RED MOUNTAIN MINING LIMITED — Capital/Financing Update 2013

May 15, 2013

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 01/07/96 Origin: Appendix 5 Amended 01/07/98, 01/09/99, 01/07/00, 30/09/01, 11/03/02, 01/01/03, 24/10/05, 01/08/12

Name of entity

Red Mountain Mining Limited

ABN

119 568 106

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 tobe issued	Fully Paid Ordinary SharesListed Options
2	Number of +securities issued or tobe issued (if known) or maximumnumber which may be issued	Up to 281,358,039 Fully Paid Ordinary SharesUp to 140,679,020 Listed Options exercisable at$0.015 each on or before 30 June 2014Up to 97,839,510Listed Optionsexercisable at$0.03 each on or before 30 June 2016
3	Principal terms of the +securities(eg, if options, exercise price andexpirydate;ifpartlypaid+securities, the amount outstandingand due dates for payment; if+convertiblesecurities,theconversion price and dates forconversion)	Fully Paid Ordinary SharesListed Options exercisable at $0.015 each on orbefore 30 June 2014.Listed Options exercisable at $0.03each on orbefore 30 June 2016.

+ See chapter 19 for defined terms.

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 $0.01 per Share.

Yes.

Listed Options: The Listed Options form two new classes of securities. Options over unissued shares may only be exercised in accordance with their terms and conditions.

Upon conversion of the Options to shares, the shares will rank equally with existing shares.

Listed Options: Nil

6 Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets)

Up to 281,358,039 Shares, up to 140,679,020 free attaching Listed Options exercisable at $0.015 each on or before 30 June 2014 and up to 70,339,510 free attaching Listed Options exercisable at $0.03 each on or before 30 June 2016 to be issued pursuant to a partially and conditionally underwritten, pro-rata, renounceable rights issue to raise approximately $2,813,580 (before costs) to be applied, with existing funds and after meeting the expenses of the entitlement issue, towards drilling high-grade gold targets at Lobo and Archangel prospects to seek to increase and upgrade Mineral Resources at Batangas Gold Project, undertake a preliminary scoping study into a profitable gold project development at Batangas Gold Project, and general working capital.

27,500,000 Listed Options to be issued to Patersons Securities Limited or its nominees in consideration for underwriting services provided in relation to the rights issue.

6a Is the entity an +eligible entity that has obtained security holder approval under rule 7.1A? Yes.

If Yes, complete sections 6b – 6h in relation to the +securities the subject of this Appendix 3B, and comply with section 6i

6b The date the security holder resolution under rule 7.1A was passed

27 November 2012.

	7.1A
6e	Number of +securities issued withsecurity holder approval under rule7.3, or another specific securityholder approval (specify date ofmeeting)	27,500,000 Listed Options to be issued toPatersons Securities Limited or its nominees inconsideration for underwriting services provided inrelation to the rights issue.
6f	Number of securities issued underan exception in rule 7.2	Up to 281,358,039 Shares, up to 140,679,020 freeattaching Listed Options exercisable at $0.015 eachon or before 30 June 2014 and up to 70,339,510 freeattaching Listed Options exercisable at $0.03 eachon or before 30 June 2016
6g	Ifsecuritiesissuedunderrule7.1A, was issue price at least 75%of 15 day VWAP as calculatedunder rule 7.1A.3?Include theissuedateandbothvalues.Include the source of the VWAPcalculation.	N/A
6h	If securities were issued under rule7.1A for non-cash consideration,state date on which valuation ofconsideration was released to ASXMarket Announcements	N/A
6i	Calculate the entity's remainingissue capacity under rule 7.1 andrule 7.1A – complete Annexure 1andreleasetoASXMarketAnnouncements	7.1: 70,339,510 securities.7.1A: 46,893,007 securities.

None.

7 Dates of entering +securities into uncertificated holdings or despatch of certificates

6c Number of +securities issued without security holder approval

6d Number of +securities issued with security holder approval under rule

under rule 7.1

On or around 26 June 2013

None. The Company intends to seek shareholder approval prior to the issue of those Listed Options to be issued to Patersons Securities Limited or its nominees in consideration for underwriting services

provided in relation to the rights issue.

+ See chapter 19 for defined terms.

8 Number and +class of all +securities quoted on ASX (including the securities in section 2 if applicable)

Number	+Class
Up to 354,416,914	Fullypaidordinaryshares.
Up to 140,679,020	ListedOptionsexercisableat$0.015each on or before 30June 2014.
Up to 97,839,510	ListedOptionsexercisable at $0.03 eachon or before 30 June2016.

