PEPPERMINT INNOVATION LIMITED — Capital/Financing Update 2012

Aug 28, 2012

Churchill Court Unit 2, Level 1, 331 Hay Street Subiaco WA 6008 Ph: (08) 9380 4430 Fx: (08) 9481 5044 ABN 56 125 931 964

Dear Sir/Madam

UPDATED NOTICE UNDER SECTION 708AA(12) OF THE CORPORATIONS ACT 2001

On 9 August 2012, Chrysalis Resources Ltd (Company) provided a notice under section 708AA(2)(f) of the Corporations Act 2001 (Cth) (Corporations Act) as notionally modified by Australian Securities and Investment Commission Class Order 08/35 (C08/35) (Notice) in relation to the non-renounceable rights issue it undertook, as released on the Australian Securities Exchange on 8 August 2012 (Entitlement Offer). References in this notice of the Corporations Act are references to the Corporations Act as modified or amended by CO 08/35.

Subsequent to the release of this Notice, the Company has entered into a Subscription Agreement with Tiger Resources Limited (Tiger (Subscription Agreement). For further information on the Subscription Agreement please see the announcement the Company released on the Australian Securities Exchange on 28 August 2012.

As a result of the Company entering into the Subscription Agreement, there is a material change to the potential effect the issue of the relevant securities will have on the control of the Company and as such this updated Notice must be provided under section 708AA(12) of the Corporations Act.

Pursuant to the terms of the Subscription Agreement, Tiger:

• (a) will receive the shortfall under the Entitlement Offer (Shortfall) up to a maximum shareholding of 19.90%
• (b) has the right to appoint a nominee to the Board of the Company;
• (c) is entitled to appoint 2 representatives to a newly formed technical committee, which will also comprise 2 directors of the Company; and
• (d) will have the first right of refusal in relation to the sale of Chrysalis' assets.

As a result, there is a potential that Tiger will obtain control of the Company. Tiger is not a related party of the Company for the purposes of the Corporations Act.

The Company hereby confirms that for the purposes of this updated Notice, in respect of the Entitlement Offer (as per the requirements of paragraph 708AA(2)(f) of the Corporations Act):

• (a) the Company will offer the Shares for issue without disclosure to investors under Part 6D.2 of the Corporations Act;

• (b) the Company is providing this updated Notice under paragraphs 2(f) and 12(b) of section 708AA of the Corporations Act;

• (c) as at the date of this notice the Company has complied with:

  • (i) the provisions of Chapter 2M of the Corporations Act as they apply to the Company;
  • (ii) section 674 of the Corporations Act as it applies to the Company;

• (d) as at the date of this notice, there is no excluded information of the type referred to in sections 708AA(8) and 708AA(9) of the Corporations Act; and

• (e) it is not possible to determine the precise change in control that may occur as the level of each Shareholder's participation is not known at this stage, however the below table sets out various possibilities and is based on the assumption that no further shares are issued and no options are exercised. Under the terms of the Subscription Agreement, Tiger must subscribe for 19.90% of the shareholding in the Company. Tiger does not currently hold any shares in the Company.

Table 1 –				Effect on control of entering into the Subscription Agreement
-----------	--	--	--	---------------------------------------------------------------

ShareholderParticipation	Tiger Shareholding	Current Shareholders Shareholding
100	0.00%	100.00%
75	11.11%	88.89%
50	19.90%	80.10%
25	19.90%	80.10%
0	19.90%	80.10%

The dilutive effect on the Company's shareholders is not affected by the execution of the Subscription Agreement.

Yours sincerely

Melanie Cotterell Company Secretary