Rockwell is engaged in alluvial diamond production with focus on the mining and development of alluvial diamond deposits that yield high value gemstones. The Company has continued to operate three mines - Holpan, Klipdam and Saxendrift - during its first fiscal quarter of 2011, and has initiated a bulk sampling program on the Klipdam Extension property to evaluate this property, which is near to the Klipdam operation. All of these operations are located in the Northern Cape Province area of South Africa.

A total of 7,316 carats of diamonds were produced during the quarter, including a 66-carat stone recovered at the Company's Holpan mine and 124-carat and 145-carat stones recovered from production at its Saxendrift mine. The large diamonds were sold into Rockwell's joint venture agreement with Steinmetz Diamond Group ("SDG") to be manufactured and sold as polished goods, and will provide additional profit share revenue to the Company.

One tender sale of rough diamonds was held during the quarter. The Company received significantly improved prices for its better quality stones, particularly for diamonds with good color and clarity. The average price achieved was US$1,611.11 per carat.

Diamond Market

The prices received for the rough diamonds its recent tender are comparable to those achieved during calendar 2008, indicating the diamond business has improved over the past eighteen months. Other evidence of this recovery includes an increasing demand for larger stones. In addition, polished diamond prices have also improved in calendar 2010, although the increase in price of polished stones on a percentage basis is still less than for rough diamonds. The retail sector has shown a year-on-year increase in trade but has not yet fully recovered. Margins on polished stones are still small because of high rough diamond prices. Yet credit terms have improved from the exceptionally high terms offered to the industry prior to the credit crisis in late 2008, and this should increase the purchasing power of the retail sector.

Operations and Projects

During the first two months of the quarter Rockwell's three operations underperformed against budgeted production targets, but exceeded budgeted carats in May. This was primarily the result of weather factors and high sand contents in the ore bodies, which impeded plant throughput and processing capacity. Remedial actions have been put in place. The Company has implemented the construction of an in-pit screening facility at Saxendrift that will remove the fine sand fraction and oversize gravel component and produce a pre-concentrate ore that will be transported to the processing plant. This will result in cost savings in respect of transport and diesel greater processing capacity through the plant, and quicker rehabilitation thereby providing additional savings.

In May, the Company pre-commissioned its Klipdam Extension bulk sampling project to the east of the Klipdam mine. This project will evaluate alluvial diamond properties that the Company holds in the vicinity of Klipdam with a view to developing further production capacity from properties which yield good results in terms of grade and diamond value. The Company is also proceeding with the design, re-engineering of the Wouterspan processing plant to build a high volume low cost mining and processing operation with greater production capacity Saxendrift. The Company plans to delay the construction and re-commissioning of Wouterspan to ensure that front end engineering enhancements made at Saxendrift are incorporated into the new Wouterspan plant design. These will ensure greater throughput capacity and lower operating costs. At the same time Rockwell aims to fast track the acquisition of the Tirisano project (see below) to provide additional carat production in place of production from Wouterspan.

In the three month period ended May 31, 2010:

• 7,368 carats were produced at the Holpan, Klipdam and Saxendrift operations and the Klipdam Extension bulk sampling project, including contractor recoveries.
• 4,927.46 carats were sold at an average price of US$1,611.11 per carat.
• Tender sales of US$7.9 million plus US$0.3 million returns from beneficiation profit share (the joint venture with the Steinmetz Group, where rough stones are polished and sold and the profit shared) resulted in diamond revenues for the quarter of $8.5 million (US$8.2 million).
• Cost of sales including amortization, depletion and impairment charges totalled $6.0 million. A fair value adjustment on investments of $0.1 million was recognized in the quarter. This resulted in a combined amortization, depletion and impairment charge of $3.1 million for the quarter.
• An operating profit of $2.5 million was realized for the period.
• Net general and administrative expenses amounted to $1.4 million, travel and conference expenses amounted to $0.1 million, interest expenses amounted to $0.1 million and future income tax expense was $0.3 million.
• A loss of $0.03 million or $0.00 per share was realized for the period.
• Diamond inventories at May 31, 2010 totalled 4,351 carats.
• Production at the three operations steadily increased, reaching 756,476 cubic metres. The Company's overall increase in production has been significantly influenced by the expanded capacity of the Saxendrift plant.
• The Company's drive to cut costs and optimize its operations continues to yield results. The average operating cash cost over the quarter for the three operations was US$6.68 per cube, which is within the US$6.00 -- US$7.0 per cube range that was forecasted for fiscal 2011.
• The average total cost for all the operations over the first quarter of fiscal 2011, including rehabilitation, lease payments and royalties was US$9.95 per cube. These costs include the pre-commissioning of the Klipdam Extension bulk sampling project.

