SILVER MINES LIMITED — Director's Dealing 2012

Jul 8, 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

9 July 2012

To: Company Announcement officer

LAPSE OF SILVER MINES LIMITED 6 JULY2012 UNLISTED OPTIONS

Silver Mines Limited (ASX Code: SVL) advises that 3,500,000 unlisted options, exercisable at $0.20 and expiring 6 July 2012 have lapsed.

Quoted Securities Number & class of all securities quoted on ASX:

Number Class

148,611,201 Fully Paid Ordinary Shares. 13,609,882 Options, listed, exercise price 35 cents, expiring 31 October 2012.

Unquoted Securities

Number & class of all securities not quoted on ASX:

Number

Class

6,252,376 Unlisted Options, exercise price 10 cents, expiry 13 November 2013. 2,000,000 Unlisted Options, exercise price 24 cents, expiry 27 August 2012. 2,000,000 Unlisted Options, exercise price 40 cents, expiry 27 August 2013. 8,500,000 Unlisted Employee Options, exercise price 50 cents, expiry 23 December 2015. 3,000,000 Performance Rights

Attached Appendix 3B and Appendix 3Y’s (x3).

Yours sincerely

Kevin Lynn Company Secretary

Page 1 of 1

Silver Mines Limited ACN 107 452 942

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 1/7/96. Origin: Appendix 5. Amended 1/7/98, 1/9/99, 1/7/2000, 30/9/2001, 11/3/2002, 1/1/2003, 24/10/2005.

Name of entity

Silver Mines Limited

ACN

107 452 942

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
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)

• See chapter 19 for defined terms.

24/10/2005 Appendix 3B Page 1

• 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

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

• 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 clause 2 if applicable)

Number +Class 148,611,201 Fully Paid Ordinary Shares 13,609,882 Options, listed, exercise price 35 cents, expiring 31 October 2012

9 Number and +class of all +securities not quoted on ASX (_including_the securities in clause 2 if applicable) 10 Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests)	Number	+Class
	6,252,376 2,000,000 2,000,000 8,500,000 3,000,000	Unlisted Options, exercise price 10 cents, Expiry 13 November 2012 Unlisted Options, exercise price 24 cents, Expiry 27 August 2012. Vest 27 February 2011 Unlisted Options, exercise price 40 cents, Expiry 27 August 2013. Vest – 27 August 2011 Unlisted Employee Options, exercise price 50 cents, Expiry Date 23 December 2015 Performance Rights
	Unchanged

Part 2 - Bonus issue or pro rata issue

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?	N/A
	N/A
	N/A
	N/A
	N/A
	N/A

• See chapter 19 for defined terms.

24/10/2005 Appendix 3B Page 3

17 Policy for deciding entitlements in relation to fractions 18 Names of countries in which the entity has+security holders who will not be sent new issue 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 prospectus or Product Disclosure Statement 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) 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?	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A

• 32 How do[+] security holders dispose N/A of their entitlements (except by sale through a broker)?

• 33 +Despatch date

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 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

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.

24/10/2005 Appendix 3B Page 5

Entities that have ticked box 34(b)

• 38 Number of securities for which N/A +quotation is sought

• 39 Class of +securities for which quotation is sought N/A

• 40 Do the[+] securities rank equally in all N/A 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

• N/A

Example: In the case of restricted securities, end of restriction period

(if issued upon conversion of another security, clearly identify that other security)

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

Number	+Class
N/A	N/A

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: 9 July 2012 ( ~~Director/~~ Company Secretary) Print name: Kevin Martin Lynn == == == == ==

• See chapter 19 for defined terms.

24/10/2005 Appendix 3B Page 7

Appendix 3Y Change of Director’s Interest Notice

Rule 3.19A.2

Appendix 3Y

Change of Director’s Interest Notice

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 30/09/01 Amended 01/01/11

Name of entity Silver Mines Limited ACN 107 452 942

We (the entity) give ASX the following information under listing rule 3.19A.2 and as agent for the director for the purposes of section 205G of the Corporations Act.

