Nexus Battle (www.nexusbattle.com), which represents the...

Nexus Battle (www.nexusbattle.com), which represents the interests of approximately 11% of Nexus Energy Limited’s (Nexus’) minor shareholders (by shareholding), would like to raise a series of points and questions that we believe require further analysis and clarification from McGrathNicols and Gresham Advisory Partners Limited (Gresham).

In raising these points, Nexus Battle are attempting to derive a positive return for all parties involved in Nexus, including Seven Group Holdings (SGH), Nexus shareholders, note holders, Nexus employees, Board Members and creditors. Also, by deriving a fair outcome for all parties we also seek to avoid any potential litigious Court action that may be initiated.

1.Principally, Nexus has been unable to field offers from third parties, due to the “no shop and no talk” clause 11.2 in the Merger Implementation Agreement (MIA), from the announcement of the MIA on 31 March 2014 until the voting of the Scheme on 12 June 2014. Therefore, the only time that Nexus is able to field offers is while it is in Voluntary Administration, and Gresham have requested that unconditional offers are placed by 30 July 2014. We strongly believe this period of six weeks is not sufficient for companies to undertake a full due diligence, and our concern is that with this limited timeframe that only bids at fire-sale prices will be placed by interested parties.

2.Regarding the SGH $30m funding placement, we enquire as to whether are there other options available to the administrators from third parties, and are these options being pursued in order to push back the 30 July 2014 deadline? An extended time frame will allow a more rigorous sale process by Gresham, and seeking alternatives to the SGH $30m funding should remain a priority for McGrathNicols.

3.Nexus Battle seeks a Board position and we understand from speaking to McGrathNicols that this could not be implemented by McGrathNicols but would need to be sanctioned by the Board. After speaking to a Board Representative we have been told the Board of Nexus cannot do this and it is the responsibility of McGrathNicols. Shareholders should have the opportunity for representation at Board level and we seek clarification as to why
McGrathNicols does not consider this possible, considering the pedigree of our potential applicants, or otherwise how this can be made possible. 4.An outline of a strategy has been submitted to McGrath Nicol from a Nexus shareholder that
we believe could help deliver a positive outcome to all stakeholders. We ask that the underlying premise of this proposal be given a full and detailed review by McGrathNicols to validate if this strategy is possible.

Nexus Battle have never been against an offer from SGH, nor from any other party, provided that it is fair and reasonable and takes into consideration the embedded value of the production, development and exploration assets, and also considers other benefits that accrue from 100% control.

I look forward to your timely response.