explanatory Memorandum for details on the assets and operations of SK.

The following agreements govern the Acquisition:

(a) Sale Agreement between the Vendors, the SPV and SK;
(b) Escrow Agreement between the Vendors, the SPV and SK dated 15 February 2013;

EMU NICKEL NL Notice of General Meeting 11 April 2013

(c) Cession and Assignment Agreement between Rosyblue Manufacturing Pty Ltd ( RB ), the SPV and SK 15 February 2013; and
(d) Loan Agreement between Emu Blue Pty Ltd and the SPV dated 15 February 2013 governs the cash flow between the Company (via its subsidiary Emu Blue Pty Ltd) and the SPV.

These agreements are inter-conditional, with the effective date under each agreement being 1 March 2013. The key terms of the agreements are summarised below.

1.3 Key terms of the Acquisition

The key terms of the Acquisition are as follows:

(a) Cash Consideration: The Company has paid (in the case of the first instalment) or will pay the following amounts, representing the Company’s proportion of the purchase price, via the SPV to complete the Acquisition:
(i) the first instalment of ZAR17.5 million (equivalent to A$1.80 million based on an exchange rate of AUD1:ZAR 9.17 on 14 February 2013) paid on 1 March 2013 utilising the Company’s existing cash reserves;
(ii) the second instalment of ZAR12.5 million (equivalent to A$1.36 million based on an exchange rate of AUD1:ZAR 9.17) cash will be due on 1 September 2013;
(iii) the third instalment of ZAR17.5 million (equivalent to A$1.91 million based on an exchange rate of AUD1:ZAR 9.17) cash will be due on 1 March 2014; and
(iv) the final instalment of ZAR17.5 million (equivalent to A$1.91 million based on an exchange rate of AUD1:ZAR 9.17) cash will be due on 1 September 2014.

The cash consideration will be apportioned amongst the Vendors in accordance with the number of SK Shares held.

The Company proposes to fund the deferred cash consideration to be paid of ZAR47.5 million (equivalent to A$5.18 million) through surplus cash generated from SK’s operations.

If there are insufficient surplus funds to pay the deferred consideration to the Vendors, then El Nino and Emu can elect to (i) contribute their portion of the deferred consideration via the SPV or (ii) default under the Sale Agreement. In the event that the Company defaults under the Sale Agreement by failing to contribute funds to pay the deferred consideration, then the Vendors may re-take possession and ownership of the shares and assets of SK and retain all monies paid by the Company prior to the default under Sale Agreement and their rights are so limited in that regard.

(b) Transfer of Ownership: on 1 March 2013, the Company and El Nino, via the SPV, acquired full title to the entire share capital of SK free from encumbrances together with the risk and benefit in and to the shares in SK.
(c) Escrow: the shares of SK (share transfer forms and accompanying share certificates) and funds from diamond sales being 30% of sales revenue will be delivered to the escrow agent to be held in escrow until the date that the cash consideration is paid in full and then released to the SPV. In the event that there is a default under the Sale Agreement, the funds and shares in SK will be returned to the Vendors.
(d) Cessation and assignment of the Rosyblue Off-take Agreement: the Company and El Nino, via the SPV, agree to purchase as part of the Sale Agreement, all of the rights and obligations under the Rosyblue Offer-take Agreement from SK and agree to pay ZAR5 million (the Company’s portion of the cessation consideration A$273,000) in cash as consideration for the assignment of the Rosyblue Offtake Agreement. This cash consideration was paid on 1 March 2013.
(e) Board Representation: on 1 March 2013, the Company and El Nino each appointed a nominee to the board of SK and the existing directors of SK will resign apart from one director ( Continuing Director ). Until the entire purchase price is paid in full, the Continuing Director shall remain on the board and the parties agree that SK’s constitution shall be amended to require the consent of the Continuing Director to implement certain actions, including declaration of dividends and issue of shares.
(f) Conditions Precedent: the Acquisition was conditional upon the satisfaction or waiver of the conditions set out below:

EMU NICKEL NL Notice of General Meeting 11 April 2013

(i) approval of the Acquisition by the board of directors of the Vendors and the SPV, including in particular, approvals in accordance with the requirements of section 44 of the South African Companies Act 2008;
(ii) approval of the Acquisition by the South African Take Over Regulation Panel;
(iii) the SPV receiving a South African Revenue Services tax clearance Certificate in respect of SK; and
(iv) approval from the Financial Surveillance Department of the South African Reserve Bank permitting the SPV to receive loan funding from the Company,
all of the above conditions were either satisfied or waived and the Acquisition was completed on 1 March 2013.

1.4 Overview of SK

(a) Background

In 2007, DBCM agreed to sell some of their assets near Kimberley, South Africa, that did not at the time meet their business needs. These assets included some of the kimberlite mine waste dumps adjacent to DBCM’s mines. KMF was formed to purchase a group of these dumps. Ownership of the shares in KMF has changed since 2007, however the current shareholders of KMF are SK with 30.4%, Super Stone Mining Proprietary Limited with a 60.6% interest and Samber Trading No.44 Proprietary Limited with the balance (9%).

SK and the other two shareholders of KMF have been operating plants to process the Tailings Dumps since 2007, initially under a service contract with DBCM and from 27 February 2008 in their own right (via arrangements with KMF), after KMF purchased the Tailings Dumps from DBCM ( DBCM Contract ). The DBCM Contract provides KMF’s shareholders (which include SK) with access to Tailings Dumps for a 10 year term expiring on 26 February 2018, unless the DBCM Contract is extended.

Under the DBCM Contract, Tailings Dump material is delivered to each KMF shareholder in proportion to their respective equity interest and treated by each party in their own plants. The SK plant currently processes up to 150,000 tpm of Tailings Dump material and recovers up to 15,000 carats of diamonds per month. The diamonds recovered from the dumps range from industrial type goods through to gem quality diamonds. In general, the value per diamond type of (carats recovered x price) is reasonably consistent. The average price per carat received by SK via tender during 2012 for diamonds recovered was ~US$100/ct.

(b) Tailings Dump Material

KMF currently sources Tailings Dump material from two sources. The main Tailings Dump material currently being processed is being sourced from a series of small dumps around the Kimberley ( Outer Dumps ). The recovered grade from these Outer Dumps varies between 7 and 9cpht. It is estimated by the Company that there is approximately 8Mt of diamondiferous material left in these Outer Dumps.

The largest remaining Tailings Dump purchased by KMF is known as Chrono 1, which is located adjacent to SK’s plant site. Chrono 1 is estimated by DBCM to contain 42.7Mt of diamondiferous tailings. This large dump was created by DBCM between 1959 and 1970 after which period improving technology (introduction of DMS plants amongst other things) reduced the grade of diamonds being deposited by DBCM in the Tailings Dumps. During March to December 2012 SK processed 206,000t from Chrono 1.

As at 31 December 2012, the remaining Tailings Dump material owned by KMF were:

Tailings Source	Tonnage	Estimated Grade (cpht)	Category
	(Mt)
Outer Dumps	8.0Mt	8.0cpht	Inferred (1)
Chrono 1 Dump	42.7Mt	6.15cpht	Indicated (2)

Notes:

(1) Volumes based on estimates by DBCM. Grades based on weighted average recovered grade for 2012. Tonnage factor determined by plant throughput.

EMU NICKEL NL Notice of General Meeting 11 April 2013

(2) Volume estimated by DBCM. Grade determined by weighted average grade of bulk samples collected by Large Diameter Auger ( LDA ) (Bauer Rig). Tonnage factor determined by DBCM using weight of bulk sample and hole volume.

SK has a 30.4% entitlement to Outer Dumps and Chrono 1 Dump.

During the period August 2003 to August 2005 DBCM completed a Large Diameter Auger ( LDA ) program consisting of 154 holes to estimate the grade of the Chrono 1, 2, 3 and 4 dumps (which are more or less continuous). Holes were usually 50 to 60m long (being the height of the dumps) and samples were usually composited into 5m intervals. 760 bulk samples (25,079 tons) were processed through the Kimberley Mines Sampling Plant of DBCM between March 2004 and October 2006. The average recovered grade for Chronos 1, 2, 3 and 4 was estimated by DBCM at 5.11cpht.

The LDA results show the grade of Chrono 1 slowly decreasing over time as technology improved. The weighted average recovered grade of this bulk sampling program for Chrono 1 was estimated by the Company and El Nino at 6.15cpht with the grades from the early years of the dump being > 7cpht.

1.5 Effect of the Acquisition on the Company

(a) Effect on the Company’s Board or Senior Management

There will be no change to the Company’s board or senior management team as a result of the Acquisition.

(b) Effect on the Company’s Share Capital

The Company’s capital structure will not change as a result of the Acquisition. The Company intends to fund the Acquisition via cash. The Company has already funded the first instalment of the consideration through its existing cash reserves. The Company currently has 34,642,856 listed fully paid ordinary shares ( Shares ) on issue and 19,894,892 unlisted partly paid Contributing Shares. The capital structure will remain unchanged on completion of the Acquisition (assuming no options are exercised). However, subject to Resolutions 4 to 6 being passed, the Company will issued a further 14,747,964 Contributing Shares.

(c) Effect on the Company’s Exploration Expenditure on its existing tenements

On 31 December 2012, the Company held a participating interest in approximately 20 tenements and during January 2013, a number of these tenements were surrendered as a result of joint ventures being terminated or Emu withdrawing from joint ventures. As a result of these surrenders during the normal course of business, the Company currently holds a participating interest in approximately five tenements.

The Company’s exploration expenditure for the 12 months ended 31 December 2012 was $294,000 and the Company’s forecast exploration expenditure for the 12 months beginning 1 January 2013 is $250,000.

(d) Effect on the Company’s Financial Position and Future Potential Earnings

The Company anticipates that the Acquisition will not have an effect on the Company’s total assets, equity interests or revenue position. However, the Acquisition will result in an approximately $2.7 million change in the Company’s annual profit/loss position. The Company’s annual exploration expenditure on its existing tenements is not forecast to materially change as a result of the Acquisition.

The Company indicates that the Acquisition may have the following effect on the Company:

	Prior to Transaction – Position of the Company as at 31 December 2012	Post Transaction Analysis – Pro-forma*	Percentage change
Consolidated total assets	A$3,234,973(i)	A$3,234,973	Nil
Consolidated total equity interests	A$3,104,604(ii)	A$3,104,604	Nil
Consolidated Revenue	A$83,909 (half year 31 Dec 2012)	-	Nil

Notice of General Meeting 11 April 2013

EMU NICKEL NL

	Prior to Transaction – Position of the Company as at 31 December 2012	Post Transaction Analysis – Pro-forma*	Percentage change
Consolidated annual profit (before tax and extraordinary items)	A$2,700,000 Loss (full year 30 June 2012) A$397,518 Loss (half year 31 Dec 2012)	Breakeven (full year 30 June 2012) A$950,000 profit (half year 31 Dec 2012)	A$2,700,000 change in annual profit(iii)
Number of tenements that Emu has a participating interest	approx. 20	approx. 5(iv)	(75.0%)
Annual Exploration Expenditure	$294,000	$250,000	(15.0%)

(i) Management prepared statement of financial position as at 31 December 2012 (unaudited).

(ii) Management prepared statement of financial position as at 31 December 2012 (unaudited). (iii) Based on budgets prepared for the Acquisition.

(iv) This reduction in the number of tenements held by Emu occurred during the course of normal business operations and independent of the Acquisition (refer section 1.5(c) above for details).

The Pro-forma financial effect above has not been audited and has been prepared for illustrative purposes only and gives effect to the Acquisition as if it occurred on 31 December 2012. The pro-forma position is not intended to be a statement of the Company’s current financial position.

EMU NICKEL NL Notice of General Meeting 11 April 2013

1.6 Pro-forma Statement of Financial Position

An unaudited pro-forma statement of financial statement of the Company’s statement of financial statement as at 31 December 2012 as a result of the Acquisition is set out below:

Emu Nickel NL Statement of Financial Position 31 December 2012

Current Assets Cash and cash equivalents Trade and other receivables Other assets Total Current Assets Non-Current Assets Receivables Investments accounted for using the equity method Plant and equipment Other financial assets Total Non-Current Assets Total Assets Current Liabilities Trade and other payables Total Current Liabilities Total Liabilities Net Assets Equity Contributed equity Reserves Accumulated losses Total Equity	Actual Proforma after Rights Issue Proforma after Rights Issue and SK Transaction 3,092,882 3,689,799 1,411,085 43,482 43,482 43,482 8,904 8,904 8,904
	3,145,268 3,742,185 1,463,471
	- - 2,278,700 - - 14 2,305 2,305 2,305 87,400 87,400 87,400
	89,705 89,705 2,368,419
	3,234,973 3,831,890 3,831,890
	130,369 130,369 130,369
	130,369 130,369 130,369
	130,369 130,369 130,369
	3,104,604 3,701,521 3,701,521
	9,315,929 9,912,846 9,912,846 124,650 124,650 124,650 (6,335,975) (6,335,975) (6,335,975)
	3,104,604 3,701,521 3,701,521

Notes:

Proceeds from the issue of 1,000 ordinary shares at $0.07 and 19,894,892 Contributing Shares at $0.03.
Payment of loan funds to SPV of ZAR20.85m, translated to A$2,278,700 based on an exchange rate of AUD1:ZAR 8.8 at 31 December 2012.
Payment for share investment in SPV of ZAR120, translated to A$14 based on an exchange rate of AUD1:ZAR8.8 at 31 December 2012.

1.7 Advantages of the Acquisition

The Directors are of the view that the following non-exhaustive list of advantages of the Acquisition may be relevant to a Shareholder’s decision on how to vote on the proposed Resolutions:

(a) the Acquisition represents a significant opportunity for the Company to increase the size of the Company’s assets and projected earnings, which should increase the number and size of the investor pool that may invest in the Company’s shares and thus encourage liquidity in the Company’s shares;
(b) the Acquisition provides an opportunity for the Company to diversify its business to include an overseas diamond producer to complement the Company’s existing exploration portfolio;

EMU NICKEL NL Notice of General Meeting 11 April 2013

(c) the Acquisition is budgeted to generate cash flow immediately and the Company intends to fund the remaining consideration through internally generated cash flow from SK;
(d) the Directors believe that the Acquisition is an opportunity to build substantial value for shareholders through enhanced financial returns generated from the SK operation; and
(e) the Company’s increased size and improved financial position following the Acquisition should improve access to future equity funding (if necessary).

1.8 Disadvantages

The Directors are of the view that the following non-exhaustive list of disadvantages of the Acquisition may be relevant to a Shareholder’s decision on how to vote on the proposed Resolutions:

(a) there are a number of risk factors associated with the Acquisition. Some of the risks are set out in section 1.9 below; and
(b) the Acquisition may not be consistent with the investment objective of all Shareholders.

