SILVER MINES LIMITED — Capital/Financing Update 2012

Jun 5, 2012

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Level 5 17-19 Bridge Street Sydney, NSW, 2065 P: +61 2 9253 0900 E: info@silverminesltd.com.au W: www.silverminesltd.com.au

ASX Limited Company Announcements Exchange Centre 20 Bridge Street Sydney NSW 2000

6 June 2012

Security Code: SVL

PLACEMENT, SECTION 708 (A) NOTICE & APPENDIX 3B

The Directors of Silver Mines Limited (‘the Company’) are pleased to announce a placement of 12,504,733 ordinary fully paid shares at 6 cents per share raising $750,284 (before costs) and 6,252,367 free attaching options to sophisticated and institutional investors (Placement Securities). The free attaching options have an exercise price of $0.10 expiring on 13 November 2013 (Placement Securities).

The funds raised will be applied towards exploration drilling programs at the Webbs Project in New England, Northern New South Wales and working capital.

Notice pursuant to section 708A(5)(e) of the Corporations Act 2001 (Cth)

In accordance with the requirements with the section 708A(5)(e) of the Corporations Act 2001 (Cth) (‘the Act’) under which this notice is given, the Company confirms that:

• 1 The Company issued the Placement Securities without disclosure to the investors under Part 6D.2 of the Act.

• 2 As at the date of this notice, the Company has complied with:

• 2.1 the provisions of Chapter 2M of the Act as they apply to the Company; and

• 2.2 section 674 of the Act.

• 3 As at the date of this notice, there is no information:

• (a) that has been excluded from a continuous disclosure notice in accordance with the ASX Listing Rules; and

• (b) that investors and their professional advisers would reasonably require for the purpose of making an informed assessment of:

  • (i) the assets and liabilities, financial position and performance, profits and losses and prospects of the Company; or

  • (ii) the rights and liabilities attaching to the ordinary shares of the Company,

to the extent to which it is reasonable for investors and their professional advisers to expect to find the information in a disclosure document.

Yours faithfully

Kevin Lynn - Company Secretary

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Silver Mines Limited ACN 107 452 942