Convertible Notes

In Septemebr 2010 the company made a placement of 25.0 million convertible notes at 4.0 cents each to sophisticated and professional investors.

The principal terms of the notes are:

• Interest payable every 6 months at a rate of 10% per annum;
• Convertible 1:1 into fully paid ordinary Nagambie Mining Limited shares at any time within the maximum 5-year life of the notes at the option of the holder;
• Redeemable in cash in full after 5 years if not converted;
• Unsecured but rank ahead of shareholders; and
• Protected for reorganization events (bonus issues, share consolidations etc).