Name of Director	David Sutton
Date of last notice	10 June 2011

Part 1 - Change of director’s relevant interests in securities

In the case of a trust, this includes interests in the trust made available by the responsible entity of the trust

Note: In the case of a company, interests which come within paragraph (i) of the definition of “notifiable interest of a director” should be disclosed in this part.

Direct or indirect interest	Indirect / Direct
Nature of indirect interest (including registered holder) Note: Provide details of the circumstances giving rise to the relevant interest.	Karela Giselle Pty Ltd Optex Exchange Pty Ltd HH Sutton Nominees Pty Ltd David Sutton
Date of change	6 July 2012
No. of securities held prior to change	2,268,114 Ordinary Shares, 500,000 Unlisted Employee Options exercisable at 20 cents, expiring 6 July 2012, 2,000,000 director options exercisable at 50 cents, 1,000,000 Performance Rights
Class
Number acquired
Number disposed	500,000 unlisted options
Value/Consideration Note: If consideration is non-cash, provide details and estimated valuation	Nil

• See chapter 19 for defined terms.

01/01/2011 Appendix 3Y Page 1

Appendix 3Y Change of Director’s Interest Notice

No. of securities held after change	2,268,114 Ordinary Shares, 2,000,000 director options exercisable at 50 cents, 1,000,000 Performance Rights
Nature of change Example: on-market trade, off-market trade, exercise of options, issue of securities under dividend reinvestment plan, participation in buy-back	Lapse of Options

Part 2 – Change of director’s interests in contracts

Note: In the case of a company, interests which come within paragraph (ii) of the definition of “notifiable interest of a director” should be disclosed in this part.

Detail of contract	N/A
Nature of interest	N/A
Name of registered holder (if issued securities)	N/A
Date of change	N/A
No. and class of securities to which interest related prior to change Note: Details are only required for a contract in relation to which the interest has changed	N/A
Interest acquired	N/A
Interest disposed	N/A
Value/Consideration Note: If consideration is non-cash, provide details and an estimated valuation	N/A
Interest after change	N/A

Part 3 –[+] Closed period

Were the interests in the securities or contracts detailed No above traded during a[+] closed period where prior written clearance was required? If so, was prior written clearance provided to allow the trade N/A to proceed during this period? If prior written clearance was provided, on what date was this N/A provided?

• See chapter 19 for defined terms.

Appendix 3Y Page 2

01/01/2011

Appendix 3Y Change of Director’s Interest Notice

Rule 3.19A.2

Appendix 3Y

Change of Director’s Interest Notice

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 30/09/01 Amended 01/01/11

Name of entity Silver Mines Limited ACN 107 452 942

We (the entity) give ASX the following information under listing rule 3.19A.2 and as agent for the director for the purposes of section 205G of the Corporations Act.

Name of Director	Malcolm Bird
Date of last notice	10 June 2011

Part 1 - Change of director’s relevant interests in securities

In the case of a trust, this includes interests in the trust made available by the responsible entity of the trust

Note: In the case of a company, interests which come within paragraph (i) of the definition of “notifiable interest of a director” should be disclosed in this part.

Direct or indirect interest	(1) Indirect (2) Direct
Nature of indirect interest (including registered holder) Note: Provide details of the circumstances giving rise to the relevant interest.	(1) Malcolm Bird trustee for Malcolm Bird Super Fund (2) Malcolm Bird
Date of change	6 July 2012
No. of securities held prior to change	(1) 538,350 - Ordinary fully paid shares (2) 93,500 Ordinary fully paid shares (2) 500,000 Unlisted Employee Options exercisable at 20 cents, expiring 6 July 2012 (2)2,000,000 director options exercisable at 50 cents, (2)1,000,000PerformanceRights
Class
Number acquired
Number disposed	500,000 unlisted options
Value/Consideration Note: If consideration is non-cash, provide details and estimated valuation	Nil

• See chapter 19 for defined terms.

