XREF LIMITED — Capital/Financing Update 2012

Aug 30, 2012

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King Solomon Mines Limited

ARBN 122 404 666 83 Fisher Parade Sunny Hills, Auckland 2010, New Zealand Office (within Australia): 1 800 061 569 (outside Australia): +64 4 905 9608 Fax: +64 6 364 8497 enquiries@kingsolomonmines.com www.kingsolomonmines.com

31 August 2012

Companies Announcements Office Australian Securities Exchange

ISSUE OF SHARES UNDER PLACEMENT

Attached is an Appendix 3B for the issue of 30,913,452 fully paid ordinary shares at a price of $0.0165 to raise $510,072 to clients of Dayton Way Financial Pty Limited and other qualified sophisticated investors as announced to ASX on 29 August 2012.

Secondary Trading Exemption

The Act restricts the on-sale of securities issued without disclosure, unless the sale is exempt under section 708 or 708A. By the Company giving this notice, a sale of the Securities noted above will fall within the exemption in section 708A(5) of the Act.

The Company hereby notifies ASX under paragraph 708A(5)(e) of the Act that:

• a) the Company issued the Securities without disclosure to investors under Part 6D.2 of the Act; b) as at 31 August 2012 the Company has complied with the provisions of Chapter 2M of the Act as they apply to the Company, and section 674 of the Act; and

• c) as at 31 August 2012 there is no information:

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

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

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

    • B) the rights and liabilities attaching to the Securities.

King Solomon Mines Limited

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Stephen McPhail Managing Director

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

Name of entity

King Solomon Mines Limited

ARBN

122 404 666

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)	Ordinary fully paid shares
	30,913,452 ordinary shares
	Ordinary fully paid shares issued under placement, as explained in the attached announcement.

• See chapter 19 for defined terms.

Appendix 3B Page 2

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Appendix 3B New issue announcement

4 Do the[+] securities rank equally Yes, shares rank equally with existing in all respects from the date of quoted shares. 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 1.65 cents per share

6 Purpose of the issue Refer attached. The funds raised are for (If issued as consideration for general working capital purposes, the acquisition of assets, clearly mainly in connection with exploring the identify those assets) company’s exploration licences in Inner Mongolia.

Questions 6 to 6i

Not applicable

7 Dates of entering +securities 31 August 2012 into uncertificated holdings or despatch of certificates

Number +Class 8 Number and +class of all 166,287,552 Fully Paid Ordinary Shares +securities quoted on ASX + ( including the securities in 30,913,452 section 2 if applicable)

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

9 Number and +class of all +securities not quoted on ASX (including the securities in section 2 if applicable)	Number	+Class
	3,100,000 + 500,000 + 2,900,000	29 July 2014 Options – exercise price 10 cents 25 March 2016 Options – exercise price 12 cents 29 July 2016 Options – exercise price 12 cents

10 Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests)

Full participation in any future dividends.

Part 2 - Bonus issue or pro rata issue

Questions 11 to 33

Not applicable

Part 3 - Quotation of securities

You need only complete this section if you are applying for quotation of securities

Type of securities 34 (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.

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Appendix 3B New issue announcement

Entities that have ticked box 34(b)

Questions 38 to 42

Not applicable

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: 31 August 2012 (Managing Director)

Print name: Stephen McPhail

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• See chapter 19 for defined terms.

Appendix 3B Page 5

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