Additional details on production, sales and revenues for the quarter and with comparative results for the first quarter of fiscal 2010 are provided below. Complete financial results and the Company's Management Discussion and Analysis are posted on the website and on the Company's profile at www.sedar.com.

Production
Operation	3 months ending May 31, 2010			3 months ending May 31, 2009
	Volume (cubic meters)	Carats	Average grade (carats per 100 cubic meters)	Volume (cubic meters)	Carats	Average grade (carats per 100 cubic meters)
Holpan	199,030	2,016	1.01	190,660	987	0.52
Klipdam	216,083	2,950	1.37	210,710	1,608	0.76
Wouterspan	-	-	-	-	-	-
Klipdam Extension	9,052	3	0.03	-	-	-
Saxendrift	332,311	2,346	0.71	236,963	1,427	0.6
Other *	-	53	-	-	-	-
Total	756,476	7,368	0.97	638,333	4,022	0.63

Sales AND Revenue
Operation	3 months ending May 31, 2010				3 months ending May 31, 2009
	Sales (carats)	Value of Sales (US$)	Average value (US$ per carat)	Inventory (carats)	Sales (carats)	Value of Sales (US$)	Average value (US$ per carat)	Inventory (carats)
Holpan	1,514	2,233,774	1,475.62	1,282	1,144	316,344	276.41	683
Klipdam	1,390	867,695	623.98	2,156	2,473	1,183,274	478.50	877
Wouterspan	-	-	-	-	562	269,087	479.07	14
Klipdam Extension	-	-	-	3	-	-	-	-
Saxendrift	1,970	4,790,871	2,431.63	910	937	1,069,744	1,141.36	857
Other*	53	46,321	876.13	-	-	-	-	-
Total	4,927	7,938,660	1,611.11	4,351	5,116	2,838,449	554.79	2,431

*Other refers to an independent contractor processing gravels and sold with the groups tender. These carats are excluded from grade calculations.

In March 2010, the Company signed a term sheet for purchase 74% of the Tirisano or Blue Gum diamond operation, located in the Ventersdorp region of South Africa, from Etruscan Diamonds Ltd for an amount not exceeding South African Rand 33.5 million (approximately $4.65 million), payable in Rockwell shares. The Blue Gum property hosts an alluvial diamond deposit with 25 million cubic meters of indicated mineral resources and 15 million cubic meters of inferred mineral resources, both at an estimated grade of 2.37 carats/100 cubic meters (see Rockwell March 11, 2010 news release); operations are currently on care and maintenance.

The higher grade of the Tirisano deposits, compared to the low grades of Rockwell's Northern Cape operations, and large volume resources will facilitate high production rates and greater consistency of carat production, thereby smoothing the Company's revenue stream.

Completion of the acquisition is subject to a number of conditions including South African mining ministry consent, securities regulatory approvals including TSX, satisfactory due diligence and project development financing and electric power negotiations. The Rockwell shares to be issued will be subject to escrow, resale and voting restrictions and will not materially affect control. Completion is targeted for the third calendar quarter.

President and CEO John Bristow commented, "The Company continues to implement initiatives to improve operating and costs structures in all parts of its business which will form the foundation for Rockwell's growth and acquisition plans. The objective is to create a gemstone producer of about 10,000 carats per month in the long term. Plans to fund and achieve this target will be presented to shareholders in due course."

For further information on Rockwell and its operations in South Africa, please contact Investor Services at (604) 684-6365 or within North America at 1-800-667-2114.