		Number	+Class
9	+classNumberandofall+securities not quoted on ASX(including the securities in section2 if applicable)	114,513,15111. 14,513,151 Sharesescrowed to 1 September2013; 100,000,000Shares escrowed to 30October 2013.	Fullypaidordinaryshares
		50,000,00022. Escrowed for 12months upon conversionto fully paid ordinaryshares.	PerformanceShares(conversionsubjecttoperformancebasedconditions).
		27,728,12533. 18,428,125 Optionsescrowed to 1 September2013.	Options exercisable at 20cents each on or before30 June 2014.
		1,718,43344. Escrowed until 1September 2013.	Options exercisable at 20cents each on or before12 September 2013.
		15,000,000	Options exercisable at 20cents on or before 15September 2016.
		Note: 13,840,916 unlistedOptions were cancelled on 13May 2013, comprising:2,000,000 Options exercisableat 25 cents each on or before 1July 2014;2,000,000 Options exercisableat 50 cents on or before 1 July2016;4,420,458 Options exercisableat 25 cents each on or before31 July 2014;4,420,458 Options exercisableat 35 cents each on or before31 July 2016; and1,000,000 Options exercisableat 20 cents on or before 30October 2017.

10 Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests)

Not applicable

Part 2 - Bonus issue or pro rata issue

+ See chapter 19 for defined terms.

11	Issecurityholderapprovalrequired?	No
12	Is the issue renounceable or nonrenounceable?	Renounceable
13	Ratio in which the +securities willbe offered	Three New Shares for every two Shares held at theRecord Date with one free attaching Listed Optionexercisable at $0.015 each on or before 30 June2014 for every two New Shares subscribed for andone free attaching Listed Option exercisable at$0.03 each on or before 30 June 2016 for every fourNew Shares subscribed for.
14	+Class of +securities to which the	Ordinary Shares
	offer relates	Listed Options exercisable at $0.015 each onor before 30 June 2014.
		Listed Options exercisable at $0.03 each on orbefore 30 June 2016.
15	+Recorddatetodetermineentitlements	27 May 2013
16	Will holdings on different registers(or subregisters) be aggregated forcalculating entitlements?	No
17	Policy for deciding entitlements inrelation to fractions	Round down
18	Names of countries in which theentity has +security holders whowillnotbesentnewissuedocuments	All countries outside of Australia, NewZealand and Canada
	Note: Security holders must be told how theirentitlements are to be dealt with.
	Cross reference: rule 7.7.
19	Closingdateforreceiptofacceptances or renunciations	17 June 2013

20	Names of any underwriters	Patersons Securities Limited
21	Amount of any underwriting fee orcommission	The fees payable to the Broker (exclusive ofGST) in relation to the rights issue are:•$60,000 corporate advisory fee payableupon completion of the Offer;•$35,750 underwriting fee (being 6.5% ofthe Underwritten Amount) payable uponcompletion of the Offer;•27,500,000 Underwriter Options; and•6.5%oftheamountofShortfallSecuritiesbeyondtheUnderwrittenAmount that is placed and which ispayable upon completion of the Offer.
22	Names of any brokers to the issue	Patersons Securities Limited.
23	Fee or commission payable to thebroker to the issue	As noted in 21 above.
24	Amountofanyhandlingfeepayabletobrokerswholodgeacceptances or renunciations onbehalf of +security holders	N/A
25	Iftheissueiscontingenton+security holders' approval, the dateof the meeting	N/A
26	Date entitlement and acceptanceform and prospectus or ProductDisclosure Statement will be sent topersons entitled	31 May 2013
27	If the entity has issued options, andthe terms entitle option holders toparticipate on exercise, the date onwhich notices will be sent to optionholders	16 May 2013
28	Date rights trading will begin (ifapplicable)	21 May 2013
29	Date rights trading will end (ifapplicable)	7 June 2013
30	How do +security holders sell theirentitlementsinfullthroughabroker?	Providing instructions to their broker, in accordancewith section 4.2 of the Prospectus lodged on 16May 2013.

+ See chapter 19 for defined terms.

