REDSTONE RESOURCES LIMITED — Capital/Financing Update 2017

Aug 6, 2017

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7 Au g ust 2017

The M anager Com p any Annou n cements O f fice Aust r alian Stock E xchange Li m ited Level 4, Exchang e Centre 20 B r idge Street SYD N EY NSW, 2000

Elect r onic Lodge m ent

Dear Sir/Madam

EXPIRY OF LISTED OPTIONS (ASX: RDSOA)

Reds t one Resou r ces Limite d ( ASX: RDS )(“ Redstone ” or “ the Company ”) gives notic e that 137, 0 16 fully pa i d ordinary s hares in th e Company have today been issue d pursuant t o the conv e rsion of 13 7 ,016 listed R DSOA Opti o ns (“ Options ”).

The r emaining u n exercised 5 5 ,494,177 O p tions expir e d on 31 Jul y 2017.

An A p pendix 3B a ccompanie s this notice.

Regards

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Mira n da Conti Com p any Secret a ry RED S TONE RESO U RCES LIMI T ED

Redstone Resources Limited ABN 42 0 9 0 169 154 60 Havelock Street, Wes t Perth WA 60 0 5 Tel: 08 9328 2552 Fax: 08 9328 2660

www.redstone.com.au Email: conta c t@redstone.c o m.au

1

Appendix 3B New issue announcement

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, 04/03/13

Name of entity

Redstone Resources Ltd

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 1. Fully paid ordinary shares; be issued 2. N/A – Expiry of Listed Options 2 Number of[+] securities issued or 1. 137,016 fully paid ordinary shares to be issued (if known) or 2. N/A ‐ Expiry of 55,494,177 RDSOA maximum number which may Options be issued 3 Principal terms of the 1. per existing fully paid ordinary +securities (e.g. if options, shares on issue exercise price and expiry date; if 2. N/A partly paid +securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)

• See chapter 19 for defined terms.

Appendix 3B Page 1

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Appendix 3B New issue announcement

4 Do the+securities rank equally in all respects from the+issue date 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 6 Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets) 6a Is the entity an+eligible entity that has obtained security holder approval under rule 7.1A? 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 6c Number of+securities issued without security holder approval under rule 7.1	1. Yes 2. N/A
	1. $0.03/share 2. N/A
	1. Exercise of listed RDSOA Options 2. N/A
	Yes
	29 November 2016
	Nil

• See chapter 19 for defined terms.

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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 +Issue dates Note: The issue date may be prescribed by ASX (refer to the definition of issue date in rule 19.12). For example, the issue date for a pro rata entitlement issue must comply with the applicable timetable in Appendix 7A. Cross reference: item 33 of Appendix 3B. 8 Number and +class of all +securities quoted on ASX (_including_the +securities in section 2 if applicable)	Nil
	Nil
	137,016
	N/A
	N/A
	See Annexure 1
	7 August 2017
	Number	+Class
	379,934,261	Fully paid ordinary Shares
	Number	+Class

• See chapter 19 for defined terms.

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9 Number and +class of all +securities not quoted on ASX (_including_the +securities in section 2 if applicable)	2,000,000 10,000,000 10,000,000	Unquoted options exercisable at $0.20 on or before 4 December 2017 Unquoted $0.015 options exercisable at $0.015 on or before 28 February 2020 Unquoted $0.02 options exercisable at $0.02 on or before 28 February 2020

10 Dividend policy (in the case of a The Company currently has no dividend trust, distribution policy) on the policy increased capital (interests)

Part 2 - Pro rata issue

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11 Is security holder approval
required?
12 Is the issue renounceable or non‐
renounceable?
13 Ratio in which the [+] securities
will be offered
14 +Class of +securities to which the
offer relates
15 +Record date to determine
entitlements
16 Will holdings on different
registers (or subregisters) be
aggregated for calculating
entitlements?
17 Policy for deciding entitlements
in relation to fractions
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• See chapter 19 for defined terms.

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18	Names of countries in which the
	entity has security holders who
	will not be sent new offer
	documents
	Note: Security holders must be told how their
	entitlements are to be dealt with.
	Cross reference: rule 7.7.
19	Closing date for receipt of
	acceptances or renunciations
20	Names of any underwriters
21	Amount of any underwriting fee
	or commission
22	Names of any brokers to the
	issue
23	Fee or commission payable to
	the broker to the issue
24	Amount of any handling fee
	payable to brokers who lodge
	acceptances or renunciations on
	behalf of security holders
25	If the issue is contingent on
	security holders’ approval, the
	date of the meeting
26	Date entitlement and acceptance
	form and offer documents will be
	sent to persons entitled
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
28	Date rights trading will begin (if
	applicable)
29	Date rights trading will end (if
	applicable)

• See chapter 19 for defined terms.