01/01/2011 Appendix 3Y Page 1

Appendix 3Y Change of Director’s Interest Notice

No. of securities held after change	1 538,350 - Ordinary fully paid shares 2 93,500 Ordinary fully paid shares 2 2,000,000 director options exercisable at 50 cents, 2 1,000,000 Performance Rights
Nature of change Example: on-market trade, off-market trade, exercise of options, issue of securities under dividend reinvestment plan, participation in buy-back	Lapse of Options

Part 2 – Change of director’s interests in contracts

Note: In the case of a company, interests which come within paragraph (ii) of the definition of “notifiable interest of a director” should be disclosed in this part.

Detail of contract	N/A
Nature of interest	N/A
Name of registered holder (if issued securities)	N/A
Date of change	N/A
No. and class of securities to which interest related prior to change Note: Details are only required for a contract in relation to which the interest has changed	N/A
Interest acquired	N/A
Interest disposed	N/A
Value/Consideration Note: If consideration is non-cash, provide details and an estimated valuation	N/A
Interest after change	N/A

Part 3 –[+] Closed period

Were the interests in the securities or contracts detailed above traded during a+closed period where prior written clearance was required?	No
If so, was prior written clearance provided to allow the trade to proceed during this period?	N/A
If prior written clearance was provided, on what date was this provided?	N/A

• See chapter 19 for defined terms.

Appendix 3Y Page 2

01/01/2011

Appendix 3Y Change of Director’s Interest Notice

Rule 3.19A.2

Appendix 3Y

Change of Director’s Interest Notice

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 30/09/01 Amended 01/01/11

Name of entity Silver Mines Limited ACN 107 452 942

We (the entity) give ASX the following information under listing rule 3.19A.2 and as agent for the director for the purposes of section 205G of the Corporations Act.

Name of Director	Charles Straw
Date of last notice	10 June 2011

Part 1 - Change of director’s relevant interests in securities

In the case of a trust, this includes interests in the trust made available by the responsible entity of the trust

Note: In the case of a company, interests which come within paragraph (i) of the definition of “notifiable interest of a director” should be disclosed in this part.

Direct or indirect interest	Direct / Indirect
Nature of indirect interest (including registered holder) Note: Provide details of the circumstances giving rise to the relevant interest.	(1) DAVCHA HOLDINGS PTY LTD (2) Charles Straw
Date of change	6 July 2012
No. of securities held prior to change	563,532 Ordinary Shares, 500,000 Unlisted Employee Options exercisable at 20 cents, expiring 6 July 2012 , 165,000 ordinary shares, 2,000,000 director options exercisable at 50 cents,1,000,000PerformanceRights
Class
Number acquired
Number disposed	500,000 unlisted options
Value/Consideration Note: If consideration is non-cash, provide details and estimated valuation	Nil
No. of securities held after change	563,532 Ordinary Shares, 165,000 ordinary shares, 2,000,000 director options exercisable at 50 cents, 1,000,000 Performance Rights

• See chapter 19 for defined terms.

01/01/2011 Appendix 3Y Page 1

Appendix 3Y Change of Director’s Interest Notice

Nature of change Lapse of Options Example: on-market trade, off-market trade, exercise of options, issue of securities under dividend reinvestment plan, participation in buy-back

Part 2 – Change of director’s interests in contracts

Note: In the case of a company, interests which come within paragraph (ii) of the definition of “notifiable interest of a director” should be disclosed in this part.

Detail of contract	N/A
Nature of interest	N/A
Name of registered holder (if issued securities)	N/A
Date of change	N/A
No. and class of securities to which interest related prior to change Note: Details are only required for a contract in relation to which the interest has changed	N/A
Interest acquired	N/A
Interest disposed	N/A
Value/Consideration Note: If consideration is non-cash, provide details and an estimated valuation	N/A
Interest after change	N/A

Part 3 –[+] Closed period

Part 3 –+Closed period
Were the interests in the securities or contracts detailed above traded during a+closed period where prior written clearance was required?	No
If so, was prior written clearance provided to allow the trade to proceed during this period?	N/A
If prior written clearance was provided, on what date was this provided?	N/A

• See chapter 19 for defined terms.

Appendix 3Y Page 2

01/01/2011