HAMMER METALS LIMITED — AGM Information 2011

Oct 26, 2011

MIDAS RESOURCES LIMITED ABN 87 095 092 158

NOTICE OF ANNUAL GENERAL MEETING

The Celtic Club 48 Ord Street, West Perth, Western Australia at 1:00 pm (WST) on Wednesday, 30 November 2011

MIDAS RESOURCES LIMITED

ABN 87 095 092 158

NOTICE OF ANNUAL GENERAL MEETING

Notice is given that the Annual General Meeting of Shareholders of Midas Resources Limited (“Company”) will be held at The Celtic Club, 48 Ord Street, West Perth, Western Australia, at 1:00 pm (WST) on Wednesday, 30 November 2011.

The Explanatory Statement to this Notice of Meeting provides additional information on matters to be considered at the Annual General Meeting. The Explanatory Statement and the proxy form are part of this Notice of Meeting.

The Directors have determined pursuant to Regulation 7.11.37 of the Corporations Regulations 2001 (Cth) that the persons eligible to vote at the Annual General Meeting are those who are registered Shareholders of the Company at the close of business on 28 November 2011.

AGENDA

GENERAL BUSINESS

1. ADOPTION OF THE ANNUAL FINANCIAL REPORT

To receive the Annual Financial Report, including Financial Statements, Directors‟ declarations and accompanying reports of the Directors and auditors for the financial year ended 30 June 2011.

2. RESOLUTION 1- ADOPTION OF THE REMUNERATION REPORT

To consider and, if thought fit, to pass, with or without amendment, the following resolution as a non-binding resolution :

“That, for the purposes of Section 250R(2) of the Corporations Act and for all other purposes, approval is given to the adoption of the Remuneration Report as contained in the Company’s financial report for the year ended 30 June 2011.”

Short Explanation : The vote on this resolution is advisory only and does not bind the Directors or the Company. However the Board will take the outcome of the vote into consideration when reviewing the remuneration practices and policies of the Company.

3. RESOLUTION 2 – RE-ELECTION OF DIRECTOR – MR TERRY STREETER

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution :

“That for all purposes, Mr. Terry Streeter, a director of the Company, retires by rotation in accordance with Rule 7.3 of the Constitution and, being eligible, is reelected as a Director of the Company.”

4. RESOLUTION 3 – RE-ELECTION OF DIRECTOR – MR JOHN HOPKINS

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution :

“That for all purposes, Mr. John Hopkins, a director of the Company, retires by rotation in accordance with Rule 7.3 of the Constitution and, being eligible, is reelected as a Director of the Company.”

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5. RESOLUTION 4 – GRANT OF OPTIONS TO MR JOHN HOPKINS

To consider and, if thought fit, to pass, with our without amendment, the following resolution as an ordinary resolution:

“That, for the purposes of Listing Rule 10.11 of the Listing Rules of Australian Stock Exchange Limited, Chapter 2E of the Corporations Act and for all other purposes, approval is given for the Company to grant, for no cash consideration, up to 1,000,000 options to acquire a fully paid ordinary share in the capital of the Company, to John Hopkins (or his nominee) and otherwise on the terms and conditions set out in the Explanatory Statement accompanying this Notice”

6. RESOLUTION 5 – REMUNERATION OF NON-EXECUTIVE DIRECTORS

To consider, and if thought fit, to pass, with or without modification, the following ordinary resolution:

"That for the purpose of Listing Rule 10.17 and all other purposes, the maximum aggregate remuneration payable to Directors as Directors fees in any financial year be increased to $300,000.

DATED this 11[th] day of October 2011

BY ORDER OF THE BOARD

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MIDAS RESOURCES LIMITED MARK PITTS COMPANY SECRETARY

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Notice of Annual General Meeting – November 2011

EXPLANATORY STATEMENT

This Explanatory Statement has been prepared for the information of the Shareholders of the Company in connection with the business to be conducted at the Annual General Meeting to be held at The Celtic Club, 48 Ord Street, West Perth, Western Australia, at 1:00 pm (WST) on Wednesday, 30 November 2011.