1.9 Risk Factors

Based on the information available, a non-exhaustive list of risk factors in relation to the Acquisition are as follows:

(a) Currency Risk

The Company’s operations will be subject to exchange rate fluctuations and exchange control and may become subject to other similar restrictions. Such fluctuations may affect the cash flows that the Company realises from its operations, as diamond production is sold in the world market in US dollars but the costs of operating SK will primarily be in ZAR.

(b) Government Actions and Political Risk

The impact of actions by governments may affect the Company’s and El Nino’s activities including such matters as access to lands and infrastructure, compliance with environmental regulations, taxation and royalties.

The Company and El Nino are conducting its activities in South Africa. The Directors believe that the government of South Africa supports the development of natural resources by foreign investors. However, there is no assurance that future political and economic conditions in South Africa will not result in the government of South Africa adopting different policies regarding foreign development and ownership of mineral resources. Any changes in policy may result in legislative changes affecting ownership of assets, taxation, rates of exchange, environment protection, labour relations, repatriation of Emu and El Nino’s ability to carry out diamond recovery operations at SK.

(c) Labour Risk

The Company and El Nino’s operations may be adversely affected by labour disputes or changes in South African labour laws. In South Africa a number of trade unions have close links to various political parties and have had a significant influence as vehicles for social and political reform and in the collective bargaining process. Since 1995, South Africa has enacted various labour laws that enhance the rights of employees, which may impose costs on the Company and El Nino. Significant labour disputes, work stoppages, increased employee expenses as a result of collective bargaining and the cost of compliance with labour laws could disrupt operations and affect the profitability of operations at the diamond recovery plant and future activities undertaken by the Company and El Nino.

(d) Operational Risks

Notwithstanding the intensive investigations undertaken on the project, SK’s operating costs and sustaining capital requirements may change and while the diamond grades are based on high quality data, there may be periods of reduced cash flow due to variations in diamond grades and operational difficulties. Such variations may lead to reduced availability of funds and may require the SPV shareholders to source additional capital.

EMU NICKEL NL Notice of General Meeting 11 April 2013

(e) Counterparty and contractual risk

The Company is a party to a number of agreements that will affect the Company post completion of the Acquisition. The ability of the Company to achieve its stated objectives will depend on the performance of counterparties to each agreement, of their respective obligations under these agreements. If any of the counterparties defaults in the performance of their obligations, it may be necessary for the Company to approach a court to seek a legal remedy.

Legal action instituted in Australia or overseas can be costly. Further, the agreements referred to in section 1.3 are governed by laws or jurisdictions outside Australia. There is a risk that the Company may not be able to seek the legal redress that it could expect under Australian law and generally there can be no guarantee that a legal remedy will ultimately be granted on the appropriate terms.

(f) Reliance on DBCM Contact

SK and the other two shareholders of KMF have been operating since 2008 under the DBCM Contract. Under DBCM Contract, KMF has purchased the Tailings Dumps and the KMF shareholders operate under a working agreement which governs the quantity of Tailings Dump material that is available to each of them. Unless extended, the DBCM Contract expires on 26 February 2018.

(g) Volatility of commodity prices

Historically, commodity prices (including diamonds) have displayed wide ranges and are affected by numerous factors over which the Company does not have any control. These include world production levels, international economic trends, currency exchange fluctuations, expectations for inflation, speculative activity, consumption patterns and global or regional political events.

(h) Litigation

SK is a party to two disputes. The Vendors have agreed to indemnify SK and the SPV from these matters and any other litigation related to matters during their ownership of SK howsoever arising. In particular, the SPV is entitled to withhold R12.5m in escrow from the purchase price should these matters not be resolved before the final instalment of the consideration is made.

2. RESOLUTION 1 – CHANGE IN NATURE AND SCALE OF ACTIVITIES

2.1 General

Listing Rule 11.1.2 provides that if an entity proposes to make a significant change, either directly or indirectly to the nature and scale of its activities, it must obtain the approval of its Shareholders and it must set out in detail the terms of the proposed transaction.

Accordingly, Resolution 1 seeks Shareholder approval under Listing Rule 11.1.2 for the proposed significant change to the nature and scale of its activities by the Acquisition to include diamond operations in South Africa.

Resolution 1 is subject to Resolution 2 being approved by Shareholders.

As outlined in section 1.1 of this Explanatory Memorandum, the Company has entered into the Sale Agreement under which the Company has acquired 50% of the issued share capital of SK.

2.2 Directors’ Recommendation

The Directors unanimously recommend that Shareholders vote in favour of Resolution 1.

The Directors have indicated that they intend to vote the Shares they own or control in favour of the Resolution 1. The Chairman intends to vote all undirected proxies in favour of the Resolution.

3. RESOLUTION 2 – RATIFICATION OF THE ACQUISITION OF SUPERKOLONG PROPRIETARY LIMITED

As outlined in Section 1.1 of this Explanatory Memorandum, the Company acquired under the terms of the Sale Agreement an indirect 50% interest in SK on 1 March 2013.

Resolution 2 is conditional upon Resolution 1 being approved.

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Notice of General Meeting 11 April 2013

3.1 Directors’ Recommendation

The Directors unanimously recommend that Shareholders vote in favour of Resolution 2.

The Directors have indicated that they intend to vote the Shares they own or control in favour of the Resolution 2. The Directors consider that the Acquisition is in the best interests of the Company and its Shareholders. The Chairman intends to vote all undirected proxies in favour of the Resolution.

4. RESOLUTION 3 – CHANGE OF COMPANY NAME

Resolution 3 is a special resolution which seeks Shareholder approval for the Company to change its name from “Emu Nickel NL” to “Emu NL.”

The Directors believe that it is necessary for the Company to change its name to reflect a broader focus of the proposed commercial undertakings of the Company.

The change of name will take effect from when ASIC changes the details of the Company’s registration.

4.1 Directors’ Recommendation

The Directors unanimously recommend that Shareholders vote in favour of this Resolution. The chairman intends to vote undirected proxies in favour of this Resolution.

5. RESOLUTION 4 – APPROVAL OF PLACEMENT OF CONTRIBUTING SHARES TO A RELATED PARTY

5.1 Subscription

Bullantco is willing to subscribe for, and the Company wishes to issue, 14,747,964 Contributing Shares upon payment of $0.03 per Contributing Share with an unpaid amount of $0.03 per Contributing Share. The consideration payable by Bullantco for the Contributing Shares is approximately $442,400.

The issue of the Contributing Shares is subject to and conditional upon the Company obtaining all Shareholder approval required under the Listing Rules and the Corporations Act (including for the purposes of item 7 of section 611 of the Corporations Act to approve the increase in Voting Power of Bullantco and its Associates above 20%) to issue the Contributing Shares to Bullantco.

5.2 Overview of Bullantco and its Associates

Bullantco is a private company, incorporated in Western Australia on 28 July 2010.

Operations and Investments

Bullantco is an investment company which invests in resource projects either directly or indirectly through other corporate entities. Its principal activity since its incorporation has been trading in rough diamonds.

Directors

The directors of Bullantco are Mr Greg Steemson and Mr Peter Thomas.

Shareholders

The number of ordinary fully paid shares on issue in the capital of Bullantco is 48,216,669.

The GH Steemson Family Superannuation Account holds 11,500,000 ordinary fully paid shares in the capital of Bullantco, representing a 23.85% interest in the issued share capital of Bullantco. Mr Greg Steemson is one of two trustees and beneficiaries of this account, the other trustee and beneficiary is his spouse Barbara Fay Steemson.

The Waterford Retirement Plan Account holds 9,250,000 ordinary fully paid shares in Bullantco, amounting to 19.18% of the issued share capital of Bullantco. Mr Peter Thomas is one of two trustees and beneficiaries of this account, the other trustee and beneficiary is his spouse Susan Ann Goodwin.

The remaining 57% of the shares in Bullantco are held by 15 other shareholders with holdings ranging from 8,766,669 shares to 200,000 shares.

EMU NICKEL NL Notice of General Meeting 11 April 2013

The Gavelle Super Fund Account holds 3,000,000 ordinary fully paid shares in the capital of Bullantco, representing 6.22% of the issued share capital of Bullantco. Mr Gavin Rutherfood, who is a Director of the Company, is one of two trustees and beneficiaries of this account, the other trustee and beneficiary is his spouse Michelle Lee Rutherford.

5.3 Listing Rule 10.11 Requirements

Listing Rule 10.11 requires shareholder approval to be obtained where an entity issues, or agrees to issue, securities (which include partly paid shares) to a Related Party of the Company. Subject to Resolutions 4, 5 and 6 being passed, Contributing Shares will be issued to Bullantco, which is a Related Party of the Company by virtue of the fact that it is controlled by Messrs Thomas and Steemson, who are both Directors of the Company. As a result, Shareholder approval under Listing Rule 10.11 is required prior to issuing the Contributing Shares to Bullantco.

Approval under Resolution 4 enables the Company to issue the Contributing Shares and upon the Contributing Shares becoming fully paid, they will form part of the same class of Shares already quoted on ASX and the Company will make an application for the shares to be quoted on the ASX. Further approval under Listing Rule 7.1 is not required on conversion of the Contributing Shares to fully paid ordinary shares.

Approval pursuant to Listing Rule 7.1 is not required in order to issue the Contributing Shares as approval is being obtained under Listing Rule 10.11. Shareholders should note that the issue of the Contributing Shares to Bullantco will not be included in the 15% calculation for the purposes of Listing Rule 7.1.

For the purposes of Listing Rule 10.13, the following information is provided in relation to the issue of Contributing Shares to Bullantco:

(a) the maximum number of Contributing Shares to be issued pursuant to Resolution 4 is 14,747,964;
(b) the Contributing Shares will be issued to Bullantco;
(c) the Contributing Shares will be issued no later than one month after the date of the Meeting;
(d) the Contributing Shares will be issued upon payment of $0.03 per Contributing Shares with an unpaid amount of $0.03;
(e) the terms and conditions of the Contributing Shares are set out in section 5.4 of this Explanatory Memorandum below;
(f) Bullantco is considered a Related Party of the Company by virtue of being an entity controlled by two Directors (Messrs Thomas and Steemson) of the Company; and
(g) the funds raised by the Company pursuant to the issue of Contributing Shares will be applied to supplement the Company’s general working capital.

5.4 Terms and Conditions of the Contributing Shares

The Contributing Shares will rank equally with, and have all the rights, benefits and obligations identical with the Company’s Shares on issue, subject to the following:

Amounts paid & unpaid:	Each Contributing Share: a) is issued in consideration of the sum of $0.03; and b) has an unpaid amount of a further $0.03.
No liability:	Holders have no obligation to meet a call (“Call”) made by the Company for the payment of any of the unpaid amount; however, non-payment of a properly made call will result in the forfeiture of the relevant Contributing Shares.
Earliest Call:	The Company shall not make a Call unless the day on which the call is made falls after the 1stanniversary of the issue of the Contributing Share or such later date or dates as determined by the Board from time to time in its absolute discretion.

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Notice of General Meeting 11 April 2013

Capital re- organisation:	If there is a re-organisation of the issued capital of the Company (including, but not limited to, a consolidation, subdivision, cancellation, reduction or return of capital): a) the number of Contributing Shares must be reorganised in the same proportion as all other classes of shares on issue; and b) the re-organisation must not involve a cancellation or reduction of the total amount payable and unpaid by holders of Contributing Shares.
Rights:	Irrespective of whether the Company has made a Call for the payment of all or any of the unpaid amount, each Contributing Share: a) carries the right to participate in new issues (except bonus issues) of securities made to holders of Shares as if the Contributing Shares were fully paid Shares; b) carries the right to participate in bonus issues of securities in the proportion which the amount paid (or, if applicable, aggregate of amounts paid) (not credited) bears to the total of the amounts paid and payable and each holder (“Holder”) of a Contributing Share will be notified by the Company of any proposed bonus issue of securities at least 7 days prior to the record date for any such issue; c) entitles the Holder to (i) exercise voting rights on a pro-rata basis in the proportion which the amount (or, if applicable, aggregate of amounts) paid bears to the total of the amounts paid and payable; and (ii) fully participate in dividends as if the Contributing Shares were a fully paid Share; d) is freely transferable; e) upon being paid up in full shall rank equally in all respects with Shares then on issue and the Company shall promptly apply for them to be listed on the ASX (and each or any other exchange on which shares of the Company are traded).
Payment before a Call:	A Holder may pay up the whole of the amount remaining unpaid at any time PROVIDED THAT they may only do so in parcels: a) of not less than 50,000; or b) of less than 50,000 if the parcel has been held by the holder since its issue, it represents the Holder’s entire holding of Contributing Shares and the Holder has not previously paid up any Contributing Shares; otherwise no amount unpaid may be paid in advance of a Call without the leave of the Board (which leave may be granted with or without reason and either with or without conditions) - the Board shall have no obligation to consider any application for leave. The Company shall not be obliged to process payments without a Call more than once every three months.
	Subject to the foregoing, if a Holder tenders all or part of the amount remaining unpaid on a Contributing Share other than in satisfaction of a Call: a) the rights attaching to the Contributing Share will not change (including the amounts paid and unpaid); and b) the amount tendered will, at the election of the Company, either be returned or retained as a non interest bearing loan repayable only upon and to the extent of a Call being made then the repayment shall be made by the Company to itself in satisfaction of the Call to that extent.
Listing of Contributing Shares:	The Company may apply to list the Contributing Shares at its election and shall do so upon request in that regard being made by a Holder(s) of 5% or more of the outstanding Contributing Shares PROVIDED THAT the conditions to listing the same (save for the application that they be listed) have been met.
Compliance with Listing Rules:	For so long as the Company is admitted to the official list of ASX, the following paramount provisions will apply: a) notwithstanding anything contained in these terms of issue, if the Listing Rules (in

Notice of General Meeting 11 April 2013

EMU NICKEL NL

	the form and context in which they exist as at the date the first Contributing Share is issued) (“Existing Rules”) prohibit an act from being done, the act shall not be done; b) nothing contained in these terms of issue prevent an act being done that the Existing Rules require to be done; c) if the Existing Rules require an act to be done or not be done, authority is given for that act to be done or not done as the case may be; d) if the Existing Rules require these terms of issue to contain a provision and it does not contain such a provision, these terms of issue are deemed to contain such a provision; e) if the Existing Rules require these terms of issue not to contain a provision and it contains such a provision, these terms of issue are deemed not to contain that provision; and f) if any provision of these terms of issue is inconsistent with the Existing Rules, these terms of issue are deemed not to contain that provision to the extent of the inconsistency.
Interpretation:	The Contributing Shares are subject to the terms of the Constitution but if there is any inconsistency between the Constitution and these terms of issue, then to the maximum extent permitted by law, these terms of issue will prevail.

the form and context in which they exist as at the date the first Contributing Share
is issued) (“Existing Rules”) prohibit an act from being done, the act shall not be
done;
b) nothing contained in these terms of issue prevent an act being done that the
Existing Rules require to be done;
c) if the Existing Rules require an act to be done or not be done, authority is given for
that act to be done or not done as the case may be;
d) if the Existing Rules require these terms of issue to contain a provision and it does
not contain such a provision, these terms of issue are deemed to contain such a
provision;
e) if the Existing Rules require these terms of issue not to contain a provision and it
contains such a provision, these terms of issue are deemed not to contain that
provision; and
f)
if any provision of these terms of issue is inconsistent with the Existing Rules,
these terms of issue are deemed not to contain that provision to the extent of the
inconsistency.

