CAZALY RESOURCES LIMITED — Director's Dealing 2011

Aug 21, 2011

==> picture [188 x 70] intentionally omitted <==

22 August 2011

Sebastian Bednarczyk ASX Compliance Pty Limited Level 8 Exchange Plaza 2 The Esplanade PERTH WA 6000

By email: Sebastian.Bednarczyk@asx.com.au

Dear Sebastian

In response to your letter dated 19 August 2011 regarding the late lodgement of an Appendix 3Y for Mr Clive Jones, Cazaly Resources Limited (“Cazaly” or “the Company”) responds as follows:

1. Please explain why the Appendix was lodged late

The Appendix was lodged late due to an internal administrative oversight. The notice was lodged immediately upon the oversight having been identified.

1. What arrangements does the Company have in place with its directors to ensure that it is able to meet its disclosure obligations under listing rule 3.19A

The Company has entered into an agreement with it’s Directors and has a process that requires all Directors to notify the Company Secretary of any transactions involving any change of their notifiable interest immediately or at the very latest, within three business days after the changes occur. Additionally, the Company Secretary and the officers assigned to report to the ASX review the directors’ shareholding regularly to ensure that all relevant movements are reported to the ASX within the time frame.

3. If the current arrangements are inadequate or not being enforced, what additional steps does the Company intend to take to ensure compliance with listing rule 3.19B

Apart from this administrative oversight, the Company considers the current arrangements to be adequate to ensure compliance with listing rule 3.19B.

Yours sincerely

Lisa Wynne

Company Secretary

Level 2, 38 Richardson Street West Perth Western Australia, 6005. PO Box 396, West Perth, Western Australia, 6872 Phone: +61 8 9322 6283 Fax: +61 8 9322 6398 email: admin@cazalyresources.com.au ACN 101 049 334 www.cazalyresources.com.au

==> picture [48 x 80] intentionally omitted <==

ASX Compliance Pty Limited ABN 26 087 780 489 Level 8 Exchange Plaza 2 The Esplanade PERTH WA 6000

GPO Box D187 PERTH WA 6840

19 August 2011

Lisa Wynne Company Secretary Cazaly Resources Limited 38 Richardson Street WEST PERTH WA 6005

Telephone 61 8 9224 0000 Facsimile 61 8 9221 2020 www.asx.com.au

By Email: lisa@cazalyresources.com.au

Dear Lisa,

Cazaly Resources Limited (the “Company ”)

We refer to the following;

1. The Appendix 3Y lodged by the Company with ASX on 8 August 2011 for Clive Bruce Jones (the “Director Notice”);

2. Listing rule 3.19A which requires an entity to tell ASX the following:

3. 3.19A.1 The notifiable interests of a director of the entity (or in the case of a trust, a director of the responsible entity of the trust) at the following times.

   • On the date that the entity is admitted to the official list.

   • On the date that a director is appointed.

   • The entity must complete Appendix 3X and give it to ASX no more than 5 business days after the entity’s admission or a director’s appointment.

4. 3.19A.2 A change to a notifiable interest of a director of the entity (or in the case of a trust, a director of the responsible entity of the trust) including whether the change occurred during a closed period where prior written clearance was required and, if so, whether prior written clearance was provided. The entity must complete Appendix 3Y and give it to ASX no more than 5 business days after the change occurs.

5. 3.19A.3 The notifiable interests of a director of the entity (or in the case of a trust, a director of the responsible entity of the trust) at the date that the director ceases to be a director. The entity must complete Appendix 3Z and give it to ASX no more than 5 business days after the director ceases to be a director.

6. Listing rule 3.19B which states as follows.

An entity must make such arrangements as are necessary with a director of the entity (or in the case of a trust, a director of the responsible entity of the trust) to ensure that the director discloses to the entity all the information required by the entity to give ASX completed

==> picture [48 x 80] intentionally omitted <==

Appendices 3X, 3Y and 3Z within the time period allowed by listing rule 3.19.A. The entity must enforce the arrangements with the director.

1. The Companies Update dated 27 June 2008, reminding listed entities of their obligation to notify ASX within 5 business days of the notifiable interests in securities held by each director and outlining the action that ASX would take in relation to breaches of listings rules 3.19A and 3.19B.

The Appendix 3Y indicates that a change in Director’s notifiable interest occurred on 18 July 2011. It appears that the Director’s Notice should have been lodged with ASX by 25 July 2011. Consequently, the Company may be in breach of listing rules 3.19A and/or 3.19B. It also appears the directors concerned may have breached section 205G of the Corporations Act.

Please note that ASX is required to record details of breaches of the listing rules by listed companies for its reporting requirements.

ASX reminds the Company of its contract with ASX to comply with the listing rules. In the circumstances ASX considers that it is appropriate that the Company make necessary arrangements to ensure there is not a reoccurrence of a breach of the listing rules.

Having regard to listing rules 3.19A and 3.19B and Guidance Note 22: “Director Disclosure of Interests and Transactions in Securities - Obligations of Listed Entities”, we ask that you answer each of the following questions:

1. Please explain why the Appendix was lodged late.

2. What arrangements does the Company have in place with its directors to ensure that it is able to meet its disclosure obligations under listing rule 3.19A?

3. If the current arrangements are inadequate or not being enforced, what additional steps does the Company intend to take to ensure compliance with listing rule 3.19B?

Your response should be sent to me by e-mail at sebastian.b@asx.com.au or by facsimile on facsimile number (08) 9221 2020. It should not be sent to the Company Announcements Office.

A response is requested as soon as possible and, in any event, not later than half an hour before the start of trading (i.e. before 7.30 a.m. WST) on Tuesday, 23 August 2011 .

Under listing rule 18.7A, a copy of this query and your response will be released to the market, so your response should be in a form suitable for release and should separately address each of the questions asked. If you have any queries or concerns, please contact me immediately.

Yours sincerely

[Sent electronically without signature]

Sebastian Bednarczyk Adviser, Listings (Perth)