How do +security holders sell partoftheirentitlementsthroughabroker and accept for the balance?	Providing instructions to their broker, in accordancewith section 4.2 of the Prospectus lodged on 16May 2013.
How do +security holders disposeof their entitlements (except by salethrough a broker)?	Providing instructions to their broker, in accordancewith section 4.2 of the Prospectus lodged on 16May 2013, for those entitlements they wish to selland completing and submitting Entitlement andAcceptance form with cleared funds or completinga BPAY payment, in accordance with section 4.3 ofthe Prospectus lodged on 16 May 2013, for thebalance.
+Despatch date	26 June 2013

Part 3 - Quotation of securities

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

34	(tick one)	Type of securities
(a)		Securities described in Part 1
(b)		All other securitiesExample: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employeeincentive 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 are +equity securities, a distribution schedule of the additional +securities setting out the number of holders in the categories 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.

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
• 42 Number and +class of all +securities quoted on ASX (including the securities in clause 38)

Number	+Class

other security)

• See chapter 19 for defined terms.

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.
• 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.

Sign here: Date: 16 May 2013

(Company Secretary)

Print name: SHANNON COATES

== == == == ==

+ See chapter 19 for defined terms.

Appendix 3B – Annexure 1

Calculation of placement capacity under rule 7.1 and rule 7.1A for +eligible entities

Introduced 01/08/12

Part 1

Rule 7.1 –Issues exceeding 15% of capital
Step 1: Calculate "A", the base figure from which the placementcapacity is calculated
Insert number of fully paid ordinarysecurities on issue 12 months before dateof issue or agreement to issue	79,060,026
Add the following:
•Number of fully paid ordinary securitiesissued in that 12 month period under anexception in rule 7.2	281,358,039 Shares to be issued on oraround 26/06/2013
•Number of fully paid ordinary securities	100,000,000 Shares issued 30/10/2012
issued in that 12 month period withshareholder approval	8,412,000 Shares issued 02/01/2013
•Number of partly paid ordinarysecurities that became fully paid in that12 month period	100,000 Shares issued 07/01/2013
Note:	= 389,870,039 Shares
•Include only ordinary securities here –other classes of equity securities cannotbe added•Include here (if applicable) the securitiesthe subject of the Appendix 3B to whichthis form is annexed•It may be useful to set out issues ofsecurities on different dates as separateline items
Subtract the number of fully paid ordinarysecurities cancelled during that 12 monthperiod	0
"A"	468,930,065

+ See chapter 19 for defined terms.

Step 2: Calculate 15% of "A"
"B"	0.15
	[Note: this value cannot be changed]
Multiply "A" by 0.15	70,339,510
Step 3: Calculate "C", the amount of placement capacity under rule 7.1that has already been used
Insert number of equity securities issued oragreed to be issued in that 12 month periodnot counting those issued:	0
•Under an exception in rule 7.2
•Under rule 7.1A
•With security holder approval under rule7.1 or rule 7.4
Note:•This applies to equity securities, unlessspecifically excluded – not just ordinarysecurities•Include here (if applicable ) thesecurities the subject of the Appendix3B to which this form is annexed•It may be useful to set out issues ofsecurities on different dates as separateline items
"C"	0
Step 4: Subtract "C" from ["A" x "B"] to calculate remainingplacement capacity under rule 7.1
"A" x 0.15	70,339,510
Note: number must be same as shown inStep 2
Subtract "C"	0
Note: number must be same as shown inStep 3
Total ["A" x 0.15] – "C"	70,339,510
	[Note: this is the remaining placementcapacity under rule 7.1]

+ See chapter 19 for defined terms.

Part 2

Rule 7.1A –Additional placement capacity for eligible entities
Step 1: Calculate "A", the base figure from which the placementcapacity is calculated
"A"Note: number must be same as shown inStep 1 of Part 1	468,930,065
Step 2: Calculate 10% of "A"
"D"	0.10Note: this value cannot be changed
Multiply "A" by 0.10	46,893,007
Step 3: Calculate "E", the amount of placement capacity under rule7.1A that has already been used
Insert number of equity securities issued oragreed to be issued in that 12 month periodunder rule 7.1ANotes:•This applies to equity securities – notjust ordinary securities•Include here – if applicable – thesecurities the subject of the Appendix3B to which this form is annexed•Do not include equity securities issuedunder rule 7.1 (they must be dealt within Part 1), or for which specific securityholder approval has been obtained•It may be useful to set out issues ofsecurities on different dates as separateline items	0
"E"	0

+ See chapter 19 for defined terms.

Step 4: Subtract "E" from ["A" x "D"] to calculate remainingplacement capacity under rule 7.1A
"A" x 0.10Note: number must be same as shown inStep 2	46,893,007
Subtract "E"Note: number must be same as shown inStep 3	0
Total ["A" x 0.10] – "E"	46,893,007Note: this is the remaining placementcapacity under rule 7.1A

+ See chapter 19 for defined terms.