John Bristow
President and CEO

A live and archived audio webcast will also be available at on the Company's website at www.rockwelldiamonds.com. The conference call will be archived for later playback until midnight (ET) July 26, 2010 and can be accessed by dialing (888) 203-1112 (toll free) in North America or (719) 457-0820 (toll) and using the pass code 5136455.

John Bristow
President and CEO

Effective June 1, 2010, the Company has purchased a 20% stake in FDTH that was previously held by Mr Hennie van Wyk for a consideration of South African Rand ("ZAR") 700,000 (approximately $97,000).

FDTH was established in 2006 to provide a professional marketing and sales facility to market and sell Rockwell's diamond production. Rockwell had no prior experience of marketing high quality alluvial gemstone production and with new diamond legislation in the process of being implemented at the time that Rockwell was establishing a foothold in South Africa, it was deemed prudent to ensure that Rockwell had access to a strong and secure dedicated marketing facility to maximize revenue from the sale of its unique diamond production.

FDTH was established in the premises of South Africa's internationally recognized high security diamond trading and manufacturing hub known as Jewel City, located on Commissioner Street in Johannesburg. FDTH was established and is still run by experienced and internationally recognized diamantaire, Jeffry Brenner.

The facility is operated by a small and highly experienced marketing and valuation team which collectively has over 100 years of rough diamond valuation, marketing and sales experience. FDTH follows rigorous diamond handling, security, and Kimberley Process protocols, and all marketing and sales procedures are monitored and facilitated by a proprietary computer based system. This system provides independent and transparent verification of results for sellers and buyers, and is acknowledged in the industry as a leading standard for transacting diamond sales.

Aside from providing a unique marketing and sales arm for Rockwell at a fee which is well below the market norm for provision of such services, FDTH also conducts sales on behalf of other small South African producers. In addition to providing a marketing and sales arm for Rockwell, FDTH has also facilitated the successful marketing and sales agreement that Rockwell entered into with the Steinmetz Diamond Group. This agreement allows Rockwell to share in profits generated from the manufacture and sales of large and unique stones mined at Rockwell's operations.

The recently acquired 20% stake in FDTH will provide Rockwell with access to additional revenue, allowing the Company to gain insight into diamond sales trends which will assist with its short and long term production and growth plans.

John Bristow, CEO commented "Our investment in FDTH provides us with additional revenue flow and will assist the Company to better understand the demand from, and penetration into, an international diamond market which is undergoing progressive change with the emergence of strong new players in India and China. Rockwell will remain focussed on being a successful mining company, but every opportunity to monitor and understand its markets and buyers will assist us with short and long term plans for growth and development."

For further details on Rockwell Diamonds Inc., please visit the Company's website at www.rockwelldiamonds.com or contact Investor Services at (604) 684-6365 or within North America at 1-800-667-2114.

John Bristow
President and CEO

Rockwell currently operates the Holpan and Klipdam mines north of Kimberley, and the Saxendift mine on the Middle Orange River ("MOR") southwest of Kimberley. The Wouterspan mine, also located on the MOR, is currently on care and maintenance. All of these operations are located in the Northern Cape Province of South Africa.

Large Diamonds of over 50 carats

During April and May 2010, Rockwell recovered three large gemstone diamonds from its Holpan and Saxendrift operations.

A 66-carat stone clean white (colour E to F) elongated and slightly flattened stone with minor inclusions was recovered from the Holpan operation during April 2010.

At Saxendrift, stones of 124 and 145 carats were recovered during May 2010.

• The 124-carat stone is F to G in colour, blocky and resorbed in shape and appearance, and has a line of inclusion set along an internal flaw.
  
  
• The 145-carat Saxendrift stone is a light yellow ("Cape"), with rounded octahedral shape and inclusions.

Year to Date Diamond Sales

Results of Rockwell calendar year to date diamond sales are presented below. These sales and revenues have come from a combination of tenders, sale of special stones into the Company's joint venture beneficiation and profit share arrangement with SDG and sales to the South African State Diamond Trader. In its most recent diamond sale, the Company achieved an average of US$1,735 per carat which was achieved from the sale of 3,034.30 carats. The year to date average for Rockwell diamond production is about US$1,216 per carat which is 19% below Rockwell's long term average of US$1,500 per carat.

