Merlin Diamonds : Entitlements Offer – 27/10/2017

Merlin Diamonds Limited ABN 86 009 153 119 Offer Document

For

A non-renounceable pro rata offer of New Shares at an issue price of $0.005 per New Share on the basis of two (2) New Share for every five (5) Shares held on the Record Date to Eligible Shareholders.

This document is important and requires your immediate attention. It should be read in its entirety. If you do not understand its content or are in doubt as to the course you should follow, you should consult your stockbroker or professional adviser without delay. This Offer opens on 16 November 2017 and closes at 5:00pm AEDT on 28 November 2017 Valid acceptances must be received before that time

These opening and closing dates are indicative only. Subject to the Listing Rules and any applicable law, the

Directors reserve the right to vary these dates, including the Closing Date, at their discretion.

Please read the instructions in this document and on the accompanying Entitlement and Acceptance Form regarding the acceptance of your entitlement.

Event	Date
Offer Document lodgement date	27 October 2017
Dispatch of notices to Eligible Shareholders informing them of the Offer and details of Appendix 3B	9 November 2017
Shares trade "Ex"	10 November 2017
Record Date (date for determining entitlements of Eligible Shareholders to participate in the Offer) (7pm AEDT)	13 November 2017
Offer opens - Offer Document dispatched to Eligible Shareholders (expected date of dispatch of Offer Document and Entitlement and Acceptance Forms)	16 November 2017
Last day to extend Offer closing date	23 November 2017
Closing Date (5pm AEDT)	28 November 2017
Shares quoted on a deferred settlement basis	29 November 2017
Merlin notifies ASX of under subscriptions	1 December 2017
Issue of New Shares	1 December 2017
Dispatch of Holding Statements & Deferred Settlement ends. Last day for advising ASX of all information required by Appendix 3B	4 December 2017
Trading of New Shares to commence on ASX	4 December 2017
Latest date for Directors to place any shortfall	16 January 2018

IMPORTANT INFORMATION INDICATIVE TIMETABLE PRO-RATA NON-RENOUNCEABLE ENTITLEMENT ISSUE

These dates are indicative only. Subject to the Listing Rules and any applicable law, the Directors reserve the right to vary these dates, including extending the Closing Date by giving at least 3 Business Days' notice to ASX prior to the Closing Date and the date that the New Shares are expected to commence trading on ASX. Should this occur, the extension will have a consequential effect on the above timetable.

OFFER DOCUMENT

This Offer Document is dated 27 October 2017 and was lodged with ASX on that date.

This Offer Document is not a prospectus under the Corporations Act and has not been lodged with Australian Securities and Investments Commission (ASIC).Neither ASIC nor the ASX takes responsibility for the contents of this Offer Document or the merits of the investment to which the Offer Document relates.

This offer Document has been prepared in accordance with section 708AA of the Corporations Act (as modified by ASIC Instrument 2016/84). In preparing this Offer Document regard has been had to the fact that the Company is a disclosing entity for the purposes of Corporations Act and certain matters may reasonably be expected to have been known to investors and professional advisers who investors may consult. Eligible Shareholders should rely on their own knowledge of the Company, refer to disclosures made by the Company to ASX and consult their professional advisers before deciding whether to accept the Offer. Announcements made by the Company to ASX are available from the ASX website www.asx.com.au.

The information provided in this Offer Document is not investment advice and has been prepared without taking into account your investment objectives, financial situation or particular needs (including financial and taxation

issues). It is important that you read and consider the information in this Offer Document in full before deciding to invest in New Shares, consider the risks that could affect the performance of the Company and seek professional advice from your accountant, tax adviser, stockbroker, lawyer or other professional adviser before deciding to invest.

The information in this Offer Document does not constitute a securities recommendation or financial product advice and no person is authorised to give any information or to make any representation in connection with the Offer. Any information or representation which is not contained in this Offer Document or disclosed by the Company pursuant to its continuous disclosure obligations may not be relied upon as having been authorised by the Company in connection with the Issue of this Offer Document.

Application for admission of the New Shares offered by this Offer Document to quotation by ASX will be made within seven days after the date of this Offer Document.