This purpose of this Explanatory Statement is to provide information which the Directors believe to be material to Shareholders in deciding whether or not to pass the Resolutions in the Notice of Meeting.

1. FINANCIAL STATEMENTS AND DIRECTORS’ REPORTS

In accordance with the Company‟s Constitution, the business of the meeting will include receipt and consideration of the Company‟s Financial Report and reports of Directors and Auditors for the year ended 30 June 2011.

2. RESOLUTION 1 – ADOPTION OF REMUNERATION REPORT

That the Remuneration Report as set out in the Company‟s Annual Report for the year ended 30 June 2011 be adopted.

Following recent changes to the Corporations Act 2001, if 25% or more of votes that are cast are voted against the adoption of the Remuneration Report at two consecutive AGM‟s, shareholders will be required to vote at the second of those AGM‟s on a resolution („spill resolution‟) that another meeting be held within 90 days at which all of the Company‟s directors (excluding the Managing Director) must offer themselves for reelection.

The Remuneration Report is for consideration and adoption by way of non-binding resolution. The vote on this resolution is advisory only and does not bind the Directors of the Company. However, the Board will take the outcome of the vote into consideration when reviewing the remuneration practices and policies of the Company.

The Board considers that its current practices of setting executive and non executive remuneration are well within normal industry expectations, and provide an effective balance between the need to attract and retain the services of the highly skilled key management personnel that the Company requires. As such the directors recommend that shareholders vote in favour of the Company‟s remuneration report at Resolution 1.

If you choose to appoint a proxy you are encouraged to direct your proxy how to vote on Resolution 1 by either marking either For, Against or Abstain on the voting form.

By marking the „Chairman‟s voting box‟ on the proxy form you acknowledge that the Chairman will exercise your proxy, in line with his stated intention, even if he has an interest in the outcome of the resolution . If you do not direct your proxy how to vote, or do not mark the Chairman’s voting box on the proxy form your votes will not be counted.

The Chairman of the meeting intends to vote undirected proxies that are able to be voted in favour of the adoption of the remuneration report.

The Remuneration Report is set out in the Midas Resources Limited Annual Report 2011 and is also available on the Company‟s web site (www.midasresources.com.au).

3. RESOLUTION 2 – RE-ELECTION OF DIRECTOR – MR TERRY STREETER

Rule 7.3 of the Constitution requires that one third of the Company‟s Directors must retire at each annual general meeting. A Director who retires under rule 7.3 is eligible for reelection.

Mr Streeter retires by rotation and offers himself for re-election.

Information about Mr Streeter is available in the Annual Report of the Company and on the Company‟s web site at www.midasresources.com.au.

4. RESOLUTION 3 – RE-ELECTION OF DIRECTOR – MR JOHN HOPKINS

Rule 7.3 of the Constitution also requires any Director appointed as an addition to the Board or to fill a casual vacancy holds office only until the termination of the next annual general meeting of the Company and is eligible for re-election at that annual general meeting but is not taken into account in determining the number of Directors who must retire by rotation at that meeting.

Mr Hopkins was appointed as a Director on 1 June 2011 as an addition to the Board, and in accordance the Constitution retires, and being eligible, offers himself for election as a Director of the Company.

Information about Mr Hopkins is available in the Annual Report of the Company and on the Company‟s web site at www.midasresources.com.au.

5. RESOLUTION 4 – GRANT OF OPTIONS TO MR JOHN HOPKINS

Resolution 4 seeks Shareholder approval for the issue of 1,000,000 Options to Mr John Hopkins, a Director, or his nominee (“Mr Hopkins”) at no cost.

