PEPPERMINT INNOVATION LIMITED — Capital/Financing Update 2012

Aug 8, 2012

CHRYSALIS RESOURCES LTD NON-RENOUNCEABLE RIGHTS RENOUNCEABLE RIGHTS RENOUNCEABLE RIGHTS ISSUE –LETTER TO LETTER TO OPTIONHOLDERS HOLDERS

9th August 2012

Market Announcements Platform Australian Securities Exchange

CHRYSALIS RESOURCES LIMITED

NON-RENOUNCEABLE RIGHTS ISSUE – LETTER TO OPTION HOLDERS

Please find attached a copy of the letter which has been sent to the Company's option holders today advising details of the Company's Rights Issue.

Dr Neale Fong Executive Chairman

Mel Cotterell Company Secretary

Chrysalis Resources Limited	Company Snapshot		Company Structure		Board Management
A.B.N 56 125 931 964Level 1	Listed on ASX	27 May 2008	No of Shares on Issue	75,343,702	Dr Neale FongExecutive Chairman
331 Hay StreetSUBIACO WA 6008	ASX Share Code	CYS	No of Options on Issue	35,036,327	Mr Grant Kidner
PO Box 226, Wembley WA 6913	Sector	Mining	Cash (as at 30th June 12)	$0.29M	Executive Director
Phone: 618 9380 4430					Mr Adrian PaulNon-Executive Director
Fax: 618 9481 5044E: info@chrysalisresources.com.au					Mel Cotterell
www.chrysalisresources.com.au					Company Secretary

CHRYSALIS RESOURCES LTD NON-RENOUNCEABLE RIGHTS RENOUNCEABLE RIGHTS ISSUE –NOTICE TO NOTICE OPTIONHOLDERS

9 th August 2012

Dear Optionholder

4:5 NON RENOUNCEABLE RIGHTS ISSUE OFFER

As announced on 8 August 2012, Chrysalis Resources Limited ("Chrysalis") (ASX: CYS) is undertaking a 4:5 non-renounceable rights issue of ordinary shares. This issue will raise approximately $3.013 million (Rights Issue). A copy of the Company's announcement which contains details of the Rights Issue is attached.

This notice is sent to you as a holder of options to acquire ordinary shares in Chrysalis.

The terms and conditions of the options you currently hold do not entitle you to participate in the Rights Issue unless you exercise your options in time for new shares to be allotted and to be entered on the Company's register of members on or before 5.00pm on 20 August 2012 (Record Date).

To exercise your options and thereby participate in the Rights Issue, you will need to deliver the following to the Company at PO Box 226, Wembley WA 6913.

• (a) A notice of exercise of options (attached to this letter) and;
• (b) Payment for the exercise price in respect of those options to be exercised by way of a cheque made payable to "Chrysalis Resources Limited – Trust Account".

To ensure that your new shares are allotted prior to the Record Date, the above must be received by no later than 5.00pm on 15 August 2012**.** If received after this date, allotment of new shares prior to the Record Date cannot be assured.

Before deciding whether to exercise any or all of your options, you should read the Offer in its entirety.

Chrysalis Resources Limited	Company Snapshot		Company Structure		Board Management
A.B.N 56 125 931 964Level 1	Listed on ASX	27 May 2008	No of Shares on Issue	75,343,702	Dr Neale FongExecutive Chairman
331 Hay StreetSUBIACO WA 6008	ASX Share Code	CYS	No of Options on Issue	35,036,327	Mr Grant Kidner
PO Box 226, Wembley WA 6913	Sector	Mining	Cash (as at 30th June 2012) $0.29M		Executive Director
Phone: 618 9380 4430					Mr Adrian PaulNon-Executive Director
Fax: 618 9481 5044E: info@chrysalisresources.com.auwww.chrysalisresources.com.au					Mel CotterellCompany Secretary

This notice is important and requires immediate attention. If you have any queries concerning the Rights Issue, please contact your financial adviser or Chrysalis's Company Secretary on (08) 9380 3802.

Dr Neale Fong Executive Chairman

Mel Cotterell Company Secretary

Chrysalis Resources Limited	Company Snapshot		Company Structure		Board Management
A.B.N 56 125 931 964Level 1	Listed on ASX	27 May 2008	No of Shares on Issue	75,343,702	Dr Neale FongExecutive Chairman
331 Hay StreetSUBIACO WA 6008	ASX Share Code	CYS	No of Options on Issue	35,036,327	Mr Grant Kidner
PO Box 226, Wembley WA 6913	Sector	Mining	Cash (as at 30th June 12)	$0.29M	Executive Director
Phone: 618 9380 4430Fax: 618 9481 5044					Mr Adrian PaulNon-Executive Director
E: info@chrysalisresources.com.auwww.chrysalisresources.com.au					Mel CotterellCompany Secretary

