REDSTONE RESOURCES LIMITED — Capital/Financing Update 2013

Jan 13, 2013

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

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

Redstone Resources Limited

ABN

42 090 169 154

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 to be issued

Unquoted Options*

4,359,334 Options*

• 2 Number of +securities issued or to be issued (if known) or maximum number which may be issued
• 3 Principal terms of the +securities (eg, if options, exercise price and expiry date; if partly paid +securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)

Options are exercisable at $0.20 on or before 28 February 2016.

*The Options are unquoted however application for quotation of these Options will be made at a later date in accordance with the requirements of the ASX Listing Rules and subject to the Corporations Act.

+ See chapter 19 for defined terms.

4	Do the +securities rank equally	No
	in all respects from the date ofallotment with an existing +classof quoted +securities?
	If the additional securities donot rank equally, please state:•the date from which they do•the extent to which theyparticipateforthenextdividend, (in the case of atrust,distribution)orinterest payment•the extent to which they donot rank equally, other thaninrelationtothenextdividend,distributionorinterest payment	The fully paid ordinary shares that will beissued upon exercise of the options will rankpari passu with the fully paid ordinaryshares on issue.
5	Issue price or consideration	$0.01/option
6	Purpose of the issue(If issued as consideration forthe acquisition of assets, clearlyidentify those assets)	Underwritten shortfall allocation of pro-ratanon-renounceable entitlement issue of one(1) Listed Option for every ten (10) fully paidordinary shares.Funds raised are intended to be first appliedto the expenses of the offer and then usedfor ongoing exploration of the Company'sexisting projects.
6a	Is the entity an +eligible entitythathasobtainedsecurityholder approval under rule 7.1A?	Yes
	If Yes, complete sections 6b – 6hin relation to the +securities thesubject of this Appendix 3B, andcomply with section 6i
6b	The date the security holderresolution under rule 7.1A waspassed	29 November 2012
6c	Number of +securities issuedwithout security holder approvalunder rule 7.1	4,359,334

+ See chapter 19 for defined terms.

• 6d Number of +securities issued with security holder approval under rule 7.1A
• 6e Number of +securities issued with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting)
• 6f Number of securities issued under an exception in rule 7.2
• 6g If securities issued under rule 7.1A, was issue price at least 75% of 15 day VWAP as calculated under rule 7.1A.3? Include the issue date and both values. Include the source of the VWAP calculation.
• 6h If securities were issued under rule 7.1A for non-cash consideration, state date on which valuation of consideration was released to ASX Market Announcements
• 6i Calculate the entity's remaining issue capacity under rule 7.1 and rule 7.1A – complete Annexure 1 and release to ASX Market Announcements
• 7 Dates of entering +securities into uncertificated holdings or despatch of certificates
• 8 Number and +class of all +securities quoted on ASX (including the securities in section 2 if applicable)

		Number	+Class
8	+classNumberandofall+securitiesquotedonASX(includingthesecuritiesinsection 2 if applicable)	151,969,390	Ordinary Shares(RDS)
		9,997,605	Optionsexercisableat $0.20 any time onorbefore28February2016(RDSO)

N/A

N/A

N/A

N/A

N/A

Refer Annexure 1

14 January 2013

• See chapter 19 for defined terms.

		Number	+Class
9	+classNumberandofall	300,000 Unquoted	$0.75Options
	+securities not quoted on ASX	Options (RDSAA)	exercisable12
	(includingthesecuritiesin		monthsfrom20
	section 2 if applicable)
			February2008and
			expiring 20 February
			2013.
		1,500,000 Unquoted
		Options (RDSAK)	$0.25Options
			exercisable any time
			onorbefore30
			November 2014.
		500,000 Unquoted
		Options (RDSAK)	$0.30Options
			exercisable any time
			onorbefore30
			November 2014.
		500,000 Unquoted
		Options (RDSAK)	$0.35Options
			exercisable any time
			onorbefore30
			November 2014.
		3,750,000 Unquoted
		Options (RDSAO)	$0.50Options
			exercisable any time
			onorbefore19
			October 2013.
		650,000Unquoted
		Options (RDSAQ)	$0.50Options
			exercisable any time
			onorbefore4
			November 2013.
		500,000Unquoted
		Options (RDSAC)	$0.50Options
			exercisable any time
			onorbefore1
			December 2013.
		1,100,000Unquoted
		Options (RDSAY)
			$0.50Options
			exercisable any time
			onorbefore24
		750,000Unquoted	February 2014
		Options (RDSAS)
			$0.35unquoted
			optionsexercisable
			anytimeonor
			before 6 July 2015.

+ See chapter 19 for defined terms.

