ALARA RESOURCES LIMITED — Capital/Financing Update 2011

Apr 26, 2011

Alara Resources Limited ABN 27 122 892 719

Appendix 3B New issue announcement

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX’s property and may be made public.

Introduced 1/7/96. Origin: Appendix 5. Amended 1/7/98, 1/9/99, 1/7/2000, 30/9/2001, 11/3/2002, 1/1/2003.

Name of entity

ALARA RESOURCES LIMITED (AUQ)

ABN

27 122 892 719

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

1 +Class of+securities issued or to be issued 2 Number of+securities issued or to be issued (if known) or maximum number which may be issued 3 Principal terms of the+securities (eg, if options, exercise price and expiry date; if partly paid+securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)	Fully Paid Ordinary Shares
	18,000,000
	Same rights as other fully paid ordinary shares on issue.

• See chapter 19 for defined terms.

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Alara Resources Limited ABN 27 122 892 719

Appendix 3B New issue announcement

4 Do the+securities rank equally in all respects from the date of allotment with an existing+class of quoted+securities? If the additional securities do not rank equally, please state: the date from which they do the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration 6 Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets) 7 Dates of entering+securities into uncertificated holdings or despatch of certificates 8 Number and +class of all +securities quoted on ASX (including the securities in clause 2 if applicable) 9 Number and +class of all +securities not quoted on ASX (_including_the securities in clause 2 if applicable)	Same rights as other fully paid ordinary shares on issue.	Same rights as other fully paid ordinary shares on issue.	Same rights as other fully paid ordinary shares on issue.
	$0.36 each
	Placement to professional and institutional investors. Please also refer to the Company’s ASX market announcements dated:  21 April 2011 and entitled “Completion of Tranche 1 $6.48 Million Share Placement and Updated Top 20 Shareholders ”; and  14 April 2011 and entitled “Completion of $30 Million Capital Raising ”
	20 April 2011
	Number		~~+~~Class
	144,507,500 (also refer Table A)		ORDINARY (ASX Code: AUQ)
	Refer Table A
	Number		~~+~~Class
	Refer Table A

• See chapter 19 for defined terms.

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Alara Resources Limited ABN 27 122 892 719

Appendix 3B New issue announcement

TABLE A - RECONCILIATION OF QUOTED AND UNQUOTED SECURITIES:

The Company currently has the following securities on issue:

	Quoted
	on ASX	Unlisted	Total
Fully paid ordinary shares	144,507,500	-	144,507,500
$0.55 (26 July 2012) Unlisted Options 1	-	500,000	500,000
$0.35 (16 September 2013) Unlisted Options 2	-	16,400,000	16,400,000
$0.35 (16 September 2013) Unlisted Options 2	-	1,035,000	1,035,000
$0.35 (25 October 2014) Unlisted Options 3	-	3,650,000	3,650,000
$0.60 (25 October 2014) Unlisted Options 3	-	2,000,000	2,000,000
$0.35 (22 August 2015) Unlisted Options 4	-	400,000	400,000
Total	144,507,500	23,985,000	168,492,500

10 Dividend policy (in the case of Same rights as other fully paid ordinary shares a trust, distribution policy) on on issue. the increased capital (interests)

Part 2 - Bonus issue or pro rata issue

11 Is security holder approval required? 12 Is the issue renounceable or non-renounceable? 13 Ratio in which the+securities will be offered 14 +Class of+securities to which the offer relates 15 +Record date to determine entitlements 16 Will holdings on different registers (or subregisters) be aggregated for calculating entitlements?	N/A
	N/A
	N/A
	N/A
	N/A
	N/A

1 Terms and conditions of issue are set out in a Notice of Meeting and Explanatory Statement dated 21 June 2007 for a General Meeting held on 7 July 2007 and in an ASX Appendix 3B New Issue Announcement lodged on 3 August 2007

2 Terms and conditions of issue are set out in a Notice of Meeting and Explanatory Statement dated 18 August 2008 for a General Meeting held on 17 September 2008 and in an ASX Appendix 3B New Issue Announcement lodged on 24 September 2008

3 Terms and conditions of issue are set out in a Notice of Meeting and Explanatory Statement dated 26 October 2009 for an Annual General Meeting held on 30 November 2009 and in ASX Appendix 3B New Issue Announcements lodged on 26 October 2009 and 1 December 2009

4 Terms and conditions of issue are set out in an ASX Appendix 3B New Issue Announcements lodged on 23 August 2010

• See chapter 19 for defined terms.

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Alara Resources Limited ABN 27 122 892 719

Appendix 3B New issue announcement

17 Policy for deciding entitlements in relation to fractions 18 Names of countries in which the entity has+security holders who will not be sent new issue documents Note: Security holders must be told how their entitlements are to be dealt with. Cross reference: rule 7.7. 19 Closing date for receipt of acceptances or renunciations 20 Names of any underwriters 21 Amount of any underwriting fee or commission 22 Names of any brokers to the issue 23 Fee or commission payable to the broker to the issue 24 Amount of any handling fee payable to brokers who lodge acceptances or renunciations on behalf of+security holders 25 If the issue is contingent on +security holders’ approval, the date of the meeting 26 Date entitlement and acceptance form and prospectus or Product Disclosure Statement will be sent to persons entitled 27 If the entity has issued options, and the terms entitle option holders to participate on exercise, the date on which notices will be sent to option holders 28 Date rights trading will begin (if applicable) 29 Date rights trading will end (if applicable) 30 How do+security holders sell	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A

• See chapter 19 for defined terms.