Interpretation:

The Contributing Shares are subject to the terms of the Constitution but if there is any
inconsistency between the Constitution and these terms of issue, then to the maximum
extent permitted by law, these terms of issue will prevail.

5.5 Chapter 2E of the Corporations Act

Chapter 2E of the Corporations Act prohibits a public company from giving a financial benefit to a related party of the public company unless either:

(a) the giving of the financial benefit falls within an exception to the prohibition under section 210 to 216 of the Corporations Act; or
(b) prior shareholder approval is obtained to the giving of the financial benefit.

A “related party” for the purposes of the Corporations Act is defined widely. It includes a director of a public company and specified members of the director’s family. It also includes an entity over which a director maintains control.

A “financial benefit” for the purposes of the Corporations Act is also defined widely. It includes a public company issuing securities to a related party.

For the purposes of Chapter 2E, Bullantco is a Related Party of the Company receiving a financial benefit because Bullantco is controlled by Peter Thomas and Greg Steemson, who are both directors of the Company.

The Board considers that the proposed issue of Contributing Shares falls within the arm’s length terms exception under section 210 of the Corporation Act and therefore Shareholder approval under Chapter 2E is not required. Bullantco is being offered Contributing Shares on the same arm’s length terms as parties, who are not related parties of the Company, who subscribed for Contributing Shares under the Company’s recent Rights Issue.

5.6 Section 611 item 7 of the Corporations Act

Resolution 4 also seeks Shareholder approval for the increase in Voting Power of Bullantco and the Bullantco Associates as a result of the issue of the Contributing Shares and any conversion of the Contributing Shares into Shares. Full details of the change in Voting Power of Bullantco and the Bullantco Associates and the specific disclosure requirements under the Corporations Act are set out in section 6 of this Explanatory Memorandum.

5.7 Directors’ Recommendation

Refer to section 6.6 of this Explanatory Memorandum for the Directors’ recommendation in relation to Resolution 4.

EMU NICKEL NL Notice of General Meeting 11 April 2013

6. RESOLUTIONS 4 TO 6 – APPROVAL FOR THE INCREASE IN VOTING POWER OF BULLANTCO AND MESSRS THOMAS AND STEEMSON AS A RESULT OF THE ISSUE OF CONTRIBUTING SHARES TO BULLANTCO PTY LTD AND ANY CONVERSION OF CONTRIBUTING SHARES

6.1 Background

Resolutions 4 to 6 (inclusive) are necessary in order to comply with specific requirements of the Corporations Act concerning the extent to which Bullantco and each of Bullantco’s Associates, which comprise Messrs Thomas and Steemson, will increase their Voting Power in the Company to above 20%, which is the basic threshold beyond which increases are prohibited by the Corporations Act unless shareholder approval or other exceptional circumstances apply.

The Company has obtained an Independent Expert’s Report from Stantons International Securities to address the fairness and reasonableness of the proposed issue (and conversion) of the Contributing Shares. The Independent Expert’s Report is attached as Annexure A to this Notice. The Independent Expert’s Report prepared by Stantons International Securities has concluded that the placement of Contributing Shares to Bullantco and the subsequent conversion of any Contributing Shares is not fair but reasonable .

A general explanation of what approvals necessary and why is set out below, which is followed by the specific information that the Company is required to provide Shareholders in relation to Resolutions 4 to 6 (inclusive).

6.2 Corporations Act requirements and background

Under section 606(1) of the Corporations Act, a person must not acquire a relevant interest in issued voting shares in a listed company if the person acquiring the interest does so through a transaction in relation to securities entered into by or on behalf of the person and because of the transaction, that person’s or another person’s voting power in the Company increases from:

(a) 20% or below to more than 20%; or
(b) a starting point that is above 20% and below 90%.

Voting Power and Relevant Interests

The voting power of a person in a body corporate is determined by reference to section 610 of the Corporations Act. The calculation of a person’s voting power in a company involves determining the voting shares in the company in which that person and that person’s associates (within the meaning of the Corporations Act) have a relevant interest.

Meaning of “Associate”

Under section 12 of the Corporations Act, a person ( first person ) will be an associate of the other person ( second person ) if:

(a) the first person is a body corporate and the second person is
(i) a body corporate the first person controls;
(ii) a body corporate that controls the first person; or
(iii) a body corporate that is controlled by an entity that controls the first person;
(b) the second person has entered or proposes to enter into a relevant agreement with the first person for the purpose of controlling or influencing the composition of the board or the conduct of the affairs of the Company; or
(c) the second person is a person with whom the first person is acting or proposes to act, in concert in relation to the affairs of the Company.

Associates are determined as a matter of fact. For example where a person controls or influences the board or the conduct of the company’s business affairs or acts in concert with a person in relation to the entity’s business affairs.

Meaning of “Relevant Interest”

Under 608(1) of the Corporations Act a person will have a relevant interest in securities if:

(a) the person is the registered holder of the securities;

EMU NICKEL NL Notice of General Meeting 11 April 2013

(b) the person has the power to exercise, or control the exercise of, a right to vote attached to the securities; or
(c) the person has the power to dispose of, or control the exercise of a power to dispose of, the securities.

It does not matter how remote the relevant interest is or how it arises. If two or more people can jointly exercise one of these powers, each of them is taken to have that power.

Section 608(3) of the Corporations Act provides that a person has a relevant interest in any securities held by a body corporate in which the person’s voting power is above 20%.

Deemed Relevant Interests, Voting Power and Associates

Mr Steemson’s voting power in Bullantco is above 20% by virtue of Mr Steemson holding 23.85%, jointly with his spouse, of the issued share capital in Bullantco. Therefore Mr Steemson is deemed under section 608(3) of the Corporations Act to have the same Relevant Interest in the Company that Bullantco has in the Company.

Given that the board of Bullantco is made by Mr Steemson and Mr Thomas, they jointly have the power to exercise or control the exercise of votes attached to shares held by Bullantco. Therefore Mr Steemson and Mr Thomas are deemed under section 608(1) of the Corporations Act to have the same Relevant Interest in the Company that Bullantco has in the Company.

Messrs Thomas and Steemson are also regarded as Associates of Bullantco under section 12(c) of the Corporations Act, because they are the only directors of Bullantco. Therefore Bullantco is accustomed to act in accordance with the wishes and intentions of Messrs Thomas and Steemson or act in concert with Messrs Thomas and Steemson.

As a result:

(a) In calculating the Voting Power of Mr Steemson, the Relevant Interest of Bullantco must be added to the Relevant Interest that Mr Steemson currently holds through the GH Steemson Family Superannuation Account of which Greg Steemson is one of two trustees and beneficiaries, the other trustee and beneficiary is Mrs Barbara Fay Steemson.
(b) In calculating the Voting Power of Mr Thomas, the Relevant Interest of Bullantco must be added to the Relevant Interest that Mr Thomas currently holds through the Waterford Retirement Plan Account of which Peter Thomas is one of two trustees and beneficiaries, the other trustee and beneficiary is Ms Susan Ann Goodwin and Super Metals Corporation Pty Ltd, Mr Thomas’ private company.

Section 611 item 7 of the Corporations Act – Exemption to Section 606

Section 611 of the Corporations Act provides that certain acquisitions of relevant interests in a company’s voting shares are exempt from the prohibition in section 606(1), including acquisitions approved previously by a resolution passed at a general meeting of the company in which the acquisition is made (section 611 (item 7).

If Bullantco and Bullantco Associates are issued the Contributing Shares pursuant to Resolution 4 without Shareholder approval, or otherwise complying with the permitted exceptions in section 611 of the Corporations Act, the Voting Power of the Bullantco Associates will be in breach of section 606 of the Corporations Act because their respective Voting Power will increase to over 20%.

In addition, if Bullantco and the Bullantco Associates (specifically Messrs Thomas and Steemson) pay up the unpaid amount on their Contributing Shares held by Bullantco and the Bullantco Associates without Shareholder approval or otherwise complying with the permitted exceptions in section 611 of the Corporations Act, the Voting Power of Bullantco and the Bullantco Associates may further increase in breach of section 606 of the Corporations Act.

Consequently Shareholder approval under section 611 item 7 is sought under Resolutions 4 to 6 (inclusive) to authorise the Voting Power of Bullantco and each of Bullantco’s Associates, which comprise Messrs Thomas and Steemson, to increase above 20% following the issue of the Contributing Shares and any conversion of the Contributing Shares into Shares by payment of the unpaid amount on the Contributing Shares held by Bullantco and the Bullantco Associates.

For the exemption in section 611 item 7 to apply, Shareholders must be given all information known to the person proposing to make the acquisition or their associates, or known to the company, that was material to the decision on how to vote on the resolution. ASIC has indicated what additional information should be provided to shareholders in these circumstances.

EMU NICKEL NL Notice of General Meeting 11 April 2013

For the purposes of the Corporations Act and ASIC Regulatory Guide 74 the information in sections 6.3 to 6.5 of the Explanatory Memorandum is disclosed in relation to the acquisition of a relevant interest in the Company by Bullantco and Messrs Thomas and Steemson via Bullantco’s subscription. Shareholders are also referred to the Independent Expert’s Report prepared by Stantons International Securities which forms part of this Explanatory Memorandum. The Independent Expert’s Report concludes that the acquisition is not fair but reasonable to the non-associated Shareholders of the Company.

6.3 Voting Power and Relevant Interests

The figures in the following section assume that:

(a) the Company has a total of 34,643,856 Shares on issue and does not issue any other Shares;
(b) the Company has 19,894,892 Contributing Shares on issue, with $0.03 paid and $0.03 outstanding, which equates to 9,947,446 votes that can be cast in respect of those shares and accordingly, there are 44,591,302 votes attaching to all shares on issue;
(c) no existing options are exercised;
(d) Bullantco subscribes for 14,747,964 Contributing Shares, with $0.03 paid on allotment and $0.03 outstanding, which equates to 7,373,982 votes that can be cast in respect of those shares;
(e) following the issue of Contributing Shares to Bullantco, the Company has a total of 34,643,856 Shares and 34,642,856 Contributing Shares on issue; and
(f) the Company does not make a call for the payment of any of the unpaid amount on the Contributing Shares on issue and no Contributing Shareholders pay up (in whole or in part) the amount remaining unpaid in advance of a call.

Changes in Voting Power and Relevant Interests

Current Voting Power and Relevant Interest

As at the date of this Notice, Bullantco and the Bullantco Associates (Messrs Thomas and Steemson) have the following Relevant Interests and Voting Powers in the Company:

(a) Bullantco will have a Relevant Interest in 802,078 Shares, and a Voting Power of 802,078 Shares, or 1.80% of the total 44,591,302 votes attaching to all Shares on issue.
(b) Mr Thomas will have a Relevant Interest in 5,501,993 Shares (this includes his Relevant Interest in 802,078 Shares held by Bullantco under section 608(1) of the Corporations Act) and 4,699,915 Contributing Shares, and a Voting Power of 7,851,951 Shares, or 17.61% of the total 44,591,302 votes attaching to all Shares on issue.
(c) Mr Steemson will have a Relevant Interest in 5,289,286 Shares (this includes his Relevant in 802,078 Shares held by Bullantco under sections 608(1) and 608(3) of the Corporations Act) and 4,487,208 Contributing Shares, and a Voting Power of 6,730,812 Shares, or 16.89% of the total 44,591,302 votes attaching to all Shares on issue.

The table below summarises each party’s Relevant Interest and Voting Power in the Company at the date of this Notice:

this Notice:
Party	Relevant Interest	Capacity	Voting Power
Bullantco	802,078 Shares	Section 608(1) registered holder	1.80%
Peter Thomas	802,078 Shares 4,699,915 Shares 4,699,915 Contributing Shares	Section 608(1)(b) control Registered or beneficial holder Registered or beneficial holder	17.61%
Greg Steemson	802,078 Shares 4,487,208 Shares 4,487,208 Contributing Shares	Sections 608(1), 608(3) control and 20% interest in Bullantco Registered or beneficial holder Registered or beneficial holder	16.89%

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Voting Power and Relevant Interest following the issue of the Contributing Shares

Following the issue of Contributing Shares to Bullantco under Resolution 4, Bullantco and the Bullantco Associates (Messrs Thomas and Steemson) have the following Relevant Interests and Voting Power in the Company:

(a) Bullantco will have a Relevant Interest in 802,078 Shares and 14,747,964 Contributing Shares, and a Voting Power of 8,176,060 Shares, or 15.73% of the total 51,965,284 votes attaching to all Shares on issue.
(b) Mr Thomas will have a Relevant Interest in 5,501,993 Shares (this includes his Relevant Interest in 802,078 Shares held by Bullantco under section 608(1) of the Corporations Act) and 19,447,879 Contributing Shares (this includes his Relevant Interest in 14,747,964 Contributing Shares held by Bullantco under section 608(1) of the Corporations Act), and a Voting Power of 15,225,933 Shares, or 29.30% of the total 51,965,284 votes attaching to all Shares on issue.
(c) Mr Steemson will have a Relevant Interest in 5,289,286 Shares (this includes his Relevant in 802,078 Shares held by Bullantco under sections 608(1) and 608(3) of the Corporations Act) and 19,235,172 Contributing Shares (this includes his Relevant in 14,747,964 Contributing Shares held by Bullantco under sections 608(1) and 608(3) of the Corporations Act), and a Voting Power of 14,906,872 Shares, or 28.69% of the total 51,965,284 votes attaching to all Shares on issue.

