MineGem Inc. — M&A Activity 2003

Oct 1, 2003

FORM 27 THE SECURITIES ACT MATERIAL CHANGE REPORT UNDER SECTION (75) 2

Item 1. Item 2. Item 3. Item 4. Item 5. Item 6. Item 7. Item 8. Item 9.

Reporting Issuer MineGem Inc.,4th Floor, 56 Temperance Street, Toronto, Ontario, M5H 3V5. Date of Material Change September 29, 2003. Press Release The Press Release was sent on September 29, 2003 CCN Matthews -- Toronto, Ontario. Summary of Material Change For further information, attached hereto is a copy of the Press Release. Full Description of Material Change No information other than that provided in Item 4 above is presently available. Reliance on Section 75(3) of the Act Confidentiality is not requested. Omitted Information No information has been omitted in respect to the material change. Senior Officer Mr. David Jones, Chairman, [416] 214-4884. Statement of Senior Officer

The foregoing accurately discloses the material changes referred to herein.

DATED at Toronto, this 30th day of September, 2003.

MINEGEM INC.

“David Jones”

Per:

______ David Jones, Chairman

E:\messina\F27Sept30-2003

MINEGEM INC.

NEWS RELEASE

DATED: September 29, 2003 Toronto, Ontario

FOR IMMEDIATE RELEASE CONTACT: DAVID JONES +1 416 214 4884

MineGem Inc. (YGL-TSX VENTURE) ("MineGem") today confirmed that it has received from European Diamonds PLC ("EPD") an unsolicited offer to acquire all of MineGem's issued and outstanding common shares. EPD's shares trade on the London Stock Exchange's Alternative Investment Market under the symbol "EPD".

EPD is offering one ordinary 5p share for every 10 MineGem common shares. Based on EPD's closing price on September 26, 2003 of 70.5p per share, the offer values MineGem at approximately £3.5 million or Cdn$7.9 million on an undiluted basis, representing a premium of 111% to MineGem's closing price on the TSX Venture Exchange on September 26, 2003 of Cdn.$0.075.

MineGem has been advised that EMP's takeover bid circular dated September 26, 2003 will be delivered to MineGem shareholders shortly. The offer is open for acceptance until 9:00 a.m. (Toronto time) on November 4, 2003, unless withdrawn or extended, and is subject to usual terms and conditions, including the condition that the number of shares validly tendered to the Offer and not withdrawn constitutes not less than 50.01% of the number of outstanding common shares of MineGem.

MineGem's board of directors is in the process of preparing its recommendations on the offer and anticipates mailing its recommendations in a Directors' Circular prior to October 14, 2003.

For further information, please contact:

David Jones: Chairman Telephone: +1 416 214 4884

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.