The grant of these Options to Mr Hopkins is designed to provide an incentive to Mr Hopkins, as Director and Chairman, to provide dedicated and ongoing commitment to the continued growth of the Company. Importantly these Options are structured as follows:

Number of options	Performance criteria to be satisfied for the options to become exercisable	Exercise price of options	Expiry date
1,000,000	Exercisable immediately from grant	2.8 cents(1)	30 November 2014

• (1) The exercise price of the options to be issued is to be calculated on the following basis. By calculating the 10 day VWAP of the closing price of the Company‟s shares as traded on the ASX up to the date of issue and adding an additional 50%. (2.8 cents is shown as an estimate based on the current trading price)

The above approval is sought for the purposes of:

Chapter 2E of the Corporations Act 2001, which governs the giving of financial benefits to directors and other “related parties” of a company; and

ASX Listing Rule 10.11 which provides that, subject to certain exceptions, a company listed on ASX cannot issue or grant securities to a director without shareholder approval.

The Board considers that in view of the financial, legal and other responsibilities assumed by directors of public companies, the payment of monetary fees alone is not an adequate reward and does not provide and adequate incentive to enable the

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Company to attract and keep board members and executive directors of requisite level of experience and qualifications. The Board considers that equity participation by way of the grant of options to members of the Board is appropriate for these purposes. In addition, the Board considers that issuing of options will contribute to the preservation of the Company‟s cash reserves. The total Options exercise consideration with respect to the Shares to be issued on exercise of the 1,000,000 Options is $28,000.

The Directors determined the number and exercise price of these Options in light of the recent price of Shares in the Company and the relevant experience and role of Mr Hopkins, his respective overall remuneration terms, the current market price of Shares and the terms of options packages granted to directors of other companies within the industry.

The Options to be granted will form part of Mr Hopkins‟s remuneration package payable by the Company.

ASX Listing Rule 10.11

ASX Listing Rule 10.11 provides that a company must not issue securities (including options) to a related party of the company, such as a director, without the company obtaining shareholder approval.

Accordingly, Resolution 4 seeks Shareholder approval for the grant of Options to Mr Hopkins, who is a related party of the Company by virtue of his position as a Director.

Approval pursuant to ASX Listing Rule 7.1 is not required in order to issue the Options to Mr Hopkins (or his nominee) as approval is being obtained under ASX Listing Rule 10.11. Shareholders should note that the issue of securities to Mr Hopkins (or his nominee) will not be included in the 15% calculation for the purposes of ASX Listing Rule 7.1.

For the purposes of ASX Listing Rule 10.13, the following information is provided in relation to Resolution 4:

• (a) 1,000,000 Options will be issued by the Company to Mr Hopkins;

• (b) the Options will be issued on the terms and conditions set out below;

• (c)

• the Options will be issued for no consideration;

• (d) the Options will be issued not later than one (1) month after the date of this Meeting (or such later date as permitted by any ASX waiver or modification of the ASX Listing Rules) and it is anticipated that the Options will be issued on one date; and

• (e) there will be no funds raised from the issue of the Options as they will be issued as an incentive for the Director to provide dedicated and ongoing commitment to the Company. Should these Options be exercised, the Company will receive funds.

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Terms and Conditions of Options

The terms and conditions of the Options are as follows:

• (a) each Option entitles the holder, when exercised, to one (1) Share;

• (b) the expiry date is 36 months from issue date;

• (c) the Options are exercisable at the exercise price and vest to Mr Hopkins on the following conditions:

		Exercise price of options
Number of options	Performance criteria to be satisfied for options to vest
			Expiry date
1,000,000	Exercisable immediately from grant	To be determined(1)	30 November 2014 (3 years from issue)

• (1) The exercise price of the options to be issued is to be calculated on the following basis. By calculating the 10 day VWAP of the closing price of the Company‟s shares as traded on the ASX up to the date of issue and adding an additional 50%. (2.8 cents is shown as an estimate based on the current trading price)

• (d) the Options will not be quoted on ASX;

• (e) all Shares issued upon exercise of the Options will rank pari passu in all respects with the Company‟s then issued Shares. The Company will apply for official quotation by ASX of all Shares issued upon exercise of the Options;