	Current	Current	After the issue of Contributing Shares to Bullantco	After the issue of Contributing Shares to Bullantco
Party	Relevant Interest	Voting Power	Relevant Interest	Voting Power
Bullantco	802,078 Shares	1.80%	802,078 Shares 14,747,964 Contributing Shares	15.73%
Peter Thomas	5,501,993 Shares 4,699,915 Contributing Shares	17.61%	5,501,993 Shares 19,447,879 Contributing Shares	29.30%
Greg Steemson	5,289,286 Shares 4,487,208 Contributing Shares	16.89%	5,289,286 Shares 19,235,172 Contributing Shares	28.69%

Assumptions:

No existing options are exercised.
No Contributing Shares are paid up in whole or part.

Voting Power and Relevant Interest following the issue of the Contributing Shares and payment of the unpaid amounts on the Contributing Shares

Following the issue of Contributing Shares to Bullantco under Resolution 4 and the conversion of Contributing Shares held by Bullantco and the Bullantco Associates (Messrs Thomas and Steemson) by paying the unpaid amount owing on their Contributing Shares, and if no other Contributing Shares are paid up in whole or in part, Bullantco and the Bullantco Associates will have the following Relevant Interests and Voting Power in the Company:

(a) Bullantco will have a Relevant Interest in 15,550,042 Shares and no Contributing Shares, and a Voting Power of 15,550,042 Shares, or 24.32% of the total 63,932,828 votes attaching to all Shares on issue.
(b) Mr Thomas will have a Relevant Interest in 24,949,872 Shares (this includes his Relevant Interest in 15,550,042 Shares held by Bullantco under section 608(1) of the Corporations Act) and no Contributing Shares, and a Voting Power of 24,949,872 Shares, or 39.03% of the total 63,932,828 votes attaching to all Shares on issue.
(c) Mr Steemson will have a Relevant Interest in 24,524,458 Shares (this includes his Relevant in 15,550,042 Shares held by Bullantco under sections 608(1) and 608(3) of the Corporations Act) and no

EMU NICKEL NL Notice of General Meeting 11 April 2013

Contributing Shares, and a Voting Power of 24,524,458 Shares, or 38.36% of the total 63,932,828 votes attaching to all Shares on issue.

The new Shares issued on the conversion of the Contributing Shares will rank equally in all respects with then existing Shares on issue.

The table below sets out the maximum increase in the Voting Power of Bullantco and Messrs Thomas and Steemson

Steemson
	After the issue of Contributing Shares to Bullantco		After the issue of Contributing Shares to Bullantco and payment of unpaid amount on the Contributing Shares
Party	Relevant Interest	Relevant Interest	Relevant Interest	Voting Power
Bullantco	802,078 Shares 14,747,964 Contributing Shares	15.73%	15,550,042 Shares	24.32%
Peter Thomas	5,501,993 Shares 19,447,879 Contributing Shares	29.30%	24,949,872 Shares	39.03%
Greg Steemson	5,289,286 Shares 19,235,172 Contributing Shares	28.69%	24,524,458 Shares	38.36%

Assumptions:

No existing options are exercised.
No Contributing Shares are paid up in whole or in part other than the Contributing Shares held by Bullantco and Messrs Thomas and Steemson or their nominees.

Pro-forma capital structure

The capital structure of the Company following the issue of Contributing Shares to Bullantco is set out below:

	Shares	Unquoted Options	Contributing Shares
Current Capital Structure	34,643,856	923,884	19,894,892
Contributing Shares issued to Bullantco			14,747,964
Securities on issue following the issue to Bullantco	34,643,856	923,884	34,642,856
Securities on issue following (i) the issue of Contributing Shares to Bullantco; and (ii) Bullantco and Messrs Thomas Steemson paying the unpaid amount on their Contributing Shares (their Contributing Shares becoming fully paid Shares)	58,578,943	923,884	10,707,769

6.4 Information required by item 7 of section 611 of the Corporations Act

Resolutions 4 to 6 (inclusive) seek Shareholder approval for the purposes of item 7 of section 611 of the Corporations Act to enable Bullantco to increase its Voting Power from 1.80% to potentially 24.32%, Mr Thomas to increase his Voting Power from 17.61% to potentially 39.03% and to allow Mr Steemson to increase his Voting Power from 16.89% to potentially 38.36%.

Item 7 of section 611 requires the following information to be provided to Shareholders:

EMU NICKEL NL Notice of General Meeting 11 April 2013

(a) The identity of the person proposing to make the acquisition and their associates.

Contributing Shares will be issued to Bullantco and Messrs Thomas and Steemson have a Relevant Interest in the Contributing Shares issued.

(b) The maximum extent of the increase in that person’s Voting Power in the company that would result from the acquisition

Bullantco

Bullantco currently holds 802,078 Shares in the Company and Voting Power of 1.80% and following the issue of Contributing Shares, Bullantco will have a Voting Power of 8,176,060 Shares, or 15.73% of the total votes attaching to Shares on issue. This represents an increase in the Voting Power of Bullantco of 13.93%.

In the event that Bullantco, Peter Thomas and Greg Steemson or their nominees then pay up the unpaid amount on its Contributing Shares, Bullantco will have a Voting Power of 15,550,042 Shares and, if no other Contributing Shares are paid up in whole or in part, or 24.32% of the total votes attaching to all Shares on issue. Accordingly, the maximum extent to which the Voting Power of Bullantco will increase is 22.52%.

Peter Thomas and nominees

Mr Thomas currently holds directly or indirectly 5,501,993 Shares (including his Relevant Interest in 802,078 Shares held by Bullantco) and 4,699,915 Contributing Shares, and a Voting Power of 17.61% of the total votes attaching to Shares on issue. Following the issue of Contributing Shares to Bullantco, Mr Thomas will have a Voting Power of 15,225,932 Shares (including his Relevant Interest in Bullantco’s holdings), or 29.30% of the total votes attaching to Shares on issue. This represents an increase in the Voting Power of Mr Thomas of 11.69%.

In the event that Mr Thomas, Mr Steemson or their nominees and Bullantco then pay up the unpaid amount on his Contributing Shares, Mr Thomas will have a Voting Power of 24,949,372 Shares and, if no other Contributing Shares are paid up in whole or in part, 39.03% of the total votes attaching to all Shares on issue. Accordingly, the maximum extent to which the Voting Power of Mr Thomas will increase is 21.42%.

Greg Steemson and nominees

Mr Steemson currently holds directly or indirectly 5,289,286 Shares (including his Relevant Interest in 802,078 Shares held by Bullantco) and 4,487,208 Contributing Shares, and a Voting Power of 16.89% of the total votes attaching to Shares on issue. Following the issue of Contributing Shares to Bullantco, Mr Steemson will have a Voting Power of 14,906,872 Shares (including his Relevant Interest in Bullantco’s holdings), or 28.69% of the total votes attaching to Shares on issue. This represents an increase in the Voting Power of Mr Steemson of 11.80%.

In the event that Mr Steemson and Mr Thomas or their nominees then pay up the unpaid amount on his Contributing Shares, Mr Steemson will have a Voting Power of 24,524,458 Shares and, if no other Contributing Shares are paid up in whole or in part, 38.36% of the total votes attaching to all Shares on issue. Accordingly, the maximum extent to which the Voting Power of Mr Steemson will increase is 21.47%.

Refer to section 6.3 for a discussion on the changes in Voting Power and Relevant Interests.

(c) The Voting Power that person would have as a result of the acquisition

If the Contributing Shares are issued to Bullantco, the Voting Power of Bullantco will be 15.73%, the Voting Power of Mr Thomas will be 29.30% and the Voting Power of Mr Steemson will be 28.69%, assuming that no Contributing Shares are paid up in whole or in part.

(d) The maximum extent of the increase in the Voting Power of each of that person’s associates that would result from the acquisition

Refer to paragraph (b) above. Other than Bullantco and Messrs Thomas and Steemson (who are associates), there are no other Bullantco associates with a Relevant Interest in the Contributing Shares issued.

EMU NICKEL NL Notice of General Meeting 11 April 2013

(e) The Voting Power that each of that person’s associates would have as a result of the acquisition

Refer to paragraph (c) above. Other than Bullantco and Messrs Thomas and Steemson (who are associates), there are no other Bullantco associates with a Relevant Interest in the Contributing Shares issued.

6.5 Additional Information required by ASIC Regulatory Guide 74

(a) The identity of the allottee and any person who will have a Relevant Interest in the Contributing Shares to be allotted

The Contributing Shares under Resolution 4 will be issued to Bullantco.

Bullantco is a private company incorporated in Western Australia on 28 July 2010.

The directors of Bullantco are Mr Greg Steemson and Mr Peter Thomas.

The number of ordinary fully paid shares on issue in the capital of Bullantco is 48,216,669.

Mr Greg Steemson will have a Relevant Interest in the Contributing Shares by virtue of sections 608(1) and 608(3) of the Corporations Act because Mr Steemson beneficially holds more than 20% of Bullantco and together with Mr Thomas is a director of Bullantco and therefore has the power to exercise or control the exercise of a right to vote attached to the shares held by Bullantco.

Mr Thomas will have a Relevant Interest in the Contributing Shares by virtue of section 608(1) of the Corporations Act.

Refer to the Company’s website (www.emunickel.com.au) for Messrs Steemson and Thomas’ profile.

(b) Full particulars (including the number and percentage) of the shares in the company to which the allottee or purchaser is or will be entitled immediately before and after the proposed acquisition

Refer to section 6.3 of this Explanatory Memorandum for full particulars (including number and percentage) of the Shares in which Bullantco and Messrs Thomas and Steemson have or will have a Relevant Interest immediately before and after the proposed acquisition by Bullantco and the subsequent conversion of the Contributing Shares (by Bullantco and Messrs Thomas and Steemson and no other Contributing Shares are paid up in whole or in part) to Shares.

(c) The identity, associations (with the allottee and with any of its associates), qualifications and commercial experience of any person who is intended to become a director of the Company is shareholders approve the allotment to Bullantco

No change to the composition of the Board is contemplated following the issue of Contributing Shares to Bullantco.

(d) A statement of the allottee’s or purchaser’s intentions regarding the future of the Company if members approve the allotment of Contributing Shares to Bullantco

Bullantco and its Associates currently have no intention to:

change the existing business of the Company as set out in section 1.1 of this Explanatory Memorandum;
inject further capital into the Company;
change the current employment structure of the Company;
transfer any property between the Company and Bullantco and its Associates or any person associated with any of them;
redeploy the fixed assets of the Company.
(e) Any intention of the acquirer to change significantly the financial or dividend policies of the Company

Bullantco and its Associates have no current intention to change the Company’s existing financial or dividend policies.

EMU NICKEL NL Notice of General Meeting 11 April 2013

(f) Particulars of the terms of the proposed allotment of Contributing Shares and any contract or proposed contract between Bullantco and its Associates and the Company or any of their associates which is conditional upon, or directly or indirectly dependent on, Shareholders approving the allotment of Contributing Shares to Bullantco

Other than the subscription summarised under section 5.1 of this Explanatory Memorandum, there are no contracts or proposed contracts between Bullantco and its Associates and the Company or any of their associates which are conditional upon, or directly or indirectly dependent on, Shareholders approving the allotment of Contributing Shares to Bullantco.

(g) When the allotment of Contributing Shares to Bullantco is to be made If Shareholders approve Resolutions 4 to 6 (inclusive), the issue of the Contributing Shares will take place on the business day after the Meeting or so soon thereafter as practicable.

The issue of Shares in consideration for conversion of any Contributing Shares held by Bullantco or its Associates, will depend upon Bullantco or its Associates electing to pay up the unpaid amounts on their Contributing Shares.

(h) An explanation of reasons for the proposed allotment of Contributing Shares to Bullantco

The Contributing Shares are to be allotted to supplement the Company’s general working capital.

(i) The interests of the Directors in Resolutions 4 to 6

Messrs Thomas and Steemson, Directors of the Company, are directors of Bullantco and together hold approximately 43% of the issued share capital in Bullantco.

Mr Gavin Rutherford, who is also a Director of the Company, beneficially holds jointly with his spouse 3,000,000 ordinary fully paid shares in the capital of Bullantco, representing 6.22% of the issued share capital in Bullantco.

Accordingly, Messrs Thomas, Steemson and Rutherford all have an interest in the acquisition of Contributing Shares by Bullantco. However, Mr Rutherford does not consider that he has a ‘material’ personal interest in Bullantco nor the issue of Contributing Shares to Bullantco.

Messrs George Sakalidis and Gavin Rutherford, do not have a material personal interest in the outcome of Resolutions 4, 5 and 6.

(j) Identity of the Directors who approved or voted against the proposal to put Resolutions 4 to 6 to Shareholders

Messrs Sakalidis and Rutherford, the unconflicted Directors, approved the proposal to put Resolutions 4 to 6 to Shareholders.

(k) An analysis of whether the proposed allotment of Contributing Shares to Bullantco, the subject of Resolution 4 and the effect allotment on the Voting Power of Bullantco and Messrs Thomas and Steemson under Resolutions 4, 5 and 6, is fair and reasonable when considered in the context of the interests of non-associated Shareholders

Refer to the Independent Expert’s Report.

6.6 Directors’ Recommendation

The Directors (other than Messrs Thomas and Steemson, being directors of Bullantco) consider that Resolution 4 is in the best interests of the Company and accordingly recommend that Shareholders vote in favour of Resolutions 4 to 6 (inclusive).

Messrs Thomas and Steemson have a material personal interest in the outcome of the Resolutions and decline to make a recommendation in respect of Resolutions 4 to 6.

EMU NICKEL NL Notice of General Meeting 11 April 2013

GLOSSARY

In this Explanatory Memorandum and the Notice, the following terms have the following meanings unless the context otherwise requires:

Acquisition	means the acquisition by the Company of 50% of the entire issued share capital
	of SK pursuant to the Sale Agreement.
Associate	has the meaning ascribed to it in the Corporations Act.
ASX	means ASX Ltd ABN 98 008 624 691 and, where the context requires, the
	Australian Securities Exchange operated by ASX Ltd.
DBCM	means De Beers Consolidated Mining.
DBCM Contract	means the agreement for the supply of Tailings Dump material between KMF
	and DBCM.
Board	means the board of Directors of the Company.
Bullantco	means Bullantco Pty Ltd ACN 145 460 304.
CompanyorEmu	means Emu Nickel NL ACN 127 291 927.
Contributing Shares	means the shares in the capital of the Company partly paid on application as to
	$0.03 with the unpaid amount being $0.03 and on the terms and conditions set
	out in Section 5.4 of this Explanatory Memorandum.
Corporations Act	means Corporations Act 2001 (Cth).
cpht	means carats per hundred tonnes.
Director	means a director of the Company.
Explanatory Memorandum	means this information attached to the Notice, which provides information to
	Shareholders about the Resolutions contained in the Notice.
Independent Expert	means Stantons International Securities.
Independent Expert’s Report	means the Report of the Independent Expert included as Annexure A to this
	Explanatory Memorandum.
KMF	means Kimberley Mining Forum Proprietary Limited.
Listing Rules	means the listing rules of ASX.
Meeting	means this Meeting.
Notice or Notice of Meeting	means the Notice of General Meeting accompanying this Explanatory
	Memorandum.
Mt	means million tonnes.
Proxy Form	means the proxy form attached to this Notice.
Related Party	has the meaning ascribed in the Listing Rules.
Relevant Interest	has the meaning given to it in the Corporations Act.