Application Form on Exercise of Options Expiring 30 June 2013

To the Directors, Chrysalis Resources Limited,
I/We hereby exercise	option(s) and hand you herewith my/our cheque for	$
being 20 cents per share on application for		ordinary shares in the capital of the Company.
Company, and I/we authorise you to place my/our name on the register.	I/We request that you allot me that number of shares and I/we agree to accept that number of shares on the terms below and the Constitution of the
My/Our SRN/HIN (as shown on my/our Issuer Sponsored holding statement or CHESSholdings statement) is
I/We authorise you to act in accordance with my/our instructions set out above.	Sign Here – This section must be signed for your instructions to be executed
Individual or Securityholder 1	Securityholder 2	Securityholder 3
Director	Director/Company Secretary	Sole Director andSole Company Secretary
Note: when signed under Power of Attorney, the attorney states that they have not received anotice of revocation. Computershare Investor Services Pty Limited needs to sight a certifiedcopy of the Power of Attorney.		Day/DateMonthYear
		//
	Terms and Conditions of Options Expiring 30 June 2013

• (b) The Options will expire at 5:00 pm WST on 30 June 2013 (Expiry Date). Any Option not exercised before the Expiry Date will automatically lapse on the Expiry Date.
• (c) The amount payable upon exercise of each Option will be $0.20 (Exercise Price).
• (d) The Options held by each Option holder may be exercised in whole or in part, and if exercised in part, multiples of 1,000 must be exercised on each occasion.
• (e) An Option holder may exercise their Options by lodging with the Company, before the Expiry Date:
  • (i) a written notice of exercise of Options specifying the number of Options being exercised; and
  • (ii) a cheque or electronic funds transfer for the Exercise Price for the number of Options being exercised,

(Exercise Notice).

• (f) An Exercise Notice is only effective when the Company has received the full amount of the Exercise Price in cleared funds.
• (g) Within 10 Business Days of receipt of the Exercise Notice accompanied by the Exercise Price, the Company will allot the number of Shares required under these terms and conditions in respect of the number of Options specified in the Exercise Notice.
• (h) The Company will apply for quotation of the Options on ASX.
• (i) All Shares allotted upon the exercise of Options will upon allotment rank pari passu in all respects with other Shares.
• (j) The Company will apply for quotation of all Shares allotted pursuant to the exercise of Options on ASX within 10 Business Days after the date of allotment of those Shares.
• (k) If at any time the issued capital of the Company is reconstructed, all rights of an Option holder are to be changed in a manner consistent with the Corporations Act and the ASX Listing Rules at the time of the reconstruction.
• (l) There are no participating rights or entitlements inherent in the Options and Option holders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the Options. However, the Company will ensure that for the purposes of determining entitlements to any such issue, the record date will be at least 6 Business Days after the issue is announced. This will give Option holders the opportunity to exercise their Options prior to the date for determining entitlements to participate in any such issue.
• (m) An Option does not confer the right to a change in exercise price or a change in the number of underlying securities over which the Option can be exercised.

LODGEMENT INSTRUCTIONS

Cheques shall be in Australian currency made payable to Chrysalis Resources Limited and crossed "Not Negotiable". The application for shares on exercise of the options with the appropriate remittance should be lodged at the Company's Registered Post Office Box, Chrysalis Resources Limited – Trust Account, PO Box 226, Wembley WA 6913

CHRYSALIS RESOURCES LTD NON-RENOUNCEABLE RIGHTS RENOUNCEABLE RIGHTS RENOUNCEABLE ISSUE

8 th August 2012

Chrysalis Resources Limited ("Chrysalis") wishes to announce it will undertake a four (4) for five (5) non-renounceable pro-rata rights issue of ordinary shares at 5 cents per share ("Rights Issue") to shareholders to raise approximately $3.013 million.

Funds raised from the issue will be applied to:

CHRYSALIS RESOURCES LIMITED

• Conduct exploration programs on the newly acquired Zambian Copper Project
• Settle the acquisition of the Zambian Copper Project
• Repayment of an unsecured loan for $500,000 drawn to fund exploration on the Zambian Copper Project and general working capital
• Carry out further exploration programs at Pioneer and West Angelas
• Fund the costs associated with the Offer; and
• Fund general working capital

Chrysalis' two major shareholders Mr Adrian Paul (Director) and Mr David Nasir Yusoff together representing 15.54% of the issued capital of the Company have indicated that they intend to subscribe for their full entitlement under the Rights Issue. The other directors, Mr Grant Kidner and Dr Neale Fong, have also agreed to take up their full entitlements which represent 9.86% of the Company's issued capital.