• (f) there are no participating rights or entitlements inherent in the Options and optionholders will not be entitled to participate in new issues of capital offered to shareholders during the currency of the Options. However, the Company will ensure that for the purposes of the proposed issue notice of the new issue will be given to optionholders at least seven (7) Business Days before the record date. This will give optionholders the opportunity to exercise their Options prior to the date for determining entitlements to participate in any such issue;

• (g) in the event of any new or bonus issues, there are no rights to a change in exercise price, or a change in the number of underlying securities over which the Options can be exercised;

• (h) in the event of any reorganisation of the issued capital of the Company prior to the expiry date of the Options, all rights of the optionholder will be varied in accordance with the ASX Listing Rules; and

• (i) the Options will lapse 30 days after Mr Hopkins ceases to be director of the Company.

Details concerning Value of Options

The Directors of the Company have ascertained the value of the 1,000,000 Options to be issued to Mr Hopkins to be approximately $15,395.

This value has been ascertained using the Black-Scholes valuation method and is based upon the following inputs and assumptions:

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• (a) current share price of 2.0 cents;

• (b) an estimated volatility factor of 144.7%;

• (c) option exercise prices as noted above;

• (d) a risk free rate of 5.06%; and

• (e) a term to expiry of 36 months (30 November 2014)

In deriving the valuation, the Black-Scholes method relies on the following assumptions:

• (a) the Options can be exercised at any time during the period;

• (b) there are no transaction costs and the securities are infinitely divisible and information is available to all without cost; and

• (c) the risk free interest rate is known and constant throughout the duration of the option contract.

The Options will not be quoted on ASX. For the sake of this valuation no discount has been applied for the inability to transfer the Options.

6. RESOLUTION 5 – REMUNERATION OF NON-EXECUTIVE DIRECTORS

As an ordinary resolution:

The Company‟s Constitution requires Shareholder approval be obtained in respect of the maximum Director fees payable to Non-executive Directors. Agenda item 6 proposes to set the maximum amount to be $300,000 per annum. The revised amount will cater for future expansion of the Board.

Company total remuneration for all Non-Executive directors of up to $165,000 was last approved by Shareholders in the 2001 Annual General Meeting.

7. ENQUIRIES

Shareholders are required to contact the Company Secretary on (61 8) 9388 2211 if they have any queries in respect of the matters set out in these documents.

8. VOTING BY PROXY

Entitlement to vote

1 Voting Entitlement

For the purposes of determining voting entitlements at the Meeting, Shares will be taken to be held by the persons who are registered as holding the Shares at close of business (5pm WST) on 28 November 2011. Accordingly, transactions registered after that time will be disregarded in determining entitlements to attend and vote at the Meeting.

2 Proxies

Members are advised that:

• each member has a right to appoint a proxy to attend and vote for them;

• the proxy need not be a member of the Company; and

• a member who is entitled to cast 2 or more votes may appoint either 1 or 2 proxies and may specify the proportion or number of votes each proxy is appointed to exercise. If the appointment is for 2 proxies and does not specify the proportion or number of votes each proxy may exercise, then, in accordance with section 249X(3) of the Corporations Act, each proxy may exercise half of the votes.

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Notice of Annual General Meeting – November 2011

To vote by proxy, please complete and sign the proxy form enclosed and send the proxy form:

• (a) by post to Midas Resources Limited, PO Box 375, Subiaco, Western Australia, 6904;

• (b) deliver to the registered office of the Company at Level 1, 282 Rokeby Road, Subiaco, Western Australia, 6008; or

• (c) by facsimile to the Company on facsimile number (61 8) 9388 2600,

so that it is received not later than 1:00 pm (WST) on 28 November 2011.

Proxy forms received later than this time will be invalid

The proxy form must be signed by the shareholder or his/her attorney duly authorised in writing or, if the shareholder is a body corporate, in a manner permitted by the Corporