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1 NEW CORNERSTONE INVESTOR UNDERPINS TANZANIAN STRATEGY Highlights Strategic Relatinship and Subscriptin Agreement ( SRSA ) signed with Develping Market - fcussed private equity fund grup, Temb Capital ( Temb ), by which Temb will becme a significant sharehlder. Under the SRSA, Temb will crnerstne a funding package cmprising: Up-frnt firm investment f $2.3 millin by way f placement f rdinary shares at an issue price f 0.7c per share (a 17% premium t the last clsing price f Strandline shares); and A fully underwritten pr-rata renunceable rights issue t all eligible Strandline sharehlders t raise up t $4.3 millin at 0.5c per share. The aggregate cash injectin f apprximately $6.6 millin ( Initial Funding ) will ensure that Strandline is fully funded t advance its prtfli f high value Tanzanian mineral sands prjects ver the next tw years. Strategic, lng term relatinship with Temb includes: Appintment f Jhn Hdder f Temb as a nn-executive Directr f Strandline; Access t Temb s strategic & financing netwrks within Emerging Markets; and Ptential access t future develpment funding f up t a further $US15m ver the medium t lnger term. The Initial Funding and Temb s lng term cmmitment gives Strandline the capacity t: Fast track develpment f the high grade Fungni depsit; Undertake extensinal drilling and feasibility studies f the high grade Resurces at Tajiri; and Cntinue explratin and discvery drilling acrss Strandline s high value Tanzanian mineral sands prtfli. Page 1

2 Tanzanian fcussed mineral sands develper, Strandline Resurces Limited ( Strandline, STA, r the Cmpany ) is pleased t annunce the executin f a Strategic Relatinship and Subscriptin Agreement ( SRSA ) with Temb, the mining-fcussed private equity fund grup that specialises in investment int Develping Cuntries and has a strng track recrd f identifying and supprting emerging resurce cmpanies. Pursuant t the SRSA and utilising authrities available under ASX Listing Rule 7.1 and 7.1A, the Cmpany has reslved t undertake a placement t Temb f 332,943,363 new Ordinary Strandline shares at 0.7c each (being a 17% premium t the last market price f 0.6c), resulting in the receipt by the Cmpany f apprximately $2.3 millin in equity funding ( Placement ). Fllwing the cmpletin f the Placement, the Cmpany will undertake a fully underwritten pr-rata renunceable rights issue ffered t all eligible sharehlders ( Rights Issue ) t raise up t a further $4.3 millin at 0.5c per share. Details f the Rights Issue are cntained belw. Strandline s Managing Directr, Tm Eadie, said, The Bard f Strandline is delighted t welcme Temb as a supprtive majr sharehlder, which als has the capacity t prvide valuable technical and strategic supprt. Temb s investment and nging supprt strngly endrses the high ptential f Strandline s mineral sands prjects and ur highly capable team. The Cmpany is very excited abut having the financial capacity t prgress these high ptential prjects in the manner that they deserve. We encurage all eligible sharehlders t cnsider participatin in the Rights Issue. Fllwing its cmpletin, Strandline will be well funded fr significant activity ver the cming 24 mnths t unlck the value f ur Tanzanian prtfli. Initial Funding Strandline is undertaking the Placement and Rights Issue t financially psitin the Cmpany t unlck the value frm its Tanzanian Mineral Sands prtfli. The $6.6 millin raised frm the Initial Funding (befre expenses) will be used t prgress Strandline s mineral sands prperties in Tanzania, including: 1. Mving twards develpment at the 100% wned, zircn-rich Fungni depsit (see ASX Release 23 February 2016). 2. Extending high-grade, rutile-rich mineralisatin at Tajiri where nly 5 kilmetres f the 20 kilmetre trend has been drilled, already utlining tw Indicated Resurces, the best f which is 19 millin 5.1% Ttal Heavy Minerals (THM) with a valuable assemblage f 12% rutile, 6% leucxene, 6% zircn and 65% ilmenite at a cut-ff grade f 1.7% THM (see ASX Release 4 April 2016). Page 2

3 3. Explratin drilling ttalling 30,000 metres f aircre drilling at: a. Tanga Nrth - rutile-rich assemblage in a huge dune system; b. Madimba - cntinuus mineralised zne extending ver 2000m f strike, up t 250m wide, 9m thick and 5.4% THM; c. Tngani and Mafia - znes f untested high-grade mineralisatin at surface, and d. Sudi Bay, Kiswere and Bagamy - huge znes f unexplred highly anmalus mineralisatin. Placement Strandline has reslved t undertake a Placement with Temb t place 332,943,363 fully paid Ordinary Strandline shares, at an issue price f 0.7 cents per share, t raise apprximately $2.3 millin befre expenses. Temb will be paid a 3% fee in cnnectin with the Placement, which cvers expenses incurred by it in undertaking due diligence n Strandline and in cnnectin with the preparatin and negtiatin f the SRSA. The Placement issue price represents a premium f 17% t the last clsing price f Strandline shares n ASX, being 0.6 cents per share. Fllwing the Placement, Temb will have an interest in the Cmpany f 19.4%. The Placement frms the crnerstne f an verall funding strategy that will raise apprximately $6.6 millin befre expenses. The Placement will be cmpleted utilising the Cmpany s existing capacity pursuant t ASX Listing Rules 7.1 and 7.1A. Fully Underwritten Rights Issue Fllwing cmpletin f the Placement, Strandline will undertake a fully underwritten renunceable Rights Issue n the basis f ne new share ( Rights Issue Share ) fr every tw shares held at the recrd date at a price f 0.5 cents per Rights Issue Share, t raise up t $4.3 millin. The ffer price f 0.5 cents fr each Rights Issue Share represents a 17% discunt t the last clsing price f Strandline shares n ASX, being 0.6 cents per share. Additinally, fr every tw Rights Issue Shares issued, participants will als receive: One free attaching unlisted ptin exercisable at 1 cent per share with an expiry date f 30 June 2018; and One free attaching unlisted ptin exercisable at 1.5 cents per share with an expiry date f 30 June Page 3

