Immuron Ltd — Capital/Financing Update 2013

Feb 17, 2013

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ABN: 80 063 114 045 Level 1 18 Kavanagh Street Southbank, Vic 3006 Tel: +61 3 8648 4530 Fax: +61 3 9686 9460 www.immuron.com

18 February 2013

The Manager The Company Announcement Office Australian Stock Exchange Sydney NSW 2000

Dear Sir Drawdown on Funding Facility with Paladin Labs Inc.

Attached are the following documents in respect of the above drawdown.

1. Announcement of the drawdown of $CAD500,000 under the Secured Convertible Debenture with Paladin Labs Inc.

2. Cleansing notice prepared in accordance with ASIC class order 10-322, and

3. Appendix 3B in respect of the potential shares that could be issued under the terms of the convertible debenture.

Yours faithfully

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Graeme Stevens Company Secretary

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IMMURON DRAWS DOWN ON SECOND TRANCHE OF FUNDING FACILITY WITH PALADIN LABS

Melbourne, Australia, 18 February 2013 : Immuron Limited (ASX: IMC) announces that it has drawn down $CA 0.5 million, being the second tranche of the debenture agreement that facilitates a funding arrangement under which Paladin will have provided a total of $CA 1.5 million to Immuron.

This follows an initial drawdown of $CAD1.0 million that was announced on 16 January 2012. The term of the Debenture include a coupon rate of 10% and will not be due for repayment until three (3) years from the date of the initial drawdown, being 13 January 2015.

This second debenture includes provision for Paladin Labs Inc. to elect to convert at any time prior to the repayment date at a conversion price of AU$0.0473. Further the amount of $CA 0.5 million to be drawn down under the second debenture includes provision that it will automatically convert into fully paid ordinary shares of the Company where the Company subsequently raises at least an additional AU$1.5M within an agreed time frame. The price under an automatic conversion is the lower of (i) AU$0.0473 and (ii) the issue price per fully paid ordinary share at which Immuron subsequently raises capital; and otherwise on the same terms as those issued under any such subsequent capital raise. Immuron currently has no other capital raising commitments at this time.

The further funding under the Paladin second debenture will be used by Immuron for working capital and to continue expansion of its territories for Travelan. Immuron believes that the drawdown of the Paladin second debenture places it in a stronger position with respect to any further capital it seeks for the continued commercialization of Travelan and the further progress of its pipeline products.

Additional details of the Paladin debenture is contained in the attached cleansing notice prepared in compliance with ASIC class order 10‐322.

Contact

Joe Baini – Chief Executive Officer +61 3 8648 4530

About Immuron Limited

Immuron is a biopharmaceutical company focused on oral immunotherapy treatments using dairy‐ derived antibody products for humans. Immuron is uniquely positioned with a versatile technology platform capable of generating a wide range of products with a high safety profile. This high safety profile makes it possible to complete pre‐clinical studies relatively quickly and increases the prospect that the clinical development of Immuron’s products will be expedited. Immuron’s current products and product candidates target infectious diseases of the gastrointestinal tract, chronic diseases such as fatty liver (NASH), and the prevention of influenza. Immuron has one product in the market, Travelan, for preventing travellers’ diarrhoea.

Immuron’s main scientific alliances are with Hadassah Medical Center (Israel), the University of Melbourne and Monash University (Australia).

About Travelan

Travelan prevents travellers’ diarrhoea (TD). It is a natural product derived from Australian dairy cows that is up to 90% effective. Travelan®, made from Immuron’s bovine colostrum technology, substantially reduces the risk of developing TD, an illness afflicting up to six‐in‐10 travellers to high risk destinations. The caplets, which contain milk proteins derived from the colostrum of Australian dairy cows, neutralise the Escherichia coli bacteria – the leading cause of TD – before the onset of symptoms. In a randomized, controlled clinical trial published in the peer‐reviewed Scandinavian Journal of Gastroenterology in July, Australian and Polish researchers established the 90 per cent efficacy finding and that the Travelan oral formulation contains antibodies that significantly reduce the risk of diarrhoea and helps reduce the symptoms of minor gastrointestinal conditions.

About Paladin Labs Inc.