During the year to date, the Company has also received approximately US$1.27 million as its portion of profit share from stones that have been beneficiated in terms of Rockwell's agreement with SDG. This profit share has been derived from stones sold into the SDG beneficiation agreement in November 2009 and February 2010. The Company has a large number of +10 carat stones currently undergoing beneficiation and sales with SDG and expects to achieve a regular income flow from this source during fiscal 2011.

Rockwell has also had three tender sales so far in calendar 2010 during the months of February, April and May. Average results from total sales for each operation are tabulated below, followed by results for each sale.

Mine	Carats	Revenue US$	US$/carat
Holpan	3,438.09	$ 3,737,203.83	$1,087
Klipdam	4,824.02	$ 2,547,082.56	$ 528
Saxendrift	4,960.58	$ 9,782,263.76	$1,972
GRAND TOTAL	13,222.69	$16,066,550.15	$1,216

February 2010 Diamond Sale

During February, Rockwell sold some 5,887.57 carats, including 70 stones of larger than 10 carats in size. The average price achieved for this sale was US$1,154 per carat. Details of the sales prices achieved for the different operations are shown in the table below.

Mine	Carats	Revenue US$	US$/carat
Holpan	1,183.27	$1,114,640.34	$   942
Klipdam	2,315.05	$1,264,017.30	$   546
Saxendrift	2,497.70	$4,490,864.46	$1,798
TOTALS	5,996.02	$6,919,407.08	$1,154

April 2010 Diamond Sale

In April, the Company undertook a sale of 3,592.40 carats, including 31 stones of larger than 10 carats. The smaller average stone size of this parcel and fewer stones of +10 carats in comparison to the February and May parcels resulted in a lower overall average price per carat achieved for this production parcel.

Mine	Carats	Revenue US$	US$/carat
Holpan	1,435.20	$1,077,835.20	$   751
Klipdam	1,217.54	$525,977.28	$   432
Saxendrift	1,539.63	$2,053,550.82	$1,513
TOTALS	4,192.37	$3,933,272.67	$   938

May 2010 Diamond Sale

In late May, Rockwell sold a parcel of 3,034.30 carats, including 24 stones of larger than 10 carats. A stone of 66 carats from Holpan and two stones larger than 100 carats from Saxendrift were included in this sale. The average price achieved for this sale was US$1,735 per carat.

Project	Carats	Revenue US$	US$/carat
Holpan	819.62	$1,545,803.32	$1,885
Klipdam	1,291.43	$759,360.84	$587
Saxendrift	923.25	$2,959,016.25	$3,204
TOTAL	3,034.30	$5,264,510.50	$1,735

Rockwell Production Profile and Large Diamonds

Overall, the diamonds recovered and sold by Rockwell in 2010 has been in line with the Company's predicted production profile, and is characterized by a high proportion of diamonds of larger than 2 carats in size, and regular recovery of stones of larger than 50 and 100 carats.

In the year to date, Rockwell has recovered 125 stones of larger than 10 carats in size. This included the 66-carat stone from Holpan, and two gemstones of over 100 carats from Saxendrift. A 100-carat boart or industrial stone was also recovered from Klipdam. The average price for Klipdam production is currently below the budgeted value though this is not uncommon in low grade alluvial deposits of this nature where overall diamond quality is typically variable in nature. Recently, there has been improvement in the quality of stones recovered at Klipdam. Although the 100-carat stone recovered from this mine was a boart, it indicates the ongoing presence of large stones in this deposit. The largest stone recovered from this deposit by Rockwell was a 189.6 carat white gemstone in late 2008.

Polished Diamond Sales

Polished diamond prices have an impact of rough diamond sales and have shown steady improvement in 2010 so far, which is encouraging for Rockwell and the industry overall. According to IDEX Online Research reports, global polished diamond prices have continued to recover in May, extending a trend that began in the last quarter of calendar 2009. The IDEX index for polished sales stood at an average of 116.5 for the month of May 2010, representing a 7.1 percent increase over a year ago, and a 1.6 percent rise over the average price for April 2010.