Overview of Rights Issue

Eligible Chrysalis shareholders will be entitled to subscribe for four (4) new Chrysalis fully paid ordinary shares for every five (5) existing Chrysalis ordinary shares held at 5.00pm on 20 August 2012, at a price of 5 cents per share. The offer price of 5 cents per share represents a 33.33% discount to the closing price of Chrysalis ordinary shares on 30th July 2012 (the last date of trading in Chrysalis ordinary shares prior to announcement of the Rights Issue). All new ordinary shares issued will rank equally with existing ordinary Chrysalis shares.

Chrysalis Resources Limited	Company Snapshot		Company Structure		Board Management
A.B.N 56 125 931 964Level 1331 Hay Street	Listed on ASXASX Share Code	27 May 2008CYS	No of Shares on IssueNo of Options on Issue	75,343,70235,036,327	Dr Neale FongExecutive Chairman
SUBIACO WA 6008PO Box 226, Wembley WA 6913	Sector	Mining	Cash (as at 30th June 2012) $0.29M		Mr Grant KidnerExecutive Director
Phone: 618 9380 4430Fax: 618 9481 5044					Mr Adrian PaulNon-Executive Director
E: info@chrysalisresources.com.auwww.chrysalisresources.com.au					Mel CotterellCompany Secretary

If shareholders do not wish to take up any part of their entitlement they are not required to do so. The part of a shareholders entitlement not taken up will form part of the shortfall. The shortfall will be placed at the discretion of the directors.

The Rights Issue is non-renounceable and entitlements will not be tradeable on the ASX or otherwise transferable. Chrysalis shareholders who do not take up their entitlements in full will not receive any value for those entitlements that they do not take up.

An Offer document setting out the terms of the Rights Issue will be lodged with ASX on 9 August 2012. Eligible shareholders will also be sent a copy of the Offer document and application form on 24 August 2012.

Overseas holders

The offer of shares under the Rights Issue is limited to eligible shareholders with registered addresses in Australia and New Zealand. With the exception of New Zealand shareholders, overseas shareholders will not be offered new shares.

Important dates

Event	Date
Announcement of Rights Issue and lodgment of Appendix 3B	8 August 2012
The latest of release of Offer Document and Cleansing Statement toASX	9 August 2012
Notice sent to Security Holders	10 August 2012
Ex Date(date from which securities commence trading without theentitlement to participate in the Rights Issue)	14 August 2012
Record Date(date for determining entitlements of eligible shareholders toparticipate in the Rights Issue)	20 August 2012
Offer Document Despatched to Shareholders(expected date of dispatch of offer document, entitlement andacceptance forms)	24 August 2012
Company announces that the Offer Document has been dispatched	24 August 2012
Entitlement Issue opens	24 August 2012
Closing Date*5pm (WST)	7 September 2012
Securities quoted on a deferred settlement basis **	10 September 2012
Company to notify ASX of under subscriptions (if any) **	12 September 2012
Despatch holding statements **	17 September 2012

Chrysalis Resources Limited	Company Snapshot		Company Structure	Board Management
A.B.N 56 125 931 964Level 1	Listed on ASX	27 May 2008	No of Shares on Issue	75,343,702	Dr Neale FongExecutive Chairman
331 Hay Street	ASX Share Code	CYS	No of Options on Issue	35,036,327	Mr Grant Kidner
SUBIACO WA 6008	Sector	Mining	Cash (as at 30th June 12)	$0.29M	Executive Director
PO Box 226, Wembley WA 6913					Mr Adrian Paul
Phone: 618 9380 4430Fax: 618 9481 5044					Non-Executive Director
E: info@chrysalisresources.com.au					Mel Cotterell
www.chrysalisresources.com.au					Company Secretary

* Subject to the ASX Listing Rules, the Directors reserve the right to extend the Closing Date of the Rights Issue at their discretion. Should this occur, the extension will have a consequential effect on the anticipated date of issue for the new shares.

** These dates are indicative only and are subject to change. Chrysalis reserves the right to amend this indicative timetable without notice

Dr Neale Fong Executive Chairman

Mel Cotterell Company Secretary

Chrysalis Resources Limited	Company Snapshot		Company Structure	Board Management
A.B.N 56 125 931 964Level 1	Listed on ASX	27 May 2008	No of Shares on Issue	75,343,702	Dr Neale FongExecutive Chairman
331 Hay StreetSUBIACO WA 6008	ASX Share Code	CYS	No of Options on Issue	35,036,327	Mr Grant Kidner
PO Box 226, Wembley WA 6913	Sector	Mining	Cash (as at 30th June 12)	$0.29M	Executive Director
Phone: 618 9380 4430					Mr Adrian PaulNon-Executive Director
Fax: 618 9481 5044
E: info@chrysalisresources.com.auwww.chrysalisresources.com.au					Mel CotterellCompany Secretary