Paladin Labs Inc., headquartered in Montreal, Canada, is a specialty pharmaceutical company focused on acquiring or in‐licensing innovative pharmaceutical products for the Canadian and world markets. With this strategy, a focused national sales team and proven marketing expertise, Paladin has evolved into one of Canada's leading specialty pharmaceutical companies. Paladin's shares trade on the Toronto Stock Exchange under the symbol PLB. For more information about Paladin, please visit the Company's web site at www.paladinlabs.com.

Notice issued under section 708A (12C) (e) of the Corporations Act 2001 (Cth) 18 February 2013

On 29 November 2011, Immuron Limited ACN 063 114 045 ( Immuron ) announced that it had on 28 November 2011 entered into a convertible debenture subscription agreement ( Subscription Agreement ) with Paladin Labs, Inc. ( Paladin ). Paladin is not a related party of Immuron. An initial debenture was issued to Paladin for CAD$1,000,000 on 13 January 2012 ( Initial Debenture ).

Pursuant to the terms of the Subscription Agreement, Immuron has today issued to Paladin a further secured convertible debenture ( Debenture ), with a face value of CAD$500,000. The Debenture was issued without disclosure to investors under Part 6D.2 of the Corporations Act 2001 (Cth) ( Act ).

Immuron issues this notice under section 708A (12C) (e) of the Act (as inserted by ASIC Class Order CO [10/322] On-sale for Debenture issued to wholesale investors ) ( Class Order ) to enable the Immuron shares ( Immuron Shares ) issued on the conversion of the Debenture to be on-sold to retail investors without further disclosure ( Cleansing Notice ).

1. Contents of this Cleansing Notice

This Cleansing Notice sets out the following information:

• (a) in relation to the Debenture:

• (i) the effect that the issue of the Debenture and the issue of the Immuron Shares on the conversion of Debenture has on Immuron; and

• (ii) a summary of the rights and liabilities attaching to the Debenture and the Immuron Shares;

• (b) information that:

• (i) has been excluded from a continuous disclosure notice in accordance with the ASX Listing Rules ( Listing Rules ); and

• (ii) investors and their professional advisors would reasonably require for the purpose of making an informed assessment of:

  • (A) the assets and liabilities, financial position and performance, profits and losses and prospects of Immuron; and

  • (B) the rights and liabilities attached to the Debenture and the Immuron Shares; and

• (c) other additional information including content relating to Immuron’s status as a disclosing entity which is required under the Class Order.

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2. Offer of the Debenture

2.1

No Offer

No offer or invitation is made pursuant to this Cleansing Notice for any person to subscribe for or apply to acquire any Debenture or Immuron Shares.

2.2 Summary of the Subscription Agreement

The Debenture has been issued pursuant to the terms the Subscription Agreement (as varied by the parties). Details of the key terms of the Debenture are set out below.

(a) Purpose

Immuron will use the funds raised upon the issue of the Debenture to pursue its general corporate purposes in connection with its business, including working capital needs.

(b) Payment of the subscription price

Paladin will pay a subscription price of CAD$500,000 for the Debenture upon the issue of the Debenture.

(c) Other obligations

The Subscription Agreement also imposes certain restrictions on Immuron on the conduct of its business. Immuron is also required to provide various undertakings and representations under the Subscription Agreement which are standard in debenture subscription agreements of this nature.

3. Debenture

3.1 Effect of the issue of Debenture on Immuron

The issue of the Debenture will result in an increase in:

• (a) the cash held by Immuron by the amount of approximately AU$482,000 before costs (assuming an approximate CAD/AUD exchange rate of 0.9638 which is the Bank of Canada noon rate on 15 February 2013); and

• (b) the indebtedness of Immuron to Paladin increasing by approximately AU$482,000 plus interest (described below) (assuming an approximate CAD/AUD exchange rate of 0.9638 which is the Bank of Canada noon rate on 15 February 2013).

3.2

Rights and liabilities of the Debenture

The key terms of the Debenture are set out below.