President and CEO John Bristow commented, "The Company is encouraged by the strength and resilience of the rough diamond market through the first six months of 2010 and the improvement in prices in almost all categories of Rockwell's production. The firming of polished prices is equally positive for the market. Although we anticipate a normal seasonal slowdown in sales during the forthcoming European and North American summer vacations, we expect the market to show some further strengthening in the later part of the year in the lead up to the Thanksgiving and Christmas holidays in 2010."

For further information on Rockwell and its operations in South Africa, please contact Investor Services at (604) 684-6365 or within North America at 1-800-667-2114.

John Bristow
President and CEO

Rockwell is engaged in alluvial diamond production with focus on the mining and development of alluvial diamond deposits that yield high value gemstones. In fiscal 2010, the Company operated at the Holpan, Klipdam and Saxendrift mines, and placed the Wouterspan mine on care and maintenance due to the international credit crisis and sharp decline in diamond prices.

The Company's rapid response in late 2008 to the international credit crunch ensured that it was able to address the challenges of the world economic crisis and the concomitant significant decline in international diamond prices. Through a combination of proactive restructuring, flexibility, and resourcefulness at its three producing operations the Company was able to reduce costs, increase production, and leverage diamond prices in a highly challenging market.

As difficult as the past 18 months have been, there have been several highlights that ensured that Rockwell managed the economic crisis, and that bode well for the Company moving forward. These include:

• The excellent performance of the Saxendrift mine and high volume rotary-pan plant following its commissioning in early 2009 at the height of the world economic crisis;
• The sustained lower cash operating cost achieved by the Company which was at the lower end of its target range of $3 - 3.50 per tonne;
• Regular recovery of stones greater than 10 carats including exceptional diamonds of greater than 100 carats in size from the Saxendrift operation;
• Receipt of approximately US$1.9 million of profit share from the Company's beneficiation agreement with the Steinmetz Diamond Group in spite of a very depressed diamond market; and
• The successfully completion of a private placement and fully subscribed rights offer which allowed the Company to strengthen its balance sheet, retire short term debt, and reposition itself for organic growth and potential acquisitions of alluvial diamond assets that will add significant new production.

Rockwell again produced some exceptional stones during fiscal 2010. Nine plus 30-carat diamonds were recovered during the year, including three excellent gemstones larger than 100 carats (105.62 carats, 120.45 carats, 122.43 carats) from Saxendrift.

Prices received for the Company's diamond production increased progressively through the latter part of fiscal 2010 reflecting a strong recovery in international diamond prices following the sharp decline (50% on average) in the fourth quarter of fiscal 2009. The average price received in the fourth quarter of 2010 was US$1,154 per carat, a substantial increase from the average price of US$318.32 per carat in the fourth quarter of fiscal 2009. As a consequence of a steady improvement in diamond prices through the last two quarters of fiscal 2010, and on-going resilience and price improvements into fiscal 2011, Rockwell is in the process of re-initiating its growth and acquisition plans to increase its production profile. At the same time the Company continues to manage costs, leverage diamond sales, and increase production to maximize revenues.

In the twelve months ending February 28, 2010:

• 24,915.9 carats were produced from operations at Holpan/Klipdam, Wouterspan and Saxendrift.
• 26,532.4 carats were sold at an average price of US$1,010.21 per carat.
• Tender sales of $26.4 million, plus returns from beneficiation profit share of US$1.9 million resulted in income for the year of $29.8 million (US$28.3 million).
• Cost of diamond sales was $22.9 million and amortization and depletion was $9.5 million for total operating expenses of $32.4 million.
• An operating loss of $2.7 million was realized for the year. Net general and administrative expenses amounted to $8.7 million, and net interest expenses were $1.5 million, offset by a net tax recovery of $2.6 million.
• A loss of $7.0 million or $0.03 per share was realized for the period, compared to $13 million or $0.05 per share in fiscal 2009.

The following is a comparison of the twelve-month results for fiscal 2010 with those in fiscal 2009.