EMU NICKEL NL Notice of General Meeting 11 April 2013

Resolution	means a resolution contained in the Notice.
Rights Issue	means the Company’s recent rights issue of Contributing Shares contained in a
	prospectus lodged with ASIC on 21 January 2013.
Rosyblue Off-take Agreement	means the agreement between RB and SK which provides RB with the right to
	purchase all of the production from SK’s plant. If RB does not elect to exercise
	its right under the agreement, RB is entitled to be paid a sale commission equal
	5% of the gross sales values realised by SK.
Sale Agreement	means the agreement dated 15 February 2013 between Itakane Trading 243
	Proprietary Limited (the SPV set up by the Company and El Nino to hold the SK
	shares), SK and the Vendors relating to the Acquisition, details of which are set
	out in section 1.3 of the Explanatory Memorandum Notice.
Share	means a fully paid ordinary share in the capital of the Company.
Shareholder	means the holder of a share.
SK	means Superkolong Proprietary Limited.
Vendors	means the shareholders of SK prior to the Acquisition, Rosyblue Manufacturing
	Proprietary Limited (holding 798 shares in the capital of SK (79.8% of the issued
	share capital of SK)) and Dyls Trust (holding 202 shares in the capital of SK
	(20.2% of the issued share capital of SK)).
Voting Power	has the meaning given to it in the Corporations Act.
ZAR	Means South African Rands.

COMPETENT PERSON’S STATEMENT

The details contained in this Notice and Explanatory Memorandum that pertain to exploration results, mineral resources and mineral reserves are based upon information compiled by Mr Greg Steemson, Managing Director of Emu Nickel NL. Mr Steemson is a Fellow of the Australasian Institute of Mining and Metallurgy (FAusIMM) and has sufficient experience in the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” (JORC Code). Mr Steemson consents to the inclusion in the report of the matters based upon his information in the form and context in which it appears.

EMU NICKEL NL Notice of General Meeting 11 April 2013

Annexure A – Independent Expert’s Report

PO Box 1908 West Perth WA 6872 Australia

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Level 2, 1 Walker Avenue West Perth WA 6005 Australia

6 March 2013

The Directors Emu Nickel NL 10 Walker Avenue WEST PERTH WA 6000

Tel: +61 8 9481 3188 Fax: +61 8 9321 1204

ABN: 84 144 581 519 AFS Licence No: 418019 www.stantons.com.au

Dear Sirs

Summary of opinion

In our opinion, taking into account the factors noted elsewhere in this report including the factors (positive, negative and other factors) noted in section 7 of this report, the proposals as outlined in paragraph 1.2 and resolutions 4, 5 and 6 may on balance be considered to be not fair but may be considered reasonable at the date of this report.

Re: EMU NICKEL NL (“EMU” OR “THE COMPANY”) (ABN 50 127 291 927) ON THE PROPOSAL TO ISSUE 14,747,964 PARTLY PAID SHARES TO BULLANTCO PTY LTD (“BULLANTCO”) PAID TO 3 CENTS WITH UNCALLED CAPITAL OF 3 CENTS PER SHARE TO RAISE A GROSS UP TO $442,439 WITH UNCALLED CAPITAL OF $442,439 (3 CENTS PER SHARE) - MEETING OF SHAREHOLDERS PURSUANT TO AUSTRALIAN SECURITIES EXCHANGE LIMITED (“ASX”) LISTING RULE 10.1 AND SECTION 611 (ITEM 7) OF THE CORPORATIONS ACT 2001 (“TCA”)

1. Introduction

1.1 In December 2012, the Company announced a non renounceable Contributing Rights Issue of contributing (partly paid) shares on the basis of 1 contributing share for every 1 fully paid share held and that the contributing share issue price was an initial payment of 3 cents per contributing share and 3 cents uncalled capital (not to be called up within 12 months of issue). As a result of the Contributing Rights Issue that closed in February 2013, the Company raised a total of approximately $596,847 (with uncalled capital of approximately $596,847) and 19,894,892 Contributing Shares issued. The shortfall under the Rights Issue was 14,747,964 Contributing Shares (known as the Shortfall Contributing Shares for the purposes of this report). Bullantco is a company with 18 shareholders, including the interests of Peter Thomas (approximately 19.18%) and Gregory (Greg) Steemson (approximately 23.85%) both of whom are directors of Bullantco and Emu. Bullantco has offered to subscribe for 14,747,964 shares (“Placement Issue Shares”) being equal in number to the Shortfall Contributing Shares (“the Placement Issue”) by paying Emu the sum of approximately $442,439 (3 cents per Placement Issue Shares) with uncalled capital of 3 cents per Placement Issue Shares (uncalled capital approximately $442,439). The terms of subscription by Bullantco are on the same terms of the original Contributing Rights Issue as described above but importantly Bullantco is not offering to take and will not be issued the Shortfall Contributing Shares nor will the Placement Issue Shares be issued under the prospectus in which the Contributing Rights Issue offer was made. Bullantco already owns 802,078 fully paid shares in Emu representing an approximate 2.32% interest in the fully paid shares on issue and an approximate 1.80% voting interest taking into account the 19,894,892 Contributing Shares on issue. The interests of Peter Thomas have a shareholding interest in 4,699,915 fully paid shares (approximately 13.57% of the fully paid shares on issue in Emu) and 4,699,915 Contributing Shares in Emu (approximately 23.62% of the Contributing Shares on issue in Emu). The overall relevant voting interest in Emu by the interests of Peter Thomas approximates 15.81% - the Contributing Shares have 50% of one vote based on the 50% paid up on the Contributing Shares) and including the holding of Bullantco in Emu, the overall relevant voting interests of Peter Thomas approximate 17.61% (section 6.3 of the Explanatory Memorandum attached to the Notice of Meeting provides further details). The interests of Greg Steemson have a relevant interest in

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Liability limited by a scheme approved under Professional Standards Legislation

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4,487,208 fully paid shares (approximately 12.95% of the fully paid shares on issue in Emu) and 4,487,208 Contributing Shares in Emu (approximately 22.55% of the Contributing Shares on issue in Emu). The overall relevant voting interest in Emu by the interests of Greg Steemson approximates 15.09% and including the holding of Bullantco in Emu, the overall relevant voting interests of Greg Steemson approximate 16.89%. Section 6.3 of the Explanatory Memorandum to Shareholders (‘EM”) attached to the Notice of Meeting (‘Notice”) provides further details.

1.2 As noted above, the interests of Peter Thomas owns approximately 13.57% of the fully paid shares on issue in Emu and has a relevant voting interest in Emu of approximately 15.81% excluding the shares in Bullantco (approximately 17.61% including the 802,078 shares held by Bullantco). The overall relevant voting interest in Emu by the interests of Greg Steemson approximates 15.09% excluding the shares in Bullantco (approximately 16.89% including the 802,078 shares held by Bullantco). As the directors of Bullantco are Peter Thomas and Greg Steemson and they are also directors of Emu and substantial shareholders in both Emu and Bullantco, both Peter Thomas and Greg Steemson are deemed associated (related) to Bullantco (but Peter Thomas and Greg Steemson are not associated with each other) and are deemed related parties under the ASX Listing Rule 10.1 and Part 2 E of TCA. We have been advised that the interests of Peter Thomas own 9,250,000 shares in Bullantco representing an approximate 19.18% shareholding interest in Bullantco. The interests of Greg Steemson own 11,500,000 shares in Bullantco, representing an approximate 23.85% shareholding interest in Bullantco. Furthermore if Bullantco subscribes for the Placement Issue Shares, Bullantco’s voting shareholding interest in Emu increases from approximately 1.80% (of the fully paid shares and Contributing Shares on issue) to approximately 15.73%. The combined voting interests of Peter Thomas and Bullantco post the issue of 14,747,964 Placement Issue Shares to Bullantco would approximate 29.30%. The combined voting interests of Greg Steemson and Bullantco post the issue of 14,747,964 Placement Issue Shares to Bullantco would approximate 28.69%. The combined voting interests of Peter Thomas, Greg Steemson and Bullantco post the issue of 14,747,964 Placement Issue Shares to Bullantco would approximate 42.25% although as noted above, Peter Thomas and Greg Steemson are not associated with each other. In the event that all Contributing Shares on issue (including the Placement Issue Shares) were paid up in full after 12 months (the Company would receive cash funds of approximately $1,039,286), Bullantco’s shareholding interest (and voting interest) would approximate 22.44%, the interests of Peter Thomas shareholding and voting interest would approximate 13.57% and the combined Bullantco and Peter Thomas shareholding and voting interest would approximate 36.01%. Greg Steemson shareholding and voting interest would approximate 12.95% and the combined Bullantco and Greg Steemson shareholding and voting interest would approximate 35.40%. The combined Bullantco, Peter Thomas and Greg Steemson shareholding and voting interest would approximate 48.96% (but it is noted that Peter Thomas and Greg Steemson are nor deemed associated with each other). Further details on the relevant interests of Bullantco, Peter Thomas and Greg Steemeson are outlined in Section 6.3 of the EM.

Pursuant to ASX Listing Rule 10.1 a company is required to obtain shareholder approval prior to entering into a transaction with a person in a position of influence.

1.3 Under Section 606 of TCA, a person must not acquire a relevant interest in issued voting shares in a company if because of the transaction, that persons or someone else's voting power in the company increases:
(a) from 20% or below to more than 20%; or (b) from a starting point that is above 20% and below 90%.

Under Section 611 (Item 7) of TCA, Section 606 does not apply in relation to any acquisition of shares in a company approved by resolution passed at a general meeting at which no votes were cast in favour of the resolution by the acquirer or the disposer or their respective associates. An independent expert is required to report on the fairness and reasonableness of the transaction pursuant to a Section 611 (Item 7) meeting.

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As noted above, the relevant interests of Bullantco and Peter Thomas, Bullantco and Greg Steemson and Bullantco and Peter Thomas and Greg Steemson combined, indicate that the percentage voting interest in Emu may exceed 20% after the issue of the Placement Issue Shares to Bullantco and after all Contributing Shares (includes the Placement Issue Shares) are fully paid up.

1.4 Therefore a notice prepared in relation to a meeting of shareholders convened for the purpose of ASX Listing Rule 10.1 and Section 611 (Item 7) of TCA must be accompanied by an Independent Expert's Report stating whether the proposal to allow Bullantco, Peter Thomas and Greg Steemson to increase their relevant interests in Emu (via Bullantco subscribing for up to 14,747,964 Placement Issue Shares that are to be issued as noted under resolution 4 to Bullantco) is fair and reasonable. Resolution 4 refers to the approval to allow Bullantco to increase its voting power in Emu as a result of the issue of the Placement Issue Shares and the subsequent conversion of the Placement Issue Shares into new fully paid ordinary shares. Resolution 5 refers to the approval to allow Peter Thomas to increase his voting power in Emu as a result of issuing 14,947,964 Placement Issue Shares to Bullantco and the subsequent conversion of the Placement Issue Shares held by Bullantco and the Contributing Shares held by Peter Thomas or his nominees into new fully paid ordinary shares in Emu. Resolution 6 refers to the approval to allow Greg Steemson to increase his voting power in Emu as a result of issuing 14,947,964 Placement Issue Shares to Bullantco and the subsequent conversion of the Placement Issue Shares held by Bullantco and the Contributing Shares held by Greg Steemson or his nominees into new fully paid ordinary shares. To assist shareholders in making decisions on the proposals pursuant to resolutions 4, 5 and 6, the directors have requested that Stantons International Securities prepare an Independent Expert's Report, which must state whether, in the opinion of the Independent Expert, the proposal as outlined in resolutions 4, 5 and 6 are fair and reasonable to the shareholders of Emu not associated with Bullantco, Peter Thomas and Greg Steemson. In order for us to conclude on the proposals pursuant to resolutions 4, 5 and 6 we have had to comment on the fairness and reasonableness of the issue of the up to 14,747,964 Placement Issue Shares as noted in resolution 4 and any conversion of the Placement Issue Shares and the Contributing Shares on issue.
1.5 Apart from this introduction, this report considers the following:
Summary of opinion
Implications of the proposals
Corporate history and nature of business of Emu
Future direction of Emu
Basis of valuation of Emu Shares
Premium for control
Fairness and Reasonableness of the proposal pursuant to resolutions 4, 5 and 6
Conclusion as to the fairness and reasonableness of the Placement Issue
Sources of information
Appendix A and Financial Services Guide
1.6 In determining the fairness and reasonableness of the issue of Placement Issue Shares to Bullantco and the fairness and reasonableness of the proposals under resolutions 4, 5 and 6, we have had regard for the definitions set out by the Australian Securities and Investments Commission (“ASIC”) in its Regulatory Guide 111, “Content of Expert Reports”. Regulatory Guide 111 states that an opinion as to whether an offer is fair and/or reasonable shall entail a comparison between the offer price and the value that may be attributed to the securities under offer (fairness) and an examination to determine whether there is justification for the offer price on objective grounds after reference to that value (reasonableness). The concept of “fairness” is taken to be the value of the offer price, or the consideration, being equal to or greater than the value of the securities in the above mentioned offer. Furthermore, this comparison should be made assuming 100% ownership of the “target” and irrespective of whether the consideration is scrip or cash. An offer is “reasonable” if it is fair. An offer may also be reasonable, if despite not being ”fair”, there are sufficient grounds for security holders to accept the offer in the absence of any higher bid before the close of the offer. The concept of “fairness” is taken to be the value of the offer price, or the consideration, being equal to or greater than the value of the securities in

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the above mentioned offer. It also states that, where an acquisition of shares by way of an allotment is to be approved by shareholders pursuant to section 611 (Item 7) of TCA, it is desirable to commission a report by an independent expert stating whether or not the proposal is fair and reasonable, having regards to the proposed allottees and whether a premium for potential control is being paid by the allottees. Regulatory Guide 111 also provides that such an allotment should involve a comparison of the advantages and disadvantages likely to accrue to non associated shareholders if the transactions proceed compared with if they do not.