Terms	Details
Issuer	Immuron Limited (ASX: IMC).
Principal Amount	Immuron issued the Debenture on 18 February 2013 at a subscription price of CAD$500,000 (Principal Amount).
Maturity Date	13 January 2015

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Terms	Details
Voluntary Prepayment before Maturity Date	Immuron may, at its discretion, prepay amounts outstanding under the Debenture in whole or in part on any Business Day being at least 15 months after the date of the Debenture (i.e. on any date that is after 18 May 2014) before the Maturity Date, by paying to Paladin an amount equal to 120% of the Principal Amount being repaid. Immuron's above right to repay is subject to the right of Paladin to elect to convert the Principal Amount into Immuron Shares instead.
Prepayment on Asset Sale	If Immuron sells any of its assets for consideration in excess of AU$50,000 (net of certain expenses and taxes and outside the ordinary course of its business) before the Maturity Date, it must apply 75% of the net sale proceeds as a prepayment in reduction of the Principal Amount. The payment shall be applied at the rate equal to 120% of the Principal Amount being repaid. Immuron's obligation to repay is subject to the right of Paladin to elect to convert the Principal Amount into Immuron Shares instead.
Redemption on Change of Control	Upon a change of control of Immuron, Immuron (or the controlling entity) shall offer, within 5 Business Days, to redeem all of the Principal Amount then outstanding at a redemption price equal to 120% of the outstanding Principal Amount together with any accrued but unpaid interest. Immuron's obligation to redeem is subject to the right of Paladin to elect to convert the Principal Amount into Immuron Shares instead.
Repayment on Maturity Date	If the Debenture has not been prepaid, redeemed or converted prior to the Maturity Date, Immuron must redeem the Debenture on the Maturity Date by paying to Paladin an amount equal to the Principal Amount.
Interest Rate	Interest is payable on the Principal Amount at the annual rate of 10% (Applicable Rate) accruing daily and compounding annually. Interest is payable in cash calendar monthly, unless Paladin elects to receive the interest in the form of Immuron Shares in lieu of cash.
Security	The Debenture will be secured by a registered security interest created under a Specific Security Deed (SSD). The SSD creates a security interest in favour of Paladin over certain assets of Immuron, all of which excludes its intellectual property.
Events of Default	The following are Events of Default: (a) failure by Immuron in payment of the Principal Amount or Interest when due and does not remedy the default within 5 Business Days; (b) Immuron defaults under the SSD, the charge registered with respect to the Initial Debenture or the Subscription Agreement and does not remedy the default within 14 days; (c) Immuron incurs debt senior to the Debenture (other than the charge registered with respect to the Initial Debenture and certain permitted indebtedness) without prior Paladin consent; (d) Immuron defaults under any other form of document for money borrowed which causes or permits an acceleration of

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Terms

Details

indebtedness in an aggregate principal amount of at least AU$50,000 (e) A change in control of Immuron occurs and Immuron does not give due notice or fails to pay the redemption price to Paladin (f) A representation or warranty by Immuron is found to be incorrect or misleading and Immuron does not remedy the default within 14 days (g) failure by Immuron to perform any other term in a material respect under the Subscription Agreement, the Debenture, the SSD or other transaction documents and the default is not remedied within 14 days; and (h) Judgment for payment in excess of AU$50,000, or for seizure or foreclosure, is rendered against Immuron and not discharged within 10 Business Days, or action by a judgment creditor is not dismissed within 90 days. (i) Immuron: (i) applies for or consents to the appointment of a receiver, trustee, liquidator or custodian of itself or all or a substantial part of its property, (ii) is unable, or admits it is unable, to pay its debts as they mature; (iii) makes a general assignment for the benefit of its creditors (iv) is wound-up dissolved or liquidated; (v) becomes insolvent; (vi) commences a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or its debts under any bankruptcy, insolvency or other similar law or consent to any such relief or to the appointment of or taking possession of its property by any official in an involuntary case or other proceeding commenced against it; (vii) takes any action for the purpose of effecting any of the foregoing; (j) Proceedings for the appointment of a receiver, trustee, liquidator or custodian of the Corporation or of all or a substantial part of the property thereof, or an involuntary case or other proceeding seeking liquidation, reorganization or other relief with respect to the Corporation or the debts thereof under any bankruptcy, insolvency or similar law are commenced and an order for relief entered. Upon the occurrence of certain of the Events of Default, Paladin's rights include (i) declaring all outstanding obligations to be immediately due and payable, or (ii) declare that the Applicable Rate be increased to 14% until such time as the Event of Default has been cured; or (iii) Paladin may exercise any other right, power or remedy granted to it by the Transaction Documents or otherwise permitted to it bylaw.Uponthe occurrence ofan Event of Defaultforchange of

