TREK METALS LIMITED — Capital/Financing Update 2012

Aug 19, 2012

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ZAMBEZI RESOURCES LIMITED ARBN: 124 462 826 BERMUDA ZAMBIA AUSTRALIA CANON’S COURT PLOT 5697 LEVEL 1, 17 ORD STREET 22 VICTORIA STREET BEU CRESCENT WEST PERTH, WESTERN AUSTRALIA HAMILTON HM12 KALUNDU AUSTRALIA 6005 LUSAKA TEL: +61 8 6555 1879 TEL: +260 211 292101 FAX: +61 8 9398 4104 EMAIL: INFO@ZAMBEZIRESOURCES.COM PO BOX 1796, WEST PERTH WWW.ZAMBEZIRESOURCES.COM WESTERN AUSTRALIA, 6872

ASX Announcement Monday, 20 August 2012

Zambezi announces its funding strategy to advance the Kangaluwi Copper Project

Zambezi Resources Limited (ASX: ZRL) (“ Zambezi” or “ the Company” ) is pleased to announce its funding strategy towards the advancement of its 100% owned Kangaluwi Copper Project (“ Project” ) in Zambia.

The Company will proceed with a Non-Renounceable Rights Issue of AUD $4.47 million together with a 9 month AUD $1.5 million Bridging Facility ( “Facility” ) to advance its Kangaluwi Copper Project program.

Given the potential size of the Project, the Board has decided to seek participation from major international mining houses towards the financing of the Project. To this end, the Company has executed a number of Confidentiality Agreements.

On 25 July 2011 the Company announced that it had entered into an AUD $10 million two trances (AUD $5 million each) convertible note facility with the LinQ Resources Fund ( “LRF” ). The first tranche of AUD $5 million has been drawn down and the Company is still to drawdown the second AUD $5 million tranche on completion of a feasibility study for the Project. Drawdown of the AUD $1.5 million funds from the fully secured Facility will attract a 12% per annum facility coupon and is secured pari pasu with the convertible notes.

Rights Issue

The Company is seeking to raise A$4.47 million (before costs) to be applied towards working capital, debt servicing and a continued drilling program together with further extensive metallurgical test work. The objective of these programs is to advance the feasibility study work of the proposed Oxide Copper Project, which is Stage 1 of the overall Project mine development plan.

Under the proposed Rights Issue, eligible shareholders will be invited to subscribe for 2 new ordinary Zambezi shares for every 3 existing shares held on the record date at a price of 0.4 cents per share.

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If there is any shortfall under the Rights Issue, the directors reserve the right to place the shortfall.

The major shareholder being the LinQ Resources Fund intends to take up its full entitlement under the Rights Issue.

The current proposed timetable for the Rights Issue is set out below. These dates are indicative only and Zambezi reserves the right to vary the dates for any reason (subject to the Corporations Act and the Listing Rules).

Event Date Announcement of Entitlement Offer 20 August 2012 Shareholders trade on ‘ex’ entitlement basis 22 August 2012 Record date for determining entitlements to participate in 5.00pm (Perth time) Entitlement Offer 28 August 2012 Entitlement Offer booklet dispatched to shareholders 3 September 2012 Entitlement Offer opens 3 September 2012 Entitlement Offer closes 17 September 2012 Allotment of New Shares under Entitlement Offer and dispatch of 25 September 2012 holding statements Normal trading for new shares commences 26 September 2012

Zambezi Resources Limited Frank Vanspeybroeck CEO Tel: 6555 1879

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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 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

Zambezi Resources Limited

ARBN

124 462 826

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)	Fully paid ordinary shares
	Approximately 1,118,708,875 fully paid ordinary shares pursuant to a rights issue announced on 20 August 2012 (“Rights Issue”)
	Fully paid ordinary shares issued for cash consideration

• See chapter 19 for defined terms.

24/10/2005 Appendix 3B Page 1

Appendix 3B New issue announcement

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)	Yes – the shares to be issued under the Rights Issue will rank equally in all respects with the existing ordinary shares on issue	Yes – the shares to be issued under the Rights Issue will rank equally in all respects with the existing ordinary shares on issue
	0.4 cent per share
	The funds raised under the Rights Issue will be used towards working capital, debt servicing and a continued drilling program, together with further extensive metallurgical test work. The objective of these programs is to advance the feasibility study work of the Oxide Copper Project, which is Stage 1 of the overall Project mine development plan.
	25 September 2012
	Number	+Class
	After the Rights Issue, 2,796,772,188 (based on the number of fully paid ordinary shares on issue as at the date of this Appendix 3B and the maximum number of fully paid ordinary shares to be issued under the Rights Issue, subject to the effects of rounding)	Fully paid ordinary shares

• See chapter 19 for defined terms.

24/10/2005

Appendix 3B Page 2

Appendix 3B New issue announcement

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
	99,500,000 5,000,000 30,000,000 10,000,000 10,000,000 2,500,000 2,000,000 2,000,000 2,000,000 2,500,000	A$0.01 options exp. 30/11/12 A$0.02 options exp. 05/05/13 A$0.02 options exp. 31/05/13 A$0.025 options exp. 30/09/13 A$0.03 options exp. 30/09/13 A$0.04 options exp. 01/06/13 A$0.03 options exp. 11/01/13 A$0.04 options exp. 11/01/14 A$0.05 options exp. 11/01/14 A$0.01 options exp. 30/06/14
	N/A

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? 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.	No
	Non-renounceable 2 fully paid ordinary shares for every 3 existing fully paid ordinary shares held on the record date
	Fully paid ordinary shares
	28 August 2012
	No
	Entitlements in relation to fractions of shares will be rounded up to the next whole share
	Shareholders in countries other than Australia and New Zealand will not be eligible to participate.

• See chapter 19 for defined terms.

Appendix 3B Page 3

1/1/2003

Appendix 3B New issue announcement

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?	17 September 2012
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	Dispatch to be completed by 3 September 2012
	20 August 2012
	N/A
	N/A
	N/A
	N/A

• See chapter 19 for defined terms.

Appendix 3B Page 4

1/1/2003

Appendix 3B New issue announcement

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

N/A

• 33 +Despatch date

25 September 2012

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.

Appendix 3B Page 5

1/1/2003

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 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 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.

Appendix 3B Page 6

1/1/2003

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 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: 20 August 2012 (Chief Financial Officer)

Print name: Pierre Malherbe == == == == ==

• See chapter 19 for defined terms.

24/10/2005 Appendix 3B Page 7