Accordingly, our report relating to the receipt of cash and issue of Placement Issue Shares to Bullantco and any conversion of the Placement Issue Shares (and in particular the proposals pursuant to resolutions 4, 5 and 6) is concerned with the fairness and reasonableness of the proposal with respect to the existing non-associated shareholders of Emu (not associated with Bullantco, Peter Thomas and Greg Steemson).

1.7 In our opinion, taking into account the factors noted elsewhere in this report including the factors (positive, negative and other factors) noted in section 7 of this report, the proposals as outlined in paragraph 1.2 and resolutions 4, 5 and 6 may on balance be considered to be not fair but may be considered reasonable at the date of this report.

Notwithstanding that the Emu share price last traded on ASX at 7.5 cents on 6 March 2013 is greater than the proposed Placement Issue price of 3.0 cents (with uncalled capital of 3 cents per Placement Issue Share for a potential total issue price of 6 cents), each shareholder needs to examine the market conditions at the time of exercise of vote to ascertain the impact, if any, on resolutions 4, 5 and 6.

We are not reporting on the merits or otherwise of any other resolutions outlined in the Notice and EM. However, we have considered the implications of Emu acquiring a 50% interest in a South African company that in turn has a 30.4% shareholding interest in another South African company that operates a small diamond processing operation that would be effective 1 March 2013. Further details are noted below and in the EM attached to the Notice. In fact, the acquisition of SK has proceeded but shareholders are being asked to ratify the acquisition via resolution 2 in the Notice.

2. Implications of the Proposal

2.1 As at 1 March 2013, there were 34,643,856 ordinary fully paid shares on issue in Emu and 19,894,892 Contributing Shares on issue paid to 3 cents each with uncalled capital of 3 cents per Contributing Share. The significant fully paid shareholders as at 15 February 2013 date based on the top 20 shareholders list (the same shareholders may hold further shares in Umu that do not appear in the top 20 shareholder list) were believed to be:

GH & BF Steemson Peter Sisley Thomas (see below) F & JI King Wallace George Sakalidis (refer below)	No. of fully paid shares % of issued fully paid shares 4,487,208 12.95 4,355,135 12.57 1,919,287 5.54 1,562,811 4.51
	12,324,441 35.57

The top 20 shareholders at 15 February 2013 owned approximately 75.17% of the ordinary fully paid issued capital of the Company. As noted above, the total beneficial fully paid shareholding of Peter Thomas approximates 13.57% as there are four other shareholding interests associated with Peter Thomas to take his combined relevant interest in the fully paid shares to 4,699,915. Bullantco has a fully paid shareholding interest in Emu of 802,078 shares, representing an approximate 2.32% interest in the fully paid shares on issue. George Sakalidis also is associated with a further 569,335 fully paid shares so his total fully paid shareholding is 2,132,166.

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As noted above, the interests of Peter Thomas and Greg Steemson own approximately 23.62% and 22.55% respectively of the 19,894,892 Contributing Shares on issue.

In the event that 14,747,964 Placement Issue Shares are issued to Bullantco, the voting shareholding interest in Emu by Bullantco will increase from approximately 1.80% to approximately 15.73%. Emu will receive an initial approximate $442,439 with uncalled commitment to Emu of approximately $442,439 payable not less than 12 months from the issue date of the original Contributing Shares. The shareholding and potential voting interests of Bullantco, Peter Thomas and Greg Steemson and combinations thereto are outlined in paragraph 1.2 above.

2.2 The current Board of Directors of Emu is not expected to change in the near future as a result of the issue of the Placement Contributing Shares. The current shareholders are Peter Thomas, Greg Steemson, George Sakalidis (Managing Director) and Gavin Rutherford.
2.3 The Company has acquired a 50% interest in a South African company that in turn has a 30.4% shareholding interest in another South African company that operates a small diamond processing operation that would be effective 1 March 2013. Shareholders pursuant to resolution 2 are being asked to ratify such acquisition. Further details are noted below.
2.4 The Company as at 1 March 2013, 841,148 share options outstanding exercisable at $0.5874 each, on or before 22 December 2014 and 82,736 share options outstanding exercisable at $0.4266 each, on or before 21 December 2014.

3. Corporate History and Nature of Business

Emu

3.1 Emu is listed on the ASX. Its focus is mineral exploration in Australia but its major asset presently is its cash at bank and on deposit. Its current mineral areas of interest are:
Emu Lakes (30.3%) – nickel exploration project 70km NE of Kalgoorlie. Joint venture with Image Resources and Xstrata Nickel Australasia. The Joint Venture partners plan to reduce the tenement holdings shortly, surrender some tenements and seek expressions of interest for the project.
Salmon Gums (100%) – gold prospect
Ward Springs (90%) – base metal prospect and some drilling planned for 2013
3.2 On 20 February 2013, the Company announced that it had entered into a conditional agreement with EL Nino Mining Proprietary Limited (“El Nino”), a subsidiary of Balta Minerals SA, an entity listed on the NYSE Euronet to acquire (via a special purpose limited liability company – “SPV” called Itakane Trading 243 Proprietary Limited (“Itakane”)) to purchase, inter-alia, all of the issued capital of Superkolong Proprietary Limited (“SK”) and all of the Claims against SK. SK is a 30.4% shareholder in the South African company, Kimberley Miners Forum Proprietary Limited (“KMF”). KMF has purchased various coarse diamondiferous, kimberlite tailing dumps (Tailings Mineral Resources – “TMR’s”) situated around the town of Kimberley in South Africa. SK operates a diamond tailings processing and recovery plant leased by SK from DBCM adjacent to the largest TMR resource purchased by KMF known as Chrono 1. The terms of the acquisition by SPV are, inter-alia:
Purchase price payable by SPV to the SK Vendors is the amount of ZAR 135,000,000 (possibly between the equivalent of $14,000,000 to $16,875,000 depending on the AUS/ZAR exchange rates) (50% by Emu and 50% by El Nino) payable in 4 instalments due as to ZAR 40,000,000 on 1 March 2013 (includes ZAR 5,000,000 relating to the SPV acquiring all of the rights and obligations of a off-take agreement), ZAR 25,000,000 on 1 September 2013, ZAR 35,000,000 on 1 March 2014 and ZAR 35,000,000 on 1 September 2014. Section 1.3 of the EM refers to further details.

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The effective recourse of the SK Vendors to recover and the security for the Purchase Price is limited to the shares held by SPV and a portion of the cash flows of SK which are to be held in escrow.

Based on current operational parameters, funding for the payments due on 1 September 2013, 1 March 2014 and 1 September 2014 to the SK Vendors will be met from the SK cash flow. Under the arrangements with KMF, TMR material is delivered to each shareholder of KMF in their respective KMF equity proportions and treated by each KMF shareholder in their own plants. SK and the other two shareholders of KMF have been operating plants to process the TMR’s via KMF since 2007. The KMF agreement with DBCM allows KMF’s shareholders (including in particular, SK), access to the TMR’s until February 2018. The SK plant currently processes SK’s attributable proportion of the TMR’S comprising of up to 150,000 tpm of TMR tailings and recovers up to 15,000 carats of diamonds per month. The transactions between SPV and the SK Vendors are subject to a number of regulatory approvals, including approvals by the Board of Directors and shareholders of the SK Vendors and the SPV, South African Take Over Regulation Panel, South African Revenue Services tax clearance in respect of SK and the Financial Surveillance Department of the South African Reserve Bank (permitting the SPV to receive loan funding from the Company). The effective date for the transaction is 1 March 2013.

The Claims against SK as noted above include inter-alia loan accounts owing to the SK Vendors estimated to total ZAR 23,450,000. It is noted that there are other claims against SK that the existing shareholders of SK are disputing and are thus treated as contingent liabilities. These contingent liabilities amount to ZAR 6,332,300 plus statutory interest and legal costs, however if the contingent liabilities become real liabilities, the monies payable to the litigants by SK can be offset from the Purchase Price payable by the SPV. In the meantime, the SK Vendors will fund litigation costs. Until such time as the Purchase Price has been paid in full, the SK Vendors shall be entitles to retain one current SK director on the SK Board.

It is proposed that Emu Blue Pty Ltd (a wholly owned subsidiary of Emu will lend ZAR 20,850,000 (approximately $2,278,700 but could be higher or lower) to SPV (Itakane) so SPV can use such funds to meet its objectives of pursuing new investment opportunities in South Africa (as well as investing in SK). The loan by the Emu Group will be repayable between 2 and 4 years and bear interest.

4. Future Directions of Emu

We have been advised by the directors and management of Emu that:

There are no proposals currently contemplated either whereby Emu will sell any properties or assets to Bullantco or where Emu would acquire assets from Bullantco;
• The composition of the Board will not change in the short term as noted above;
The Company is to seek to raise further working capital and that it may issue up to 14,747,964 Placement Issue Shares at an initial 3 cents per share to raise $442,439 and have uncalled capital commitment of a further 3 cents per Placement Issue Share ($442,439) payable not less than 12 months from the issue date of the original Contributing Shares. The issue of any Placement Issue Shares to Bullantco is subject to Emu shareholders approval under resolutions 4, 5 and 6. In the event that cash flows are insufficient from the proposed diamond project (refer paragraph 3.2 above), the Company may be required to seek new capital to meet Purchase Price staged commitments;
The Board intends to distribute to shareholders all funds surplus (if any and for so long as such surplus be significant to the Company’s investment and operating requirements) (as determined by the Board) subject always to availability of distributable profits (if any); solvency requirements; banking or other funding covenants by which the Company is bound from time to time; and acquisitive and organic growth opportunities;
The Company will endeavour to enhance the value of its interests in its existing mineral assets and subject to the acquisition of SK, enhance the value of the diamond projects in South Africa (refer paragraph 3.2 above).

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5. Basis of Valuation of Emu

5.1 In considering the proposals as outlined in resolutions 5 and 6 (and resolution 4) we have sought to determine whether the issue price of the Placement Issue Shares to Bullantco is in excess of the current fair value of the shares in Emu on issue and whether the proposed Placement Issue is at a price that Emu could make to unrelated third parties and then conclude whether the proposal is fair and reasonable to the existing non associated shareholders of Emu.
5.2 The valuation methodologies we have considered in determining a theoretical value of an Emu share are:
Capitalised maintainable earnings/discounted cash flow;
Takeover bid - the price at which an alternative acquirer might be willing to offer;
Adjusted net asset backing and windup value; and
The recent market prices of Emu shares.

5.3 Capitalised maintainable earnings and discounted cash flows.

Due to Emu’s current operations, a lack of profit history arising from business undertakings and the lack of a reliable future cash flow from a current business activity, we have considered these methods of valuation not to be relevant for the purpose of this report. The exploration and potential development of any projects cannot proceed without further expenditure on exploration and evaluation and ultimately further funds for capital and working capital expenditure. However, following the SK acquisition, the Company in the medium term may produce positive cash flows based on preliminary projections provided to us by Emu management and the share price may rise from current prices (to 6 March 2013). At this point of time, it is premature to value the Company on a maintainable earnings or discounted cash flow basis, but we note that the technical value of an Emu share may be in excess of the share price as at 26 February 2013.

5.4 Takeover Bid

It is possible that a potential bidder for Emu could purchase all or part of the existing shares, however no certainty can be attached to this occurrence. To our knowledge, there are no current bids in the market place and the directors of Emu and ourselves have formed the view that there is unlikely to be any takeover bids made for Emu in the immediate future. Refer paragraph 1.2 above refers to potential “control” by Bullantco in conjunction with Peter Thomas and Greg Steemson.

5.5 Adjusted Net Asset Backing

5.5.1 We set out below an unaudited consolidated Balance Sheet of Emu as at 31 December 2012 after allowing an estimated $350,000 for administration and exploration costs to be incurred in between January 2013 and March 2013 and allowing for the receipt of $596,847 from the issue of the Contributing Shares.

Current Assets Cash Receivables Other assets Non Current Assets Fixed assets Capitalised exploration costs Investments	Emu (as adjusted) 31 December 2012 $000’s 3,339 43 9
	3,391
	2 87
	89

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Total Assets Current Liabilities Trade and other payables Total Current Liabilities Total liabilities Net Assets Equity Issued capital Reserves Accumulated losses Net Equity	Emu (as adjusted) 31 December 2012 $000’s
	3,480
	131
	131
	131
	3,349
	9,913 125 (6,689)
	3,349

5.5.2 The unaudited adjusted book net tangible asset backing as at 31 December 2012 equates to approximately 9.66 cents per fully paid ordinary share based on 34,643,856 fully paid ordinary shares on issue. Taking into account the 19,894,892 partly paid shares and allowing for 50% voting rights attributable to the Contributing Shares results in a value per voting share of approximately 7.51 cents (approximately 6.14 cents ignoring voting rights). Assuming the issue of the 14,747,964 Placement Issue Shares at an initial 3 cents per share to raise a gross $442,439 (and excluding the uncalled capital), the net asset backing would rise to approximately $3,791,000 for a net asset backing per voting share (deemed to be 51,964,284) of approximately 7.2 cents. On a fully diluted basis (all 34,643,856 contributing shares fully paid up) (but ignoring the outstanding share options), the number of fully paid shares on issue would be 69,286,712 and assuming the receipt of $1,039,286 from the calling up of all unpaid capital but ignoring losses or profits post 31 December 2012, the net assets may approximate $4,388,000 for a net asset backing per share of approximately 6.33 cents. The EM attached to the Notice refers to a further pro-forma statement of financial position assuming the acquisition of SK. We make no comment on the accuracy or otherwise of such pro-forma statement of financial position

5.5.3 We have accepted the book amounts of Emu’s current assets and non-current assets. We have been assured by the management of Emu that they believe the carrying value of all current assets and liabilities at 31 December 2012 (as adjusted) are fair and not materially misstated. An external technical valuation of the mineral assets of Emu (in the books at nil) has not been undertaken as it is considered more appropriate (for the purpose of considering the fairness and reasonableness of the proposed issue of the Placement Issue Shares to Bullantco) to consider the market value of the Emu shares. However it is noted that the up to 14,747,964 Placement Issue Shares are being issued to Bullantco on the same terms as the Contributing Shares issued under the Contributing Rights Issue.
5.5.3 We note that the market has been informed of all of the current projects, joint ventures and farm in/farm out arrangements entered into between Emu and other parties. We also note it is not the present intention of the Directors of Emu to liquidate the Company and therefore any theoretical value based upon wind up value or even net book value (as adjusted), is just that, theoretical. The shareholders, existing and future, must acquire shares in Emu based on the market perceptions of what the market considers an Emu share to be worth. The market has either generally valued the vast majority of junior/mid size mineral exploration and development companies at significant discounts or premiums to appraised technical values and this has been the case for a number of years although we also note that there is an orderly market for Emu shares and the market is kept fully informed of the activities of the Company. The market has ascribed a current value as noted below.