Applications for Shares offered pursuant to this Offer Document can only be submitted on an original Entitlement and Acceptance Form or Shortfall Application Form or making payment of Acceptance Monies in BPAY® in accordance with the instructions set out in this Offer Document and on the Entitlement and Acceptance Form. See section 2 and in particular section 2.7(b).

RISKS

Applicants should read this document in its entirety and, if in any doubt, consult with their professional advisers before deciding whether to apply for New Shares. There are risks associated with an investment in Merlin Diamonds Limited, and the New Shares offered under this Offer Document must be regarded as a speculative investment. In particular, you should consider the risk factors that could affect the value of an investment in the Company, some of which are outlined in Section 3 of the Offer Document. The New Shares offered under this Offer Document carry no guarantee with respect to return on capital investment, payment of dividends or the future value of the New Shares.

No person (whether named in this Offer Document or otherwise) guarantees the performance of Merlin Diamonds Limited, the repayment of capital or the payment of a return on the Shares.

OVERSEAS SHAREHOLDERS

This Offer Document does not constitute an offer or invitation in any place in which, or to any person to whom it would not be lawful to make such an offer for invitation. The distribution of this Offer Document in jurisdictions outside Australia may be restricted by law and persons who come into possession of this Offer Document should seek advice on and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of applicable securities law.

The Offer contained in this Offer Document to Eligible Shareholders with registered addresses in New Zealand is made in reliance on the Securities Act (Overseas Companies) Exemption Notice 2013 (New Zealand). This Offer Document is not an investment statement or Offer Document under New Zealand law, and may not contain all the information that an investment statement or Offer Document under New Zealand law is required to contain. Members of the public in New Zealand who are not existing Shareholders on the Record Date are not entitled to apply for New Shares.

The distribution of this Offer Document in jurisdictions outside Australia and New Zealand may be restricted by law and therefore persons who come into possession of this Offer Document should seek advice on and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of those laws. This Offer Document does not constitute an offer of New Shares in any jurisdiction where, or to any person to whom, it would be unlawful to make such an offer. Certain terms and abbreviations used in this Offer Document have defined meanings, which are explained in Section 6 of this Offer Document.

FORWARD-LOOKING STATEMENTS

This Offer Document contains forward-looking statements which are identified by words such as 'may', 'could',

'believes', 'estimates', 'targets', 'expects', or 'intends' and other similar words that involve risks and uncertainties.

These statements are based on an assessment of present economic and operating conditions, and on a number of assumptions regarding future events and actions that, as at the date of this Offer Document, are expected to take place.

Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, assumptions and other important factors, many of which are beyond the control of our Company, the Directors and our management.

We cannot and do not give any assurance that the results, performance or achievements expressed or implied by the forward-looking statements contained in this Offer Document will actually occur and investors are cautioned not to place undue reliance on these forward-looking statements.

We have no intention to update or revise forward-looking statements, or to publish prospective financial information in the future, regardless of whether new information, future events or any other factors affect the information contained in this Offer Document, except where required by law.

These forward looking statements are subject to various risk factors that could cause our actual results to differ materially from the results expressed or anticipated in these statements. These risk factors are set out in section 3 of this Offer Document.

ELECTRONIC OFFER DOCUMENT

Eligible Shareholders can obtain a copy of this Offer Document during the Offer Period on the Company's website at http://www.merlindiamonds.com.au. The Offer is only available to Eligible Shareholders receiving this Offer Document in electronic form within Australia. If you access an electronic copy of this Offer Document, you should read the entire Offer Document.

The electronic copy of this Offer Document will not include a personalised Entitlement and Acceptance Form. Eligible Shareholders will only be able to accept the Offer by completing the personalised Entitlement and Acceptance Form which accompanies this Offer Document or by making payment using BPAY® (refer to Section 2 and in particular section 2.9(b) for further information).

FINANCIAL AMOUNTS

Money as expressed in this Offer Document is in Australian dollars.

PRIVACY

Please read the privacy information set out in Section 1.21. By submitting an Entitlement and Acceptance Form, you consent to the matters outlined in that section.