4 Strandline has agreed a mandate with Hartleys Limited t act as Underwriter and Lead Manager in relatin t the Rights Issue (subject t executin f frmal underwriting and sub-underwriting agreements, which are currently being finalised and are expected t be executed imminently). Temb has agreed t fully subunderwrite the Rights Issue, subject t executin f the relevant frmal sub-underwriting dcumentatin. Strandline will annunce the Rights Issue timetable (including timing fr trading f entitlements) and despatch the assciated ffer dcumentatin t eligible sharehlders in the near future. Strategic Relatinship Strandline believes that Temb can add strategic, technical and financial value t the Cmpany and its prjects, t the benefit f all Strandline sharehlders. Accrdingly, the SRSA cntemplates that a strategic relatinship cmmittee will be established, cmprising representatives f bth parties, t prvide nn-binding advice and guidance t the Bard n majr wrk prgrammes prpsed by Strandline. Fllwing cmpletin f the Placement and cnsistent with its psitin as a significant sharehlder in Strandline, Temb will have the right t appint ne directr t the Cmpany s Bard fr s lng as it hlds 12.5% r mre (subject t the prvisins f the Crpratins Act, ASX Listing Rules and the Cmpany s Cnstitutin). It is expected that Mr Jhn Hdder f Temb will be added t the Strandline Bard as a nn- Executive Directr in that regard. Mr Hdder is a Gelgist by backgrund with a B.Sc. in Gelgical Sciences and a B.Cm. in Finance and Cmmerce frm the University f Queensland. He spent ten years in the mining and il and gas industries befre cmpleting a M.B.A. at Lndn Business Schl. Jhn established the Cmmnwealth Develpment Crpratin (CDC) mining, il and gas investment department in 1995 and was respnsible fr its investment activities fr sme eight years. He has served as a directr f a number f junir mining cmpanies and has significant experience f perating and investing in Africa. Jhn als wrked at Suncrp and Slaris as a Fund Manager fcusing n the resurces sectr managing an index-linked natural resurce prtfli f ~AUD$1.25bn. Temb has indicated that it has a lng-term investment strategy and intends t be supprtive f Strandline in its develpment f the Cmpany s mineral sands prtfli. Abut Temb Temb is a mining-fcussed private equity fund grup, which specialises in develping cuntries such as Tanzania and has a strng track recrd f identifying and supprting emerging resurce cmpanies. Temb has a team f experienced private equity investment and mining finance prfessinals, with a lng histry f assciatin with Africa and ther develping regins and cuntries. Page 4

5 Fr further enquiries, please cntact: Tm Eadie Managing Directr Strandline Resurces Limited T: E: enquiries@strandline.cm.au Fr media and brker enquiries: Andrew Rwell Investr Relatins Advisr Cannings Purple T: E: arwell@canningspurple.cm.au COMPETENT PERSON S STATEMENT The infrmatin in this reprt that relates t mineral explratin is based upn infrmatin cmpiled by Mr Tm Eadie, wh is a Fellw f the Australasian Institute f Mining and Metallurgy. Mr Eadie, wh is Managing Directr f Strandline Resurces, has sufficient experience which is relevant t the style f mineralisatin and type f depsit under cnsideratin and t the activity which he is undertaking t qualify as a Cmpetent Persn as defined in the 2012 Editin f the Australasian Cde fr Reprting f Explratin Results, Mineral Resurces and Ore Reserves. Mr Eadie cnsents t the inclusin in this release f the matters based n the infrmatin in the frm and cntext in which they appear. FORWARD LOOKING STATEMENTS This reprt cntains certain frward lking statements. Frward lking statements are nly predictins and are subject t risks, uncertainties and assumptins which are utside f the cntrl f Strandline. These risks, uncertainties and assumptins include cmmdity prices, currency fluctuatins, ecnmic and financial market cnditins, envirnmental risks and legislative, fiscal r regulatry develpments, plitical risks, prject delay, apprvals and cst estimates. Actual values, results r events may be materially different t thse cntained in this annuncement. Given these uncertainties, readers are cautined nt t place reliance n frward lking statements. Any frward lking statements in this annuncement reflect the views f Strandline nly at the date f this annuncement. Subject t any cntinuing bligatins under applicable laws and ASX Listing Rules, Strandline des nt undertake any bligatin t update r revise any infrmatin r any f the frward lking statements in this annuncement t reflect changes in events, cnditins r circumstances n which any frward lking statements is based. Page 17 Page 5