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Alara Resources Limited ABN 27 122 892 719

Appendix 3B New issue announcement

their entitlements_in full_through a broker? 31 How do+security holders sell _part_of their entitlements through a broker and accept for the balance? 32 How do +security holders dispose of their entitlements (except by sale through a broker)? 33 +Despatch date
	N/A
	N/A
	N/A

Part 3 - Quotation of securities

You need only complete this section if you are applying for quotation of securities

34 Type of securities ( tick one )

(a)[Securities described in Part 1 ]

(b)[All other securities ]

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

• 35[If the ][+][securities are ][+][equity securities, the names of the 20 largest holders of ] the additional[+] securities, and the number and percentage of additional +securities held by those holders

• 36[If the ] +securities setting out the number of holders in the categories[+][securities are ][+][equity securities, a distribution schedule of the additional ] 1 - 1,000

1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,001 and over

37

• [A copy of any trust deed for the additional ][+][securities ]

• See chapter 19 for defined terms.

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Alara Resources Limited ABN 27 122 892 719

Appendix 3B New issue announcement

Entities that have ticked box 34(b)

38 Number of securities for which +quotation is sought 39 Class of+securities for which quotation is sought 40 Do the+securities rank equally in all respects from the date of allotment with an existing+class of quoted+securities? If the additional securities do not rank equally, please state: the date from which they do the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 41 Reason for request for quotation now Example: In the case of restricted securities, end of restriction period (if issued upon conversion of another security, clearly identify that other security) 42 Number and +class of all +securities quoted on ASX (_including_the securities in clause 38)	N/A
	N/A
	N/A
	N/A
	Number	+Class
	N/A

• See chapter 19 for defined terms.

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Alara Resources Limited ABN 27 122 892 719

Appendix 3B New issue announcement

Quotation agreement

• 1 +Quotation of our additional +securities is in ASX’s absolute discretion. ASX may quote the[+] securities on any conditions it decides.

• 2 We warrant the following to ASX.

• The issue of the[+] securities to be quoted complies with the law and is not for an illegal purpose.

• There is no reason why those[+] securities should not be granted +quotation.

• An offer of the[+] securities for sale within 12 months after their issue will not require disclosure under section 707(3) or section 1012C(6) of the Corporations Act.

Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any[+] securities to be quoted and that no-one has any right to return any[+] securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the[+] securities be quoted.

• We warrant that if confirmation is required under section 1017F of the Corporations Act in relation to the[+] securities to be quoted, it has been provided at the time that we request that the[+] securities be quoted.

• If we are a trust, we warrant that no person has the right to return the +securities to be quoted under section 1019B of the Corporations Act at the time that we request that the[+] securities be quoted.

• 3 We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.

• 4 We give ASX the information and documents required by this form. If any information or document not available now, will give it to ASX before +quotation of the +securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

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Sign here: .......................................................... Date: 27 April 2011

(Company Secretary)

Print name: VICTOR HO

• See chapter 19 for defined terms.

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Alara Resources Limited Telephone | +61 8 9214 9787 A.B.N. 27 122 892 719 Facsimile | +61 8 9322 1515 Level 14, The Forrest Centre Web | www.alararesources.com 221 St Georges Terrace Email | info@alararesources.com Perth Western Australia 6000

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NOTICE UNDER PARAGRAPH 708A(5)(E) OF THE CORPORATIONS ACT 2001 (CTH)

Pursuant to the capital raising announced on 14 April 2011 (Completion of $30 Million Capital Raising) and 21 April 2011 (Completion of Tranche 1 $6.48 Million Share Placement and Updated Top 20 Shareholders), Alara Resources Limited ACN 122 892 719 ( Company ) has issued 18,000,000 fully paid ordinary shares in the Company at an issue price of $0.36 per share ( Shares ) to a range of professional and institutional investor clients of Petra Capital Pty Ltd, on 20 April 2011.

The Company relies on Section 708A(5) of the Corporations Act 2001 (Cth) ( Corporations Act ) in respect of the issue of the Shares without disclosure, and gives notice under paragraph 708A(5)(e) of the Corporations Act that:

1. the Company issued the Shares without disclosure to investors under Part 6D.2 of the Corporations Act;

2. as at the date of this notice, the Company has complied with:

3. (a) the provisions of Chapter 2M of the Corporations Act as they apply to the Company; and

4. (b) section 674 of the Corporations Act; and

5. as at the date of this notice, there is no excluded information within the meaning of sections 708A(7) and 708A(8) of the Corporations Act, save for the following information:

6. (a) The Company’s cash (and investments in listed securities) position was approximately $8 million as at 31 March 2011 (31 December 2010: 13.1 million);

7. (b) As at 31 March 2011, the Company’s investment in listed securities had a total value of $1.30 million (31 December 2010: $1.54 million in respect of the same shareholding).

Dated: 27 April 2011

For and on behalf of the Board,

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Victor Ho Company Secretary

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ASX Code | AUQ