IODM LIMITED — Capital/Financing Update 2012

May 28, 2012

==> picture [296 x 44] intentionally omitted <==

==> picture [296 x 43] intentionally omitted <==

29 May 2012

Company Announcements Office Australian Securities Exchange, Level 4, Exchange Centre, 20 Bridge Street, SYDNEY NSW 2000

Dear Sir/Madam

Share Purchase Plan

Paradigm Metals Limited (“PDM” or “the Company”) announces a Share Purchase Plan (“SPP”) under which shareholders with registered addresses in Australia or New Zealand as of the Record Date (28 May 2012) are entitled to subscribe for up to $4,400 worth of PDM shares at 0.55 cents per share.

The purpose of the SPP is to raise working capital for PDM, primarily to fund the next round of exploration work at the Yellow Mountain Gold Project in central western New South Wales and to continue assessment of new opportunities.

In the last 4 months, PDM has done considerable work to re-evaluate the results of its exploration activities at the Yellow Mountain Gold Project over the last 2 years and has reassessed the work of prior explorers, particularly in the Yellow Mountain Mine area. A comprehensive review of this information is now available on the Yellow Mountain page on the PDM website.

Recent work in the Yellow Mountain Mine area has highlighted polymetallic mineralisation that may host an open pittable oxide gold resource#. The Directors believe that even modest additional exploration expenditure has the potential to generate encouraging results which can add significant shareholder value. The Company is currently cutting and re-assaying old drill core from the Yellow Mountain Mine area to assess the grade of gold and silver in drill cores that were not previously sampled for gold. This work is low-cost, and will highlight those parts of the prospect that have the best potential to host an economic resource.

The Melrose prospect, which is part of the Yellow Mountain Gold Project, has a magnetic anomaly of a similar size and amplitude to the Cadia-Ridgeway magnetic anomaly. The Directors believe this anomaly is perhaps one of the best undrilled porphyry targets in New South Wales in a region of the Lachlan Fold Belt that contains a number of large Cu/Au porphyry mines.

This is conceptual in nature as there has been insufficient exploration to define a Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource.

Paradigm Metals Ltd ABN 28 102 747 133 Suite 202, 122 Walker Street, North Sydney, AUSTRALIA 2060 Ph: +61 (2) 9955-7130 Fax: +61 (2) 8920-3576 E-mail: info@paradigmmetals.com.au

The Company has earned a 30% interest in Exploration Licence 6325 (122 km[2] ) (known as Yellow Mountain) and has the right to earn an additional 21% interest by spending $450,000 before 31 March 2013. Paradigm has already spent $400,000 on exploration at EL 6325 since September 2010. PDM also holds 100% of the adjacent Exploration Licence EL7697.

The Company has a record of minimising overhead costs and maximising expenditure on exploration and the Directors are confident that the comparatively modest maximum amount to be raised by the SPP ($245,654) can be used to telling effect.

The PDM share price has recently fallen to historic lows and the opportunity arises through the SPP for shareholders to now acquire significant numbers of additional shares at minimal cost without brokerage fees or stamp duty. Shareholders can subscribe up to a maximum of $4,400 which will purchase 800,000 shares. There is no minimum subscription and shareholders can apply for any number of shares up to the maximum of $4,400.

There are some 1,061 PDM shareholders eligible to participate in the SPP and the Company is entitled under the ASX Listing Rules to issue up to 44, 664,447 shares under the SPP (30% of its existing capital being 148,881,492 shares), If applications are received in excess of this limit, then applications will be scaled back pro rata and excess applications moneys will be promptly returned to applicants without interest. The Directors decision on the scale back is final.

The application price of 0.55 cents per share represents a 16.67% discount to the average ASX closing sale price over the last 5 days on which PDM shares have been traded immediately before this announcement. Participating shareholders should be aware of the risk that the market price for PDM shares may change between the date of the offer and the date when the securities are issued under the SPP.

The timetable for the SPP is as follows

The timetable for the SPP is as follows
SPP Record Date	28 May2012 (7.00pm Sydneytime)
Despatch of SPP offers	30 May2012
SPP OpeningDate	30 May2012
SPP ClosingDate	15 June 2012 (5.00pm Sydneytime)
Despatch date for holding statements	21 June 2012
Quotation of shares on ASX	21 June 2012

All the Directors intend to take up their $4,400 entitlements under the SPP.

Yours faithfully,

==> picture [104 x 42] intentionally omitted <==

Stephen Lonergan Company Secretary

The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Mr Greg Curnow who is a Member of the Australasian Institute of Mining and Metallurgy. Mr Curnow is the Chief Executive Officer of the Company, and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Curnow consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.