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Terms	Details
	control (para (e) above), voluntary bankruptcy or insolvency proceedings (para (i) above) or involuntary bankruptcy or insolvency proceedings (para (j) above), all outstanding obligations payable by Immuron automatically become immediately due and payable.
Paladin Optional Conversion	Paladin may at any time prior to the Maturity Date convert all or part of the Principal Amount into Immuron Shares at a conversion price equal to the Canadian dollar equivalent, at the Bank of Canada noon rate on the day of conversion, of AU$0.0473.
Automatic Conversion (Events)	Upon receipt of notice that one of the following has occurred, the outstanding Principal Amount shall be converted: (a) the occurrence of ten consecutive ASX trading days (Calculation Period) during which both of (i) and (ii) following occur, provided that the 7-day volume weighted average trading price of fully paid ordinary shares in the capital of Immuron (Ordinary Shares) on ASX is no less than the applicable conversion price on the date Paladin receives that notice: (i) the number of issued Ordinary Shares multiplied by the volume weighted average trading price of the Ordinary Shares on the ASX during each such day is equal to or greater than a certain amount and (ii) the average daily trading volume of Ordinary Shares for Calculation Period being equal to or greater than the average daily trading volume of Ordinary Shares for the 12 months preceding the Calculation Period, or (b) Immuron issuing Ordinary Shares (and, at the discretion of Immuron, options to acquire Ordinary Shares) after the date of the Debenture and on or before 30 June 2013 to raise capital (in aggregate) of at least a specified amount, and subject to the that capital raising have a specified minimum issue price for the Ordinary Shares (2013 Fund Raising), (each an “Automatic Conversion Event”) At this time of issue of this notice, Immuron has no commitments or decision in respect of any possible 2013 Fund Raising.
Conversion Price on Automatic Conversion	Subject to the provisions affording Paladin certain anti-dilution rights, Conversion Prices are: (a) For Automatic Conversion Event (a) above, the Canadian dollar equivalent, at the Bank of Canada noon rate on the day of conversion, of AU$0.0473; or (b) For Automatic Conversion Event (b) above, the lower of: (i) the Canadian dollar equivalent, at the Bank of Canada noon rate on the day of conversion, of AU$0.0473, and (ii) the price per Ordinary Share at which the 2013 Fund Raising is completed, provided that where the 2013FundRaisingincludes any accompanying options

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Terms	Details
	to acquire Ordinary Shares, on conversion (but without reducing the Conversion Price), Paladin will also be issued options on the same terms as those issued under the 2013 Fund Raising (if any) (in which case Paladin will need to subscribe for those options under the terms of a prospectus to be lodged with ASIC by Immuron in connection with that offer). At the date of this notice, Immuron has made no decision whether or not to proceed with any 2013 Fund Raising, and, if so, whether any 2013 Fund Raising will involve the issue of options and (if relevant) the terms of any such options.
Anti–Dilution Adjustments	The conversion price and the number and type of securities to issue upon conversion are subject to adjustment respect to any occurrence of the following events (all of which exclude the 2013 Fund Raising): (a) Dividend, subdivision, combination or re- classification of ordinary shares (b) Certain distributions (including cash and securities) (c) Capital re-organisations (d) certain other transactions
Governing Law	The Debenture will be governed by the laws of the state of Victoria, Australia
ASX Listing	The Debenture will not be quoted on the ASX or any other securities exchange. Under the Subscription Agreement, Immuron is required to apply to ASX for quotation of any new Immuron Shares issued on the conversion of the Debenture as soon as practicable, and in any event within the time required under the ASX Listing Rules. Immuron must also apply to ASX for quotation of any new options issued to Paladin on conversion of the Debenture.
**Transferability **	The Debenture is not transferable by either party without the written consent of the other (unless by Paladin to one of its affiliates).

3.3 Effect on Capital Structure Effect on capital structure

The capital structure of Immuron will be affected by any conversion of the Debenture which will result in additional Immuron Shares being issued. At that time, Immuron’s debt position will decrease accordingly.

Subject to the anti-dilution provisions in the Debenture, the number of Immuron Shares issued on any conversion of the Debenture (other than where conversion is an automatic conversion as a result of the 2013 Fund Raising) will be calculated by dividing the outstanding Principal Amount by the “conversion price”, being the Canadian dollar equivalent at the Bank of Canada noon rate on the day of conversion of 4.73 Australian cents.