		500,000UnquotedOptions (RDSAS)	$0.45unquotedoptionsexercisableanytimeonorbefore 6 July 2015.
		550,000UnquotedOptions (RDSAS)	$0.35unquotedoptionsexercisableanytimeonorbefore 6 July 2015.
		1,000,000 UnquotedOptions (RDSAU)	$0.30unquotedoptionsexercisableanytimeonorbefore 21 December2014.
		1,000,000 UnquotedOptions (RDSAB)	$0.30unquotedoptionsexercisableanytimeonorbefore 26 February2015.
		14,359,361 Options*(RDSAW)	$0.20optionsexercisable any timeonorbefore28February 2016.
		2,000,000 UnquotedOptions	$0.20optionsexercisable any timeonorbefore3December 2017.
10	Dividend policy (in the case of atrust, distribution policy) on theincreased capital (interests)	N/A

Part 2 - Bonus issue or pro rata issue

11	Issecurityholderapprovalrequired?	N/A
12	Is the issue renounceable or nonrenounceable?	N/A
13	Ratio in which the +securitieswill be offered	N/A

+ See chapter 19 for defined terms.

Appendix 3B New issue announcement

14	+Class of +securities to which theoffer relates	N/A
15	+Recorddatetodetermineentitlements	N/A
16	Willholdingsondifferentregisters(orsubregisters)beaggregatedforcalculatingentitlements?	N/A
17	Policy for deciding entitlementsin relation to fractions	N/A
18	Names of countries in which theentity has +security holders whowillnotbesentnewissuedocumentsNote: Security holders must be told how theirentitlements are to be dealt with.Cross reference: rule 7.7.	N/A
19	Closingdateforreceiptofacceptances or renunciations	N/A
20	Names of any underwriters	N/A
21	Amount of any underwriting feeor commission	N/A
22	Names of any brokers to theissue	N/A
23	Fee or commission payable to thebroker to the issue	N/A
24	Amountofanyhandlingfeepayable to brokers who lodgeacceptances or renunciations onbehalf of +security holders	N/A
25	If the issue is contingent on+security holders' approval, thedate of the meeting	N/A

+ See chapter 19 for defined terms.

• 26 Date entitlement and acceptance form and prospectus or Product Disclosure Statement will be sent to persons entitled N/A
• 27 If the entity has issued options, and the terms entitle option holders to participate on exercise, the date on which notices will be sent to option holders

N/A

• 28 Date rights trading will begin (if applicable) N/A
• 29 Date rights trading will end (if applicable) N/A
• 30 How do +security holders sell their entitlements in full through a broker? N/A
• 31 How do +security holders sell part of their entitlements through a broker and accept for the balance?

N/A

32 How do +security holders dispose of their entitlements (except by sale through a broker)?

N/A

33 +Despatch date N/A

N/A

Part 3 - Quotation of securities

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

34	Type of securities(tick one)
(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,employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertiblesecurities

+ See chapter 19 for defined terms.

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 theadditional +securities, and the number and percentage of additional +securitiesheld 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 categories1 - 1,0001,001 - 5,0005,001 - 10,00010,001 - 100,000100,001 and over
37	A copy of any trust deed for the additional +securities

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

+ See chapter 19 for defined terms.

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 other security)

ion
$\operatorname{\textsf{end}}$
oftify

		Number	+Class
42	+classNumberandofall+securitiesquotedonASX(including the securities in clause38)

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.

+ See chapter 19 for defined terms.

• 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: 14 January 2013 (Company secretary)

Print name: Miranda Conti

== == == == ==

+ 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	129,969,390
Add the following:
•Number of fully paid ordinary securitiesissued in that 12 month period under anexception in rule 7.2	Nil
•Number of fully paid ordinary securities	10/10/12 - 11,600,000
issued in that 12 month period withshareholder approval	12/12/12 - 8,400,000
•Number of partly paid ordinary securitiesthat became fully paid in that 12 monthperiod	Nil
Note:•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	Nil
"A"	151,969,390

+ 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	22,795,409
Step 3: Calculate "C", the amount of placement capacity under rule7.1 that has already been used
Insert number of equity securities issued oragreed to be issued in that 12 month period	12/12/12 - 14
not counting those issued:	14/01/13 – 4,359,334
•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"	4,359,348
Step 4: Subtract "C" from ["A" x "B"] to calculate remainingplacement capacity under rule 7.1
"A" x 0.15	22,795,409
Note: number must be same as shown inStep 2
Subtract "C"	4,359,348
Note: number must be same as shown inStep 3
Total ["A" x 0.15] – "C"	18,436,061
	[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"	151,969,390
Note: number must be same as shown inStep 1 of Part 1
Step 2: Calculate 10% of "A"
"D"	0.10
	Note: this value cannot be changed
Multiply "A" by 0.10	15,196,939
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 7.1A	Nil
Notes:•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
"E"	Nil

+ See chapter 19 for defined terms.

Step 4: Subtract "E" from ["A" x "D"] to calculate remainingplacement capacity under rule 7.1A
"A" x 0.10	15,196,939
Note: number must be same as shown inStep 2
Subtract "E"	Nil
Note: number must be same as shown inStep 3
Total ["A" x 0.10] – "E"	15,196,939
	Note: this is the remaining placementcapacity under rule 7.1A

+ See chapter 19 for defined terms.