VERITY RESOURCES LIMITED — Capital/Financing Update 2012

Jan 31, 2012

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TO: COMPANY ANNOUNCEMENTS OFFICE ASX LIMITED

Market Cap

DATE: 1 FEBRUARY 2012

Cash

BML TO RAISE $1.9M:

NON-RENOUNCEABLE RIGHTS ISSUE & APPENDIX 3B

Botswana Metals Limited (BML) announced a rights issue to raise up to $1.9m underwritten for a minimum amount of $1m by Bell Potter Securities Limited. The funds will be used to continue exploration at BML’s three discovery areas at Airstrip Copper, Maibele North and Dibete. The funds will also be used to test additional new targets identified as VTEM anomalies to the East at Takane (PL54/98) and cash for general working capital requirements over the next 12 months.

Details are as follows.

Issued Capital

Substantial shareholders

Directors

The Board of Botswana Metals Limited (“the Company”) announces a non-renouceable rights issue to eligible shareholders on the following terms (“Rights Issue”):

• One (1) new ordinary fully paid share (“New Share”) for every three (3) shares held at the Record Date, at an issue price of four cents ($0.04) per new share.

• For every one New Share subscribed, one (1) option exercisable at 10 cents ($0.10) each at any time up to 5pm AEST on 30 June 2013 (“Expiry Date”) will be issued to the subscriber at nil cost.

Registered Office

• The Rights Issue is expected to raise approximately $1.9M before expenses.

• Bell Potter Securities is the Lead Manager and underwriter to the Rights Issue which is underwritten to a minimum of $1 million.

• The New Shares will rank pari passu with the existing issued shares of the Company.

Contact

• The funds raised will be used to continue exploration on our three discovery areas in Botswana, at Airstrip Copper, Maibele North and Dibete and to test additional new targets particularly several VTEM anomalies to the East at Takane (PL54/98) over the next 12 months. The exploration will be designed with the objective of adding to our current resource inventory and to seek additional targets with the potential for mineralisation within our Botswana portfolio.

An Appendix 3B in relation to the Rights Issue is attached.

Pat Volpe Chairman

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

BOTSWANA METALS LIMITED

ABN

96 122 995 073

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. ORDINARY SHARES be issued 2. OPTIONS EXPIRING 30 JUNE 2013 (“ATTACHING OPTIONS”)

• 2 Number of[+] securities issued or 1. 47,905,948 ORDINARY SHARES to be issued (if known) or 2. 47,905,948 ATTACHING OPTIONS maximum number which may be issued

• 3 Principal terms of the[+] securities 1. FULLY PAID ORDINARY SHARES (eg, if options, exercise price and 2. ATTACHING OPTIONS expiry date; if partly paid EXERCISABLE AT 10 CENTS +securities, the amount ($0.10) EXPIRING 30 JUNE 2013 outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)

• See chapter 19 for defined terms.

24/10/2005Appendix 3B Page 1

Appendix 3B New issue announcement

4 Do the[+] securities rank equally in 1. ORDINARY SHARES WILL RANK all respects from the date of EQUALLY WITH ORDINARY allotment with an existing[+] class SHARES ALREADY ON ISSUE. of quoted[+] securities? 2. ATTACHING OPTIONS – UPON EXERCISE THE SHARES WILL If the additional securities do not RANK EQUALLY WITH rank equally, please state: ORDINARY SHARES ALREADY  the date from which they do ON ISSUE.  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 1. SHARES – 4 CENTS ($0.04) 2. ATTACHING OPTIONS – NIL CONSIDERATION 6 Purpose of the issue RIGHTS ISSUE – FUNDS RAISED BY (If issued as consideration for the THE ISSUE WILL BE USED PRIMARILY acquisition of assets, clearly TO ADVANCE EXPLORATION identify those assets) ACTIVITIES IN BOTSWANA AND FOR COMPANY ADMINISTRATION. 7 Dates of entering +securities 12 MARCH 2012 into uncertificated holdings or despatch of certificates Number +Class 8 Number and +class of all 191,623,792 ORDINARY SHARES +securities quoted on ASX ( including the securities in 119,763,618 ATTACHING clause 2 if applicable) OPTIONS

• See chapter 19 for defined terms.

Appendix 3B Page 2

24/10/2005

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
	N/A	N/A
	THE COMPANY DOES NOT YET HAVE A DIVIDEND POLICY. PAYMENT OF FUTURE DIVIDENDS WILL DEPEND UPON THE FUTURE PROFITABILITY AND FINANCIAL POSITION OF THE COMPANY.

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	NO
	NON-RENOUNCEABLE
	ONE NEW SHARE FOR EVERY THREE SHARES HELD ON THE RECORD DATE PLUS ONE ATTACHING OPTION FOR EACH NEW SHARESUBSCRIBED.
	ORDINARY SHARES AND ATTACHING OPTIONS
	13 FEBRUARY 2012
	YES
	ENTITLEMENTS WILL BE ROUNDED DOWN TO NEAREST SHARE.

• See chapter 19 for defined terms.

Appendix 3B Page 3

1/1/2003

Appendix 3B New issue announcement

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	ALL COUNTRIES IN WHICH THE ENTITY HAS SECURITY HOLDERS EXCEPT AUSTRALIA AND NEW ZEALAND.
	2 MARCH 2012
	BELL POTTER SECURITIES
	5% COMMISSION ON UNDERWRITTEN AMOUNT. 1% MANAGEMENT FEE ON TOTAL ISSUE.
	BELL POTTER SECURITIES
	N/A
	16 FEBRUARY 2012
	1 FEBRUARY 2012
	N/A
	N/A

• See chapter 19 for defined terms.

Appendix 3B Page 4

1/1/2003

Appendix 3B New issue announcement

applicable)

• 30 How do +security holders sell N/A 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

• See chapter 19 for defined terms.

Appendix 3B Page 5

1/1/2003

Appendix 3B New issue announcement

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

32 How do[[+]] security holders dispose N/A of their entitlements (except by sale through a broker)? 33 +Despatch date 12 MARCH 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) X 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 6

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 7

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: .. 1 FEBRUARY 2012 .. (Company secretary)

Print name: ............. RICHARD BAKER ..............

• See chapter 19 for defined terms.

Appendix 3B Page 8

1/1/2003