If the Debenture is converted at a conversion price of the Canadian dollar equivalent of 0.0473 Australian dollars (4.73 Australian cents), the share capital structure of the Company

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before and after the conversion (assuming no intervening anti-dilution events) would be as appears in column B of the Table A below. For the representative examples in Table A, a Canadian dollar/Australian dollar exchange rate of .9638 has been applied (which was the Bank of Canada noon rate on 15 February 2013.

In addition, the Debenture also includes provision for an automatic conversion where Immuron conducts the 2013 Fund Raising on or prior to 30 June 2013 and raises at least AU$1.5 million (excluding the funds raised under the Debenture) via an offer of securities. In the event of an automatic conversion as a result of a 2013 Fund Raising, the Debenture will convert at the lower of the Canadian dollar equivalent of 4.73 Australian cents and the issue price of the capital raising (provided that the minimum issue price for the ordinary shares under the capital raising is at a specified minimum issue price). At this time Immuron, has no commitments for any additional capital raising.

For any automatic conversion of the debenture, the number of Ordinary Shares and, if relevant, options, into which the Principal Amount will convert will be determined having regard to ASX Listing Rule 7.1 and Chapter 6 of the Corporations Act. Where that would require a smaller number than would otherwise be issued, Paladin can require Immuron to seek shareholder approval for the issue of the additional shares (and, if relevant, options). If shareholder approval is not obtained, Immuron must pay an additional amount (determined by reference to the additional shares and, if relevant, options, that could not be issued without shareholder approval) and/or issue a replacement convertible note representing the continued indebtedness.

The impact of the issue of the Debenture on the capital structure of the Company (subject to the anti-dilution provisions of the Debenture) is detailed in Table A below to outline -

(A) current issued capital immediately prior to the issue of the Debenture;

(B) share capital structure assuming conversion of the Debenture in full (ie, the maximum number of shares which may be issued under the Debenture terms) at the Canadian dollar equivalent of 4.73 Australian cents (either at the election of Paladin or on an automatic conversion event other than as a result of a 2013 Fund Raising); and

(C) share capital structure assuming automatic conversion in full (ie, the maximum number of shares which may be issued under the Debenture terms) as a result of a 2013 Fund Raising, but excluding any securities to be issued in connection with the 2013 Fund Raising.

Table A: share capital structure*

Type of security	(A) Shares on issue prior to the issue of the Debenture	(B) Shares on issue following the conversion of the Debenture (other than as a result of the 2013 Fund Raising)
Fully paid ordinary shares currently on issue	414,180,057	414,180,057
Shares that may be issued to Paladin labs Inc. under the terms of the Debenture		10,253,700 (Converted in full at the Canadian dollar equivalent of

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		4.73 Australian cents per share.)
Total fully paid ordinary shares on issue***	414,180,057	424,433,757

Important notes:

• This table is based on current issued capital and does not include the impact of any exercise of the Company's existing options (detailed in Table B below). If any options are exercised and shares are issued to option holders, this would decrease the relative proportion of shares held by Paladin on conversion (all things being equal). This table assumes a Canadian dollar/Australian dollar exchange rate of .9638 (which is the Bank of Canada noon rate on 15 February 2013).

** Note that these figures exclude the number of shares (if any) that may be issued under a 2013 Fund Raising. At the time of issue of this notice, Immuron has no commitments or decision in respect of any possible 2013 Fund Raising and therefore it is not possible to provide details of the impact of the automatic conversion of the Debenture where the conversion occurs as a result of any 2013 Fund Raising event.

*** The actual number of fully paid ordinary shares to be issued on conversion may be less than this number

Listed and unlisted options issued by the Company, (prior to the issue of Debenture) are as set out in Table B below:

Table B: options on issue

Description	Expiry date	Number
Listed options
	15 December 2013	2,752,230
	30 April 2015	116,024,381
Total listed options		118,776,611
Unlisted options****
Options issues to Chief executive Officer	31 May 2013	750,000
Options issued to staff and consultants under the employee share option plan	30 June 2014 30 June 2015	4,000,000 3,000,000

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	1 November 2017	7,000,000
Options issued to consultants	30 November 2021 17 January 2022	579,736 1,186,729
Total unlisted options on Issue		16,516,465
Total listed and unlisted options		135,293,076