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5.6 Market Price of Emu Fully Paid Ordinary Shares
5.6.1 We set out below a summary of the fully paid share prices of Emu since September 2012.

	High Cents	Low Cents	Last Sale Cents	Volume Trade (000’s)
September 2012	7.8	7.0	7.2	87
October 2012	7.5	6.5	6.6	159
November 2012	7.0	6.5	6.7	224
December 2012	7.4	7.0	7.4	265
January2013	7.6	7.4	7.6	2,348
February2013	8.0	7.3	8.0	284
March(to 6th)	8.0	7.5	7.5	109

The volume of trades in Emu shares is quite low and the share price can be affected by relatively small volumes. However, Emu is a listed entity and it would be remiss not to refer to the share prices in evaluating the fairness of the proposed issue price of the Placement Issue Shares of 3 cents each that is planned with Bullantco. It is noted that the adjusted book net asset backing per voting share as at 31 December 2012 approximates 7.51 cents. On 23 January 2013, 2,094,464 shares were traded on the date the Company despatched the Contributing Rights Issue Prospectus to shareholders.

5.6.2 Generally, the market is a fair indicator of what a share is worth, however the theoretical technical value based on the underlying value of assets and liabilities may be lower or higher. Arguably, the market value of an Emu share lies mainly in the range of 7.0 cents to 7.5 cents that is close to the net asset backing per voting share. The Company is cashed up but following the SK acquisition, Emu has now outlaid an initial ZAR 20,850,000 (approximately $2,278,700), being 50% of the initial deposit of ZAR 40,000,000 along with ZAR 850,000 as a deposit on high frequency screens. As noted the Contributing Rights Issue was undertaken at 3 cents each with uncalled capital of 3 cents each and not callable until at least 12 months after the issue date of the Contributing Shares when the share price of an Emu share was in the range of 7.0 cents to 7.4 cents (to date of issue of the original Prospectus was on 23 January 2013 following the announcement of the Contributing Rights Issue on 28 December 2012).

We note that the terms of the Placement Issue Shares are on the same terms as the Contributing Rights Issue terms (being an upfront payment of 3 cents per share with uncalled capital of 3 cents per share and no call to be made before 12 months of issue of the Contributing Shares being issued) except that the no call will be made within 12 months of the issue of the original Contributing Shares that is now deemed to be not before 19 January 2014.

5.7 The future value of an Emu share will depend upon, inter alia:
The successful exploitation of the current mineral assets of Emu and if SK is acquired the diamond tailings project in South Africa;
The state of the gold, diamond and base metal markets (and prices) in Australia and overseas;
The cash position of the Emu;
The state of Australian and overseas stock markets;
Foreign exchange rates;
Membership and control of the Board and composition and quality of management;
General economic conditions; and
• Liquidity of shares in Emu.

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6. PREMIUM FOR CONTROL

6.1 Premium for control for the purposes of this report, has been defined as the difference between the price per share, which a buyer would be prepared to pay to obtain or improve a controlling interest in the Company and the price per share which the same person would be required to pay per share, which does not carry with it control or the ability to improve (increase) control of the Company.
6.2 Under TCA, control may be deemed to occur when a shareholder or group of associated shareholders control more than 20% of the issued capital. As noted above, Bullantco’s voting shareholding interest in Emu in conjunction with Peter Thomas and/or Greg Steemson would increase from approximately 2.32% to approximately 42.25% if Bullantco subscribed for the 14,747,964 Placement Issue Shares as envisaged under resolution 4. In conjunction with Peter Thomas only, the combined voting interest of Bullantco and Peter Thomas would approximate 29.30%. In conjunction with Greg Steemson only, the combined voting interest of Bullantco and Greg Steemson would approximate 28.69%. On a fully diluted basis, the voting interest of Bullantco may approximate 22.44% (and approximately 48.96% when combined with Peter Thomas and Greg Steemson although we recognise that Peter Thomas and Greg Steemson are not deemed associated with each other). Accordingly, we have addressed whether a premium for potential control will be paid.
6.3 The December 2012 to 26 February 2012 share market prices of an Emu share lay in the range of approximately 7.0 cent to 8.0 cents. As Bullantco may acquire up to 14,747,964 Placement Issue Shares at an upfront issue price of 3.0 cents each and a commitment to pay a call of 3 cents per share not less than 12 months as noted above, it could be argued that on balance Bullantco is probably paying not paying a premium for potential control based on share prices in Emu shares over the past 8 weeks (and is also not paying a premium for potential control based on adjusted net book asset backing per share).

7 Conclusion as to the fairness and reasonableness of the proposal under resolutions 4, 5 and 6

7.1 We set out below some of the advantages and disadvantages and other factors pertaining to the proposed Placement Issue of up to 14,747,964 Placement Issue Shares to Bullantco and the subsequent conversion of the Placement issue Shares pursuant to resolution 4 of the Notice and the proposals pursuant to resolutions 5 and 6.

Advantages

7.2 Notwithstanding the cash position of the Company (refer paragraph 5.5.1 above) by entering into the proposal with the Bullantco, the short term cash position is improved that will allow Emu to obtain new working capital and continue with the on-going exploration of its mineral projects and provide further funds to assist in meeting 50% of the first tranche of the Purchase Price of acquiring SK as noted above. In addition, the Emu Group is to loan SPV the sum of ZAR 20,850,000 (around $2,278,700 but may be more or less depending on exchange rates at the time). The Placement Issue price is on the same terms and conditions as the Contributing Rights Issue as announced to the market on 28 December 2012 and thus Bullantco is not obtaining a share price advantage as compared with those fully paid shareholders who did not take up their non renounceable entitlement under the Contributing Rights Issue.
7.3 There is a continuing incentive for Bullantco to ensure Emu becomes a viable mineral exploration and development company as Bullantco (and Peter Thomas and Greg Steemson) will continue to have significant interests in Emu. Bullantco is taking a risk in investing further funds into Emu as to a large extent, Emu’s future share price may be determined by the exploitation and/or commercial success (or otherwise) of its exploration portfolio that is not large (and if the SK acquisition proceeds on commercial success of the diamond tailings project). There is a huge incentive for Bullantco (and Peter Thomas and Greg Steemson) to make Emu a successful company and have the share price rise considerably. All shareholders would benefit from a rise in the share price.

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7.4 No brokerage costs are being paid for the total Placement Issue of 14,747,964 Placement Issue Shares. It is normal for brokerage fees to be approximately between 4% and up to 7.5% of the cash raised. This is some saving to the Company.

Disadvantages

7.5 The number of partly paid ordinary shares on issue initially rises by 14,747,964 to 34,642,856. This represents an approximate 74.12% increase in the ordinary contributing shares of the Company. However if the initial Contributing Rights Issue had issued all shares available under the Contributing Rights Issue, the number of contributing shares would have increased to 34,642,856.
7.6 An increased influential shareholding of the Company is being given to Bullantco in that it would immediately have voting control of approximately 15.73% of the expanded voting ordinary issued capital after the successful ratification and implementation of resolutions 4 to 6 (and approximately 42.25% in conjunction with the voting power of both Peter Thomas and Greg Steemson). On a fully diluted basis (all uncalled capital paid up but ignoring share options), Bullantco’s voting shareholding would approximate 22.44% (and approximately 48.96% in conjunction with Peter Thomas and Greg Steemson). The December 2012 to 26 February 2012 share market prices of an Emu share lay in the range of approximately 7.0 cent to 8.0 cents. As Bullantco may acquire up to 14,747,964 Placement Issue Shares at an upfront issue price of 3.0 cents each and a commitment to pay a call of 3 cents per share not less than 12 months as noted above, it could be argued that on balance Bullantco is probably not paying a premium for potential control based on share prices in Emu shares over the past 8 weeks (and is also not paying a premium for potential control based on adjusted net book asset backing per share). Thus, technically, Peter Thomas and Greg Steemson are not paying premiums for control.

Other Factors

7.7 The issue price of the Placement Issue Shares is at a discount to Emu market prices achieved in January 2013 to 26 February 2013 that is not unreasonable but is being undertaken at the same price (3.0 cents per Placement Issue Share with uncalled capital of 3 cents per share) as the recent Contributing Rights Issue as noted above. The raising of cash for junior exploration companies over the past few years has been extremely difficult and discounts of between 20% and 50% (or more) are not uncommon. The raising of a further $442,439 (with the possibility of a further $442,439 after a minimum of 12 months) is of value to the Company.
7.8 The proposed issue price (initial payment and the uncalled amount) under the Placement Issue is below the net asset backing per share value of approximately 7.51 cents.
7.9 The amount raised from the Placement Issue initially is only $442,439 yet Bullantco increases its voting power from approximately 1.80% to approximately 15.73%.
7.10 In the event that preliminary projections of cash flows as prepared by Emu management in relation to SK are achieved, the potential share price of an Emu share may be higher than the February 2013/early March 2013 share prices of an Emu share and the overall 6 cents (3 cents up front and 3 cents on the call being made) per Placement Issue Share price.
Conclusion as to fairness and reasonableness
8.1 In our opinion, taking into account the factors noted elsewhere in this report including the factors (positive, negative and other factors) noted in section 7 of this report, the proposals as outlined in paragraph 1.2 and resolutions 4, 5 and 6 may on balance be considered to be not fair but may be considered reasonable at the date of this report.

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9. Sources of Information

9.1 In making our assessment as to whether the proposals under resolutions 4, 5 and 6 as noted in paragraph 1.1 is fair and reasonable, we have reviewed relevant published available information and other unpublished information of the Company that is relevant to the current circumstances. In addition, we have held discussions with the management of Emu about the present and future operations of the Company. Statements and opinions contained in this report are given in good faith but in the preparation of this report, we have relied in part on information provided by the directors and management of Emu.

9.2 Information we have received includes, but is not limited to:

Draft Notice’s of Emu and draft Explanatory Statements to Shareholders prepared in February 2013;
Discussions with management and directors of Emu;
Details of historical market trading of Emu’s ordinary fully paid shares recorded by ASX
for the period 1 July 2012 to 6 March 2013;
Shareholding details of EMU (fully paid and Contributing Shareholding) and Bullantco as supplied by the each companies share registry as at 15 February 2013;
Un-audited balance sheet of Emu as at 31 December 2012;
Announcements made by Emu to the ASX from January 2012 to 6 March 2013;
The cash flow projections of Emu for 2013;
Numerous agreements relating to the acquisition by the SPV of all of the issue capital of SK (Shareholders Agreement, Loan Agreement, Sale of Shares and Claims Agreement, Cessation and Assignment Agreement and an Escrow Agreement);
Preliminary cash flow projections relating to the diamond Kimberley tailings in South
Africa as it relates to SK for 6 years; and
Schedule of shareholdings and voting powers of Bullantco, Peter Thomas and Greg Steemson pre and post the Placement Issue.

9.3 Our report includes Appendix A and our Financial Services Guide attached to this report.

Yours faithfully STANTONS INTERNATIONAL AUDIT AND CONSULTING PTY LTD (Trading as Stantons International Securities)

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J P Van Dieren - FCA Director

APPENDIX A

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AUTHOR INDEPENDENCE AND INDEMNITY

This annexure forms part of and should be read in conjunction with the report of Stantons International Securities dated 6 March 2013, relating to the proposals outlined in resolutions 4, 5 and 6 (only) in the Notice of Meeting to Shareholders to be distributed to shareholders in March 2013.

At the date of this report, Stantons International Securities does not have any interest in the outcome of the proposal. There are no relationships with Emu or Bullantco other than acting as an independent expert for the purposes of this report. There are no existing relationships between Stantons International Securities and the parties participating in the transaction detailed in this report which would affect our ability to provide an independent opinion. The fee to be received for the preparation of this report is based on the time spent at normal professional rates plus out of pocket expenses and is estimated not to exceed $15,000. The fee is payable regardless of the outcome. With the exception of the fee, neither Stantons International Securities nor John P Van Dieren have received, nor will, or may they receive, any pecuniary or other benefits, whether directly or indirectly, for or in connection with the making of this report.

Stantons International Securities does not hold any securities in Emu or Bullantco. There are no pecuniary or other interests of Stantons International Securities that could be reasonably argued as affecting its ability to give an unbiased and independent opinion in relation to the proposal. Stantons International Securities and Mr J Van Dieren have consented to the inclusion of this report in the form and context in which it is included as an annexure to the Notice.

QUALIFICATIONS

We advise Stantons International Securities is the holder of an Investment Advisers Licence (No 418019) under the Corporations Act relating to advice and reporting on mergers, takeovers and acquisitions involving securities. A number of the directors of Stantons International Audit and Consulting Pty Ltd are the directors and authorised representatives of Stantons International Securities. Stantons International Securities and Stantons International Audit and Consulting Pty Ltd (also trading as Stantons International) have extensive experience in providing advice pertaining to mergers, acquisitions and strategic and financial planning for both listed and unlisted companies and businesses.

Mr John P Van Dieren, FCA, the person responsible for the preparation of this report, has extensive experience in the preparation of valuations for companies and in advising corporations on takeovers generally and in particular on the valuation and financial aspects thereof, including the fairness and reasonableness of the consideration offered.

The professionals employed in the research, analysis and evaluation leading to the formulation of opinions contained in this report, have qualifications and experience appropriate to the task they have performed.

DECLARATION

This report has been prepared at the request of the directors of Emu in order to assist the shareholders of Emu to assess the merits or otherwise of the proposals as outlined in resolutions 4, 5 and 6 and the EM to which this report relates. This report has been prepared for the benefit of Emu’s shareholders and does not provide a general expression of Stantons International Securities opinion as to the longer term value of Emu, its assets, its subsidiaries and the mineral assets to be acquired if the SK acquisition proceeds. Stantons International Securities does not imply, and it should not be construed, that is has carried out any form of audit on the accounting or other records of Emu. Neither the whole nor any part of this report, nor any reference thereto may be included in or with or attached to any document, circular, resolution, letter or statement, without the prior written consent of Stantons International Securities to the form and context in which it appears.

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DISCLAIMER

This report has been prepared by Stantons International Securities with due care and diligence. However, except for those responsibilities which, by law cannot be excluded, no responsibility arising in any way whatsoever for errors or omission (including responsibility to any person for negligence) is assumed by Stantons International Securities (Stantons International Audit and Consulting Pty Ltd), their directors, employees or consultants for the preparation of this report.