Production
Operation	12 months ending February 28, 2010			12 months ending February 28, 2009
	Volume (cubic meters)	Carats	Average grade (carats per 100 cubic meters)	Volume (cubic meters)	Carats	Average grade (carats per 100 cubic meters)
Holpan	805,925	6,398.2	0.79	561,583	4,127.4	0.73
Klipdam	895,669	9,669.8	1.08	711,924	7,041.8	0.99
Wouterspan	-	14.1	-	552,293	3,897.1	0.71
Saxendrift	1,216,503	8,833.8	0.73	194,287	2,436.7	1.18
Total	2,918,097	24,915.9	0.85	2,020,087	17,503.0	0.87

Sales, Revenue and Inventory
Operation	12 months ending February 28, 2010				12 months ending February 28, 2009
	Sales (carats)	Value of Sales (US$)	Average value (US$ per carat)	Inventory (carats)	Sales (carats)	Value of Sales (US$)	Average value (US$ per carat)	Inventory (carats)
Holpan	6,457.7	3,166,842	492.09	780.3	3,741.1	4,272,511	1,142.05	839.8
Klipdam*	10,816.7	6,301,240	581.26	595.4	5,657.0	18,954,292	3,350.61	1,742.3
Wouterspan	591.0	280,193	475.32	0.0	3,640.8	4,698,121	1,290.41	576.9
Makoenskloof	-	-	-	-	212.0	1,500,119	7,076.03	-
Saxendrift	8,667.1	17,055,281	1,967.81	533.9	2,069.5	3,656,268	1,766.71	367.2
Total	26,532.5	26,803,556	1,010.21	1,909.6	15,320.4	33,081,311	2,159.30	3,526.2

*Included in the Klipdam inventories and sales are 322.02 carats at $122,973 from ERF-1 Windsorton, a prospecting right within the Holpan-Klipdam mining area.

The Company realized a loss of $7.0 million for the twelve month period ended February 28, 2010 compared to a loss of $13.0 million for the prior year. The loss was due to the collapse in the diamond market and precipitous decline in diamond prices that commenced in the fourth quarter of fiscal 2009 due to the ongoing global credit crisis and economic recession. This resulted in on-going weakness of diamond prices through the first two quarters of fiscal 2010 and the slow recovery in the third quarter. Though prices remained weak during this period there has been an overall improvement in prices of about 49% from the initial sharp fall in prices of about 50% in the last quarter of fiscal 2009.

During the twelve months ended February 28, 2010, the Company realized rough diamond sales of $29.8 million compared to $34.3 million for the comparable period in the prior year. Diamond prices have gradually recovered, climbing to US$1,090.55 per carat in July, US$862.36 per carat in August/September tenders, US$1,434.33 in November and US$1,154.11 in the January/February tender. The lower price per carat received in August and January/February was related to lower grade mixes of stones.

The credit crunch and ensuing recession resulted in diamond prices falling sharply in late calendar 2008 (fourth quarter of fiscal 2009). Sales prices achieved in the first quarter of fiscal 2010 were below the cost of production; however, prices achieved in the second quarter covered the cost of production, but were not sufficient to cover fixed overheads in full and lease payments. To maintain liquidity, sales were made below production cost. This resulted in the Company invoking the payment deferral with Komatfin, which ended on November 1, 2010.

Income generated in November 2009 was sufficient to cover all the third quarter costs and significant arrear creditors, including ZAR11.4 million ($1.6 million) for outstanding royalties. The November income resulted in a third quarter operating profit. The operating profit in the fourth quarter covered the cost of operations.

Mining costs for the twelve months ended February 28, 2010 amounted to $22.9 million (twelve months ended February 28, 2009- $25.1 million), which excludes amortization and depletion charges of $9.5 million (twelve months ended February 28, 2009 -- $11.3 million).

Exploration expenses (excluding stock-based compensation) decreased to $97,805 for the twelve months ended February 28, 2010 compared to $498,739 for the same period in the prior year as a result of diminished exploration activity.