****Whilst it is not regarded as an option to purchase shares, it is noted that should the Initial Debenture be converted (either on the occurrence of an automatic conversion event prior to 30 June 2013 or at any time prior to the Repayment Date at the election of Paladin), the conversion must be before 13 January 2015 (as the Initial Debenture will otherwise mature on that date). The Principal Amount of the Initial Debenture will convert at a conversion price of the Canadian dollar equivalent (at the Bank of Canada noon rate on the day of conversion) of AU$0.0473, as adjusted pursuant to the terms of the Initial Debenture. Using the Canadian dollar/Australian dollar exchange rate as at 15 February 2013, this would result in the issue of 20,375,518 additional fully paid ordinary shares at an issue price of AU$0.0473.

4. Rights and liabilities of the Immuron Shares

A summary of the rights attaching to the Immuron Shares is set out below. This summary is qualified by the full terms of the Constitution (a full copy of the Constitution is available from Immuron on request free of charge) and does not purport to be exhaustive or to constitute a definitive statement of the rights and liabilities of shareholders of Immuron ( Immuron Shareholders ). These rights and liabilities can involve complex questions of law arising from an interaction of Immuron's constitution with statutory and common law requirements. For an Immuron Shareholder to obtain a definitive assessment of the rights and liabilities which attach to shares in specific circumstances, the Immuron Shareholder should seek legal advice.

(a) General Meetings and Notice

Each Shareholder is entitled to receive notice of all general meetings of the Company and to receive all notices, accounts and other documents required to be sent to Shareholders under the Constitution, the Corporations Act or the Listing Rules. Shareholders are entitled to be present in person, or by proxy, attorney or representative to attend and vote at general meetings of the Company.

Shareholders may requisition meetings in accordance with section 249D of the Corporations Act.

(b) Voting Rights

Subject to any rights or restrictions for the time being attached to any class or classes of Shares, at general meetings of Shareholders or classes of Shareholders:

• (i) each Shareholder entitled to vote may vote in person or by proxy, attorney or representative;

• (ii) on a show of hands, every person present who is a Shareholder or a proxy, attorney or representative of a Shareholder entitled to vote has one vote; and

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• (iii) on a poll, every person present who is a Shareholder or a proxy, attorney or representative of a Shareholder entitled to vote shall, in respect of each fully paid Share held by him or her, or in respect of which he or she is appointed a proxy, attorney or representative, have one vote for every fully paid Share, but in respect of partly paid Shares shall have a fraction of a vote equal to the proportion that the amount paid bears to the issue price of the Shares.

(c) Dividend Rights

While there is no guarantee of any dividends or distributions by the Company, the Directors may from time to time declare dividends in compliance with the Corporations Act.

Subject to the rights of persons entitled to Shares with special rights as to dividends (at present there are none), all dividends are paid in the proportion that the amounts paid on those Shares bear to the issue price of the Shares.

(d) Winding Up

If the Company is wound up, the liquidator may, with the authority of a special resolution, divide among the Shareholders in kind the whole or any part of the property of the Company, and may for that purpose set such value as he or she considers fair upon any property to be so divided, and may determine how the division is to be carried out as between the Shareholders or different classes of Shareholders.

(e) Transfer of Shares

Shares in the Company are freely transferable, subject to formal requirements, and so long as the registration of the transfer does not result in a contravention of or failure to observe the provisions of a law of Australia and the transfer is not in breach of the Corporations Act or the Listing Rules.

• (f) Variation of Rights

The Company may, subject to the Corporations Act and with the sanction of a special resolution passed at a meeting of Shareholders, or with the written consent of the majority of Shareholders in the affected class, vary or abrogate the rights attaching to Shares.

5. Continuous disclosure obligations

5.1 Continuous disclosure

Immuron is a "disclosing entity" for the purposes of section 111AC of the Act. As such, it is subject to regular reporting and disclosure obligations which require it to disclose to ASX any information of which it is, or becomes, aware concerning it and which a reasonable person would expect to have a material effect on the price or value of securities of Immuron.

Immuron is also required to prepare and lodge with ASIC yearly and half yearly financial statements accompanied by a directors' statement and report and an audit report or review. Copies of documents lodged with ASIC in relation to Immuron may be obtained from or inspected at ASIC's office.