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30 How do security holders sell their entitlements in full through a broker? 31 How do security holders sell part of their entitlements through a broker and accept for the balance? 32 How do security holders dispose of their entitlements (except by sale through a broker)? 33 +Issue date

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 ‐ 137,016 Fully paid ordinary shares

• (b) All other[+] securities

Example: 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 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 – Refer pages 1‐2 of Annexure 2

• 36 If the[+] securities are[+] equity securities, a distribution schedule of the additional +securities setting out the number of holders in the categories – Refer page 3 of Annexure 2

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.

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Appendix 3B New issue announcement

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[+] issue date 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 other[+] security) Number +Class 42 Number and +class of all +securities quoted on ASX ( including the[+] securities in clause 38)

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

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 is not available now, we 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.

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Sign here: ................................... Date: 7 August 2017............. (Company secretary)

Print name: Miranda Conti...........................................................

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• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

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 placement capacity is calculated

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Insert number of fully paid ordinary 326,047,245
securities on issue 12 months before date
of issue or agreement to issue
Add the following:
• Number of fully paid ordinary securities 7/08/17 - 137,016
issued in that 12 month period under an
exception in rule 7.2
• Number of fully paid ordinary securities
issued in that 12 month period with 28/02/17 - 53,750,000
shareholder approval
• Number of partly paid ordinary
Nil
securities that became fully paid in that
12 month period
Note:
• Include only ordinary securities here –
other classes of equity securities cannot
be added
• Include here (if applicable) the securities
the subject of the Appendix 3B to which
this form is annexed
• It may be useful to set out issues of
securities on different dates as separate
line items
Subtract the number of fully paid ordinary Nil
securities cancelled during that 12 month
period
“A” 379,934,261
Step 2: Calculate 15% of “A”
“B” 0.15
[Note: this value cannot be changed]
Multiply “A” by 0.15 56,990,139
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• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Step 3: Calculate “C”, the amount of placement capacity under rule 7.1 that has already been used

Appendix 3B New issue announcement	Appendix 3B New issue announcement
Step 3: Calculate “C”, the amount of placement capacity under rule 7.1 that has already been used
Insertnumber of equity securities issued or agreed to be issued in that 12 month period not counting_those issued: • Under an exception in rule 7.2 • Under rule 7.1A • With security holder approval under rule 7.1 or rule 7.4 _Note: • This applies to equity securities, unless specifically excluded – not just ordinary securities • Include here (if applicable ) the securities the subject of the Appendix 3B to which this form is annexed • It may be useful to set out issues of securities on different dates as separate line items	Nil
“C”	Nil
Step 4: Subtract “C” from [“A” x “B”] to calculate remaining placement capacity under rule 7.1
“A” x 0.15 Note: number must be same as shown in Step 2	56,990,139
Subtract“C” Note: number must be same as shown in Step 3	Nil
Total[“A” x 0.15] – “C”	56,990,139 [Note: this is the remaining placement capacity under rule 7.1]

Part 2

Rule 7.1A – Additional placement capacity for eligible entities

Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

capacity is calculated
“A”	326,047,245
Note: number must be same as shown in
Step 1 of Part 1
Step 2: Calculate 10% of “A”

• See chapter 19 for defined terms.

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“D”	0.10 Note: this value cannot be changed
Multiply“A” by 0.10	32,604,725
Step 3: Calculate “E”, the amount of placement capacity under rule 7.1A that has already been used
Insertnumber of equity securities issued or agreed to be issued in that 12 month period under rule 7.1A Notes: • This applies to equity securities – not just ordinary securities • Include here – if applicable – the securities the subject of the Appendix 3B to which this form is annexed • Do not include equity securities issued under rule 7.1 (they must be dealt with in Part 1), or for which specific security holder approval has been obtained • It may be useful to set out issues of securities on different dates as separate line items	Nil
“E”	Nil
Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A
“A” x 0.10 Note: number must be same as shown in Step 2	32,604,725
Subtract“E” Note: number must be same as shown in Step 3	Nil
Total[“A” x 0.10] – “E”	32,604,725 Note: this is the remaining placement capacity under rule 7.1A

• See chapter 19 for defined terms.

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