Early Warning Report Filed Pursuant – To The National Instrument 62-103

September 2, 2010 –

1. Name and address of the offeror:Richard W. Hughes, Hastings Management Corp.
   675 — 711 West Hastings St.
   Vancouver, B.C. V6B 1N2(collectively the “Offeror”)
2. Name of reporting issuer with respect to which this report is filed:Chalice Diamond Corp. (the “Company”)
3. Designation and number or principal amount of securities and the offeror’s security‐holding percentage in the class of securities of which the offeror acquired ownership or control in the transaction or occurrence giving rise to the obligation to file the news release and whether it was ownership or control that was acquired in those circumstances:The Offeror acquired ownership of 15,391,608 common shares of the Company via acquisitions on the public market and participations in private placements (the “Acquisition”).
4. Designation and number or principal amount of securities and the offeror’s security‐holding percentage in the class of securities immediately after the transaction or occurrence giving rise to obligation to file the news release.As a result of the Acquisition noted in paragraph 3 above, the Offeror owns or controls a total of 15,391, 608 common shares, representing approximately 14% of the 109,891,518 currently issued and outstanding common shares of the Company.The Offer also owns or controls a total of 8,813,779 share purchase warrants. If all of these warrants were exercised, the Offeror would own or control a total of 24,205,387 common shares, representing approximately 20.39% of the 118,705,297 then issued and outstanding common shares of the Company.
5. Designation and number or principal amount of securities and the percentage of outstanding securities of the class of securities referred to in paragraph (4) over which:(a) the offeror, either alone or together with any joint actors, has ownership and control.The Offeror owns or controls a total of 15,391,608 common shares, representing approximately 14% of the 109,891,518 currently issued and outstanding common shares of the Company.

   The Offer also owns or controls a total of 8,813,779 share purchase warrants. If all of these warrants were exercised, the Offeror would own or control a total of 24,205,387 common shares, representing approximately 20.30% of the 118,705,297 then issued and outstanding common shares of the Company.

   (b) the offeror, either alone or together with any joint actors, has ownership but control is held by other persons or companies other than the offeror or any joint actor, and

   Not applicable

   (c) the offeror, either alone or together with any joint actors, has exclusive or share control but does not have ownership

   Not applicable

6. Name of the market in which the transaction or occurrence that gave rise to the news release took place.The shares of the Company are listed on the TSX Venture Exchange.
7. Purpose of the offeror and any joint actors in effecting the transaction or occurrence that gave rise to the news release, including any future intention to acquire ownership of, or control over, additional securities of the reporting issuer.The shares were acquired for investment purposes. Depending on market and other conditions, the Offeror may from time to time in the future increase or decrease its ownership, control or direction over the Common Shares or other securities of the Issuer, through market transactions, private agreements or otherwise.
8. General nature and the material terms of any agreement, other than lending arrangements with respect to securities of the reporting issuer entered into by the offeror, or any joint actor, and the issuer of the securities or any other entity in connection with the transaction or occurrence giving rise to the news release, including agreements with respect to the acquisition, holding, disposition or voting of any of the securities.Not applicable.
9. Name of any joint actors in connection with the disclosure required by this report.Not Applicable.
10. In the case of a transaction or occurrence that did not take place on a stock exchange or other market that represents a published market for the securities, including an issuance from treasury, the nature and value of the consideration paid by the offeror.Not applicable.
11. If applicable, a description of any change in any material fact set out in a previous report by entity under the early warning requirements or Part 4 of National Instrument 62‐103 in respect of the reporting issuer’s securities.Not applicable.

DATED this 2nd day of September 2010

HASTINGS MANAGEMENT CORP.

/s/”Richard W. Hughes” BY: /s/ “Richard W. Hughes”, President