Immuron will provide a copy of each of the following documents, free of charge, to any person who asks for it:

• (a) the annual financial report for the financial year ended 30 June 2012, being the annual financial report most recently lodged with ASIC by Immuron; and

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• (b) any continuous disclosure notices given by Immuron after the lodgement of the annual financial report referred to in paragraph (a) above and before the lodgement of this Cleansing Notice with ASX.

Copies of documents lodged with ASIC in relation to Immuron may be obtained from, or inspected at, an office of ASIC.

Upon request, the Company will provide you with a copy of all documents used to notify the ASX of information relating to the Company (under the provisions of the Listing Rules) from 28 September 2012, being the date of lodgement of the Company's annual financial report for the year ending 30 June 2012, to the date of lodgement of this Notice (including the halfyear financial report to be lodged with ASIC for the period ending 31/12/2012), free of charge. A list of such documents is as follows:

• (a) Annual Report for Year Ended 30 June 2011 (28 September 2012)

• (b) Board Changes – Roger Aston appoint Chairman (8 October 2012)

• (c) Final Director's Interest Notice – Colin Chapman (8 October 2012)

• (d) Director Appointment / Resignation (11 October 2012)

• (e) Change of Registered Office and Business Address (15 October 2012)

• (f) Initial Director's Interest Notice (15 October 2012)

• (g) Immuron Company Update (18 October 2012)

• (h) Chairman's letter and Notice of Annual General Meeting (25 October 2012)

• (i) Patersons Research Report (13 November 2012)

• (j) Appendix 3B Issue of ESOP Unlisted Options (15 November 2012)

• (k) Chairman's Address and CEO Presentation to AGM (26 November 2012)

• (l) AGM Meeting Results (26 November 2012)

• (m) Clostiridium Difficile Project Update (17 December 2012)

• (n) Appendix 3B (6 February 2013).

5.2 No further information to disclose

Aside from the information contained in this Cleansing Notice and documents previously lodged by Immuron with the ASX pursuant to its continuous disclosure obligations, there is no additional information that:

• (a) has been excluded from a continuous disclosure notice in accordance with the Listing Rules; and

• (b) is information that investors and their professional advisers would reasonably require for the purpose of making an informed assessment of:

• (i) the assets and liabilities, financial position and performance, profits and losses and prospects of Immuron; and

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• (ii) the rights and liabilities attaching to the Debenture, Immuron Shares [or any options] to be issued on conversion of the Debenture.

6. No Responsibility

Neither ASX nor the ASIC take responsibility for the contents of this Cleansing Notice.

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Appendix 3B New issue announcement

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

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

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

Introduced 1/7/96. Origin: Appendix 5. Amended 1/7/98, 1/9/99, 1/7/2000, 30/9/2001, 11/3/2002, 1/1/2003, 24/10/2005.

Name of entity

Immuron Limited

ABN

80 063 114 045

We (the entity) give ASX the following information.

Part 1 - All issues

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

1 +Class of+securities issued or to be issued 2 Number of+securities issued or to be issued (if known) or maximum number which may be issued 3 Principal terms of the+securities (eg, if options, exercise price and expiry date; if partly paid+securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)	Fully paid ordinary shares
	Maximum number that may be issued is set out in 3and 9 below.
	Immuron has entered into a convertible debenture agreement (tranche2) with Paladin Labs Inc. for $CAD500,000. At the option of Paladin Labs Inc. those funds can be converted into fully paid ordinary shares in the Company at the lower of the following: 1. An Automatic Conversion at the issue price by the Company in its 2013 Fund Raising if the total funds raised exceed $1.5M; or 2. A conversion price of $A0.0473 prior to the maturity date of the debenture in January 2015.

• See chapter 19 for defined terms.

24/10/2005 Appendix 3B Page 1

Appendix 3B New issue announcement

4 Do the +securities rank equally in all respects from the date of allotment with an existing +class of quoted +securities? If the additional securities do not rank equally, please state:  the date from which they do  the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment  the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration 6 Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets) 7 Dates of entering+securities into uncertificated holdings or despatch of certificates 8 Number and+class of all +securities quoted on ASX (_including_the securities in clause 2 if applicable)	Yes	Yes
	Total consideration is $CAD500,000, approximately $A482,000based on current exchange rate.
	Tranche 2 funds will be used for working capital purposes.
	Future conversion date and thus date of issue of shares cannot be indicated at this point of time.
	Number	+Class
	414,180,057 2,752,230 116,024,381	Ordinary shares Options expiring 15 December 2013 Options expiring 30 April 2015

• See chapter 19 for defined terms.