DECLARATION AND INDEMNITY

Recognising that Stantons International Securities may rely on information provided by Emu, its officers and other parties (save whether it would not be reasonable to rely on the information having regard to Stantons International Securities experience and qualifications), Emu has agreed:

(a) to make no claim by it or its officers against Stantons International Securities (and Stantons International Audit and Consulting Pty Ltd) to recover any loss or damage which Emu may suffer as a result of reasonable reliance by Stantons International Securities on the information provided by Emu and the other parties; and
(b) to indemnify Stantons International Securities (and Stantons International Audit and Consulting Pty Ltd) against any claim arising (wholly or in part) from Emu or any of its officers providing Stantons International Securities any false or misleading information or in the failure of Emu and its officers in providing material information, except where the claim has arisen as a result of wilful misconduct or negligence by Stantons International Securities.

A draft of this report was presented to the Directors of Emu for a review of factual information contained in the report. Comments received relating to factual matters were taken into account, however the valuation methodologies and conclusions did not alter.

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FINANCIAL SERVICES GUIDE FOR STANTONS INTERNATIONAL AUDIT AND CONSULTING PTY LTD (Trading as Stantons International Securities) Dated 6 March 2013

Stantons International Securities (ABN 84 144 581 519 and AFSL Licence No 418019) (“SIS” or “we” or “us” or “ours” as appropriate) has been engaged to issue general financial product advice in the form of a report to be provided to you.

2. Financial Services Guide

In the above circumstances we are required to issue to you, as a retail client a Financial Services Guide (“FSG”). This FSG is designed to help retail clients make a decision as to their use of the general financial product advice and to ensure that we comply with our obligations as financial services licensees.

This FSG includes information about:

who we are and how we can be contacted;
the services we are authorised to provide under our Australian Financial Services Licence, Licence No: 418019;
remuneration that we and/or our staff and any associated entities receive in connection with the general financial product advice;
any relevant associations or relationships we have; and
our complaints handling procedures and how you may access them.

3. Financial services we are licensed to provide

We hold an Australian Financial Services Licence which authorises us to provide financial product advice in relation to:

Securities (such as shares, options and notes)

We provide financial product advice by virtue of an engagement to issue a report in connection with a financial product of another person. Our report will include a description of the circumstances of our engagement and identify the person who has engaged us. You will not have engaged us directly but will be provided with a copy of the report as a retail client because of your connection to the matters in respect of which we have been engaged to report.

Any report we provide is provided on our own behalf as a financial services licensee authorised to provide the financial product advice contained in the report.

4. General Financial Product Advice

In our report we provide general financial product advice, not personal financial product advice, because it has been prepared without taking into account your personal objectives, financial situation or needs. You should consider the appropriateness of this general advice having regard to your own objectives, financial situation and needs before you act on the advice. Where the advice relates to the acquisition or possible acquisition of a financial product, you should also obtain a product disclosure statement relating to the product and consider that statement before making any decision about whether to acquire the product.

5. Benefits that we may receive

We charge fees for providing reports. These fees will be agreed with, and paid by, the person who engages us to provide the report. Fees will be agreed on either a fixed fee or time cost basis.

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Except for the fees referred to above, neither SIS, nor any of its directors, employees or related entities, receive any pecuniary benefit or other benefit, directly or indirectly, for or in connection with the provision of the report.

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All our employees receive a salary. Our employees are eligible for bonuses based on overall productivity but not directly in connection with any engagement for the provision of a report.

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We do not pay commissions or provide any other benefits to any person for referring customers to us in connection with the reports that we are licensed to provide.

8. Associations and relationships

SIS is ultimately a wholly owned division of Stantons International Audit and Consulting Pty Ltd a professional advisory and accounting practice. From time to time, SIS and Stantons International Audit and Consulting Pty Ltd (also trading as Stantons International) and/or their related entities may provide professional services, including audit, accounting and financial advisory services, to financial product issuers in the ordinary course of its business.

9. Complaints Resolution

9.1 Internal complaints Resolution process

As the holder of an Australian Financial Services Licence, we are required to have a system for handling complaints from persons to whom we provide financial product advice. All complaints must be in writing, addressed to:

The Complaints Officer Stantons International Securities Level 2 1 Walker Avenue WEST PERTH WA 6005

Telephone: 08 9481 3188 Facsimile: 09 9321 1204

When we receive a written complaint we will record the complaint, acknowledge receipt of the complaints within 15 days and investigate the issues raised. As soon as practical, and not more than 45 days after receiving the written complaint, we will advise the complainant in writing of our determination.

9.2 Referral to External Dispute Resolution Scheme

A complainant not satisfied with the outcome of the above process, or our determination, has the right to refer the matter to the Financial Ombudsman Service Limited (“FOSL”). FOSL is an independent company that has been established to provide free advice and assistance to consumers to help in resolving complaints relating to the financial services industry.

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Further details about FOSL are available at the FOSL website www.fos.org.au or by contacting them directly via the details set out below.

Financial Ombudsman Service Limited PO Box 3 MELBOURNE VIC 8007

Toll Free: 1300 78 08 08 Facsimile: (03) 9613 6399

THIS DOCUMENT IS IMPORTANT. IF YOU ARE IN DOUBT AS TO HOW TO DEAL WITH IT, PLEASE CONTACT YOUR STOCK BROKER OR LICENSED PROFESSIONAL ADVISOR.

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PROXY FORM

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EMU NICKEL NL

REGISTERED OFFICE:

ABN: 50 127 291 927

GROUND FLOOR 20 KINGS PARK ROAD WEST PERTH WA 6005

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SHARE REGISTRY: Security Transfer Registrars Pty Ltd All Correspondence to: PO BOX 535, APPLECROSS WA 6953 AUSTRALIA 770 Canning Highway, APPLECROSS WA 6153 AUSTRALIA T: +61 8 9315 2333 F: +61 8 9315 2233 E: [email protected] W: www.securitytransfer.com.au

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Code: EMU

Holder Number:

SECTION A: Appointment of Proxy

I/We, the above named, being registered holders of the Company and entitled to attend and vote hereby appoint:

OR

The meeting Chairperson The name of the person you are appointing (mark with an "X") (if this person is someone other than the Chairperson of the meeting).

or failing the person named, or if no person is named, the Chairperson of the Meeting, as my/our Proxy to act generally at the meeting 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) at the General Meeting of the Company to be held at 2.00pm (WST) on Thursday 11 April 2013 at 10 Walker Avenue, West Perth, Western Australia 6005 and at any adjournment of that meeting.

SECTION B: Voting Directions to your Proxy

Please mark "X" in the box to indicate your voting directions to your Proxy.

Resolution

For Against Abstain*

Change to nature and scale of activities
Ratification of the Acquisition of Superkolong Proprietary Limited
Change of Company Name
Approval of placement of Contributing Shares to a Related Party
Approval for the increase in Voting Power of Mr Peter Thomas
Approval for the increase in Voting Power of Mr Greg Steemson

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If no directions are given my proxy may vote as the proxy thinks fit or may abstain.

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 votes will not be counted in computing the required majority on a poll.

If you wish to appoint the Chairperson as your proxy and you do not wish to direct the Chairperson how to vote, please mark "X" in the box.

By marking this box, you acknowledge that the Chairperson may exercise your proxy even if he has an interest in the outcome of the resolution and votes cast by him/her other than as a proxy holder will 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 will not cast your votes on the resolution and your votes will not be counted in calculating the required majority if a poll is called on the resolution. The Chairperson of the Meeting intends to vote undirected proxies in favour of the resolution.

SECTION C: Please Sign Below

This section must be signed in accordance with the instructions overleaf to enable your directions to be implemented.

Individual or Security Holder Security Holder 2 Security Holder 3 Sole Director and Sole Company Secretary Director Director / Company Secretary

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Reference Number:

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1421423782

EMU

My/Our contact details in case of enquiries are: NAME

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TELEPHONE NUMBER ( )

NOTES

1. Name and Address

This is the name and address on the Share Register of EMU NICKEL NL. If this information is incorrect, please make corrections on this form. Shareholders sponsored by a broker should advise their broker of any changes. Please note that you cannot change ownership of your shares using this form.

2. Appointment of a Proxy

If you wish to appoint the Chairperson of the Meeting as your Proxy please mark "X" in the box in Section A. Please also refer to Section B of this proxy form and ensure you mark the box in that section if you wish to appoint the Chairperson as your Proxy.

If the person you wish to appoint as your Proxy is someone other than the Chairperson of the Meeting please write the name of that person in Section A. If you leave this section blank, or your named Proxy does not attend the meeting, the Chairperson of the Meeting will be your Proxy. A Proxy need not be a Shareholder of EMU NICKEL NL.

3. Directing your Proxy how to vote

To direct the Proxy how to vote place an "X" in the appropriate box against each item in Section B. Where more than one Proxy is to be appointed and the proxies are to vote differently, then two separate forms must be used to indicate voting intentions.

4. Appointment of a Second Proxy

You are entitled to appoint up to two (2) persons as proxies to attend the meeting and vote on a poll. If you wish to appoint a second Proxy, an additional Proxy form may be obtained by telephoning the Company's share registry +61 8 9315 2333 or you may photocopy this form.

To appoint a second Proxy you must:

(a) On each of the Proxy forms, state the percentage of your voting rights or 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 of your votes; and
(b) Return both forms in the same envelope.

5. Signing Instructions Individual: where the holding is in one name, the Shareholder must sign.

Joint Holding: where the holding is in more than one name, all of the Shareholders must sign.

Power of Attorney: to sign under Power of Attorney you must have already lodged this document with the Company's share registry. If you have not previously lodged this document for notation, please attach a certified photocopy of the Power of Attorney to this form when you return it.

Companies: where the Company has a Sole Director who is also the Sole Company Secretary, this form must be signed by that person. If the Company (pursuant to section 204A of the Corporations Act 2001) does not have a Company Secretary, a Sole Director may sign alone. Otherwise this form must be signed by a Director jointly with either another Director or Company Secretary. Please indicate the office held in the appropriate place.

If a representative of the corporation is to attend the meeting the appropriate "Certificate of Appointment of Corporate Representative" should be lodged with the Company before the meeting or at the registration desk on the day of the meeting. A form of the certificate may be obtained from the Company's share registry.

6. Lodgement of Proxy

Proxy forms (and any Power of Attorney under which it is signed) must be received by Security Transfer Registrars Pty Ltd no later than 2.00pm (WST) on Tuesday 9 April 2013, being 48 hours before the time for holding the meeting. Any Proxy form received after that time will not be valid for the scheduled meeting.

Security Transfer Registrars Pty Ltd PO BOX 535 Applecross, Western Australia 6953

Street Address: Alexandrea House, Suite 1 770 Canning Highway Applecross, Western Australia 6153

Telephone +61 8 9315 2333 Facsimile +61 8 9315 2233 Email [email protected]

PRIVACY STATEMENT

Personal information is collected on this form by Security Transfer Registrars Pty Ltd as the registrar for securities issuers for the purpose of maintaining registers of securityholders, facilitating distribution payments and other corporate actions and communications. Your personal details may be disclosed to related bodies corporate, to external service providers such as mail and print providers, or as otherwise required or permitted by law. If you would like details of your personal information held by Security Transfer Registrars Pty Ltd or you would like to correct information that is inaccurate please contact them on the address on this form.

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4365423782

AI assistant

EMU NL — Proxy Solicitation & Information Statement 2013

64851_rns_2013-03-07_a2237255-444b-43a7-8dab-cc986c4b4f1c.pdf

EMU NICKEL NL ACN 127 291 927

NOTICE OF GENERAL MEETING EXPLANATORY MEMORANDUM

AND

EMU NICKEL NL ACN 127 291 927 NOTICE OF GENERAL MEETING

Resolution 1 – Change to nature and scale of activities

Resolution 2 – Ratification of the Acquisition of Superkolong Proprietary Limited

Resolution 3 – Change of Company Name

Resolution 4 – Approval of placement of Contributing Shares to a Related Party

Resolution 5 – Approval for the increase in Voting Power of Mr Peter Thomas

Resolution 6 – Approval for the increase in Voting Power of Mr Greg Steemson

Explanatory Memorandum

Proxy Form

PROXIES

ENTITLEMENT TO VOTE

CORPORATIONS

EXPLANATORY MEMORANDUM

1. OVERVIEW

1.1 Background to the Acquisition

1.2 Acquisition of Superkolong Proprietary Limited

1.4 Overview of SK

(a) Background

(b) Tailings Dump Material

1.5 Effect of the Acquisition on the Company

(b) Effect on the Company’s Share Capital

(c) Effect on the Company’s Exploration Expenditure on its existing tenements

(d) Effect on the Company’s Financial Position and Future Potential Earnings

EMU NICKEL NL

1.6 Pro-forma Statement of Financial Position

Emu Nickel NL Statement of Financial Position 31 December 2012

1.7 Advantages of the Acquisition

1.8 Disadvantages

1.9 Risk Factors

(a) Currency Risk

(b) Government Actions and Political Risk

(c) Labour Risk

(d) Operational Risks

(e) Counterparty and contractual risk

(f) Reliance on DBCM Contact

(g) Volatility of commodity prices

(h) Litigation

2. RESOLUTION 1 – CHANGE IN NATURE AND SCALE OF ACTIVITIES

2.1 General

2.2 Directors’ Recommendation

The Directors unanimously recommend that Shareholders vote in favour of Resolution 1.

3. RESOLUTION 2 – RATIFICATION OF THE ACQUISITION OF SUPERKOLONG PROPRIETARY LIMITED

3.1 Directors’ Recommendation

The Directors unanimously recommend that Shareholders vote in favour of Resolution 2.

4. RESOLUTION 3 – CHANGE OF COMPANY NAME

4.1 Directors’ Recommendation

5. RESOLUTION 4 – APPROVAL OF PLACEMENT OF CONTRIBUTING SHARES TO A RELATED PARTY

5.1 Subscription

5.2 Overview of Bullantco and its Associates

Operations and Investments

Directors

Shareholders

5.3 Listing Rule 10.11 Requirements

5.4 Terms and Conditions of the Contributing Shares

EMU NICKEL NL

Notice of General Meeting 11 April 2013

EMU NICKEL NL

5.5 Chapter 2E of the Corporations Act

5.6 Section 611 item 7 of the Corporations Act

5.7 Directors’ Recommendation

6.1 Background

6.2 Corporations Act requirements and background

Voting Power and Relevant Interests

Meaning of “Associate”

Meaning of “Relevant Interest”

Deemed Relevant Interests, Voting Power and Associates

Section 611 item 7 of the Corporations Act – Exemption to Section 606

6.3 Voting Power and Relevant Interests

Changes in Voting Power and Relevant Interests

Voting Power and Relevant Interest following the issue of the Contributing Shares

Assumptions:

Pro-forma capital structure

6.4 Information required by item 7 of section 611 of the Corporations Act

Bullantco

EMU NL Proxy Solicitation & Information Statement 2013