Administrative cost also decreased in fiscal 2010. Office and administrative costs for the twelve months ended February 28, 2010 decreased to $3.4 million from $3.5 million incurred for the same period in the prior year, primarily the result of controlling costs and reducing overheads. Travel and conference expenses amounted to $194,544 for the twelve months ended February 28, 2010 compared to $605,812 for the same period in the previous year. Legal, accounting and audit expenses for the twelve months ended February 28, 2010amounted to $1.4 million compared to $1.9 million incurred for the same period in the prior year. The Company has experienced significant legal costs due to the unsolicited bid by Pala and the capital raising exercise.

Stock-based compensation decreased to $0.3 million for the twelve months ending February 28, 2010 in comparison to $1.8 million for the same period in the previous year.

Net interest expenses were $1.1 million for the twelve months ended February 28, 2010, compared to $1.9 million for the twelve months ended February 28, 2009 due to the use of the credit facility in fiscal 2009 to maintain working capital and the deferred lease payments.

Additional details can be found in the Company's Financial Statements and Management's Discussion and Analysis which are filed on www.sedar.com.

The Company completed financings to strengthen its balance sheet. In the fourth quarter of fiscal 2010, gross proceeds of $8.6 million were raised in a private placement to new and existing shareholders. These funds were utilized to repay a four month payment deferral (capital portion of lease payments) from Komatfin, the institution that finances the Mobile Production Vehicles (yellow fleet), a short term, partially secured, borrowing facility, debts incurred in the unsolicited bid by Pala Investments and fund raising fees..

Subsequent to year end, an additional $8.0 million raised through a fully subscribed rights offering and standby facility. A portion of the proceeds is planned to be used for production enhancements at the Saxendrift mine, and the proposed modernization and expansion of the plant at Wouterspan, an operation with a history of producing high-quality stones. Limited expenditure will also be made on ensuring that the planning and construction requirements for the proposed Tirisano or Blue Gum acquisition (see below) are fully evaluated and costed so that the Company can rapidly proceed with the development and commissioning of this project once the conditions precedent are met to complete this transaction.

In March 2010, the Company signed a term sheet for purchase 74% of the Tirisano or Blue Gum diamond operation, located in the Ventersdorp region of South Africa, from Etruscan Diamonds Ltd for an amount not exceeding South African Rand 33.5 million (approximately $4.65 million), payable in Rockwell shares. The Blue Gum property hosts an alluvial diamond deposit with 25 million cubic meters of indicated mineral resources and 15 million cubic meters of inferred mineral resources, both at an estimated grade of 2.37 carats/100 cubic meters (see Rockwell March 11, 2010 news release); operations are currently on care and maintenance. The transaction is expected to be complete in the third quarter of fiscal 2011.

The Tirisano project, together with the proposed modernization and re-commissioning of the Wouterspan project will provide Rockwell with additional high quality gemstone production and help smooth the Company's revenue and cash flow once these operations are in production. The proposed development program is in line with the broad plan of growth and acquisition plans outlined to shareholders in 2009.

President and CEO John Bristow commented, "The Company implemented significant improvements to operating and costs structures in all parts of its business in fiscal 2010 to sustain the business in a very harsh economic climate and to also provide the foundation for future growth. We are proceeding cautiously with expansion and acquisition plans, mindful of the economic challenges and legacies of the recession in 2010, and are considering our options to fund and develop proposed new growth projects, including engaging with its existing shareholders and strategic partners that invested in Rockwell in the private placement completed in fiscal 2010."

The Company will host a telephone conference call on Tuesday, June 1, 2010 at 10:00 a.m. Eastern Time (7:00 a.m. Pacific; 4:00 p.m. Johannesburg) to discuss these results. The conference call may be accessed by dialing (877) 381-4602 (toll free) or (760) 666-3757 (toll) in North America, 0 800 032 3836 (toll free) in the United Kingdom and 0800 999 567 (toll free) in South Africa.

A live and archived audio webcast will also be available at on the Company's website at www.rockwelldiamonds.com. The conference call will be archived for later playback until midnight (ET) June 7, 2010 and can be accessed by dialing (800) 642-1687 (toll free) in North America or (706) 645-9291 (toll) and using the pass code 78573195.

For further information on Rockwell and its operations in South Africa, please contact Investor Services at (604) 684-6365 or within North America at 1-800-667-2114.

John Bristow
President and CEO