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9 Number and +class of all +securities not quoted on ASX (_including_the securities in clause 2 if applicable) 10 Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests)	Number	+Class
	750,000 4,000,000 20,375,518 579,736 1,186,729 3,000,000 7,000,000 10,253,700	Options IMCJB2 Expiring 31 May 2013 Options IMCSO Expiring 30 June 2014 This is the maximum number of ordinary shares that can be issued to Paladin Labs Inc. under the terms of the convertible debenture entered into in December 2011. The conversion into fully paid ordinary shares is to be no later than December 2014. Options IMCRM1 Expiring 30 November 2021 Options IMCRM2 Expiring 17 January 2022 Options IMCSO1 Expiring 30 June 2015. Options IMCSO2 Expiring 1 November 2017 This is the maximum number of shares that can be issued to Paladin Labs Inc. under the terms of the Tranche 2 Convertible Debenture at a conversion price of $0.0473 no later than January 2015. Potential shares to be issued in accordance with the Automatic Conversion Terms re a 2013 Fund Raising cannot be determined at thispoint of time.
	Not applicable.

Part 2 - Bonus issue or pro rata issue

• See chapter 19 for defined terms.

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11 Is security holder approval required? 12 Is the issue renounceable or non- renounceable? 13 Ratio in which the+securities will be offered 14 +Class of+securities to which the offer relates 15 +Record date to determine entitlements 16 Will holdings on different registers (or subregisters) be aggregated for calculating entitlements? 17 Policy for deciding entitlements in relation to fractions 18 Names of countries in which the entity has+security holders who will not be sent new issue documents Note: Security holders must be told how their entitlements are to be dealt with. Cross reference: rule 7.7. 19 Closing date for receipt of acceptances or renunciations 20 Names of any underwriters 21 Amount of any underwriting fee or commission 22 Names of any brokers to the issue 23 Fee or commission payable to the broker to the issue 24 Amount of any handling fee payable to brokers who lodge acceptances or renunciations on behalf of+security holders

• See chapter 19 for defined terms.

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25	If the issue is contingent on
	+security holders’ approval, the
	date of the meeting
26	Date entitlement and acceptance
	form and prospectus or Product
	Disclosure Statement will be sent to
	persons entitled
27	If the entity has issued options, and
	the terms entitle option holders to
	participate on exercise, the date on
	which notices will be sent to option
	holders
28	Date rights trading will begin (if
	applicable)
29	Date rights trading will end (if
	applicable)
30	How do+security holders sell their
	entitlements_in full_through a
	broker?
31	How do+security holders sell_part_
	of their entitlements through a
	broker and accept for the balance?
32	How do+security holders dispose
	of their entitlements (except by sale
	through a broker)?
33	+Despatch date

Part 3 - Quotation of securities

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

34 Type of securities Fully paid ordinary shares ( tick one )

• (a)

• (b)[All other securities ]

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

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

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

36 If the[+] securities are[+] equity securities, a distribution schedule of the additional +securities setting out the number of holders in the categories 1 - 1,000 1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,001 and over

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

Entities that have ticked box 34(b)

38 Number of securities for which +quotation is sought 39 Class of +securities for which quotation is sought 40 Do the[+] securities rank equally in all respects from the date of allotment with an existing[+] class of quoted +securities? If the additional securities do not rank equally, please state:  the date from which they do  the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment  the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment

• See chapter 19 for defined terms.

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41 Reason for request for quotation now Example: In the case of restricted securities, end of restriction period (if issued upon conversion of another security, clearly identify that other security)

Number +Class

2 Number and[+] class of all[+] securities quoted on ASX ( including the securities in clause 38)

Quotation agreement

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

• 2 We warrant the following to ASX.

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

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

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

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

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

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

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

• 4 We give ASX the information and documents required by this form. If any information or document not available now, will give it to ASX before[+] quotation of

• See chapter 19 for defined terms.

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the[+] securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

==> picture [374 x 157] intentionally omitted <==

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

Sign here: ......Date: 18 February 2013
........................
Print name: Graeme Stevens
Company Secretary .........................................................
----- End of picture text -----

• See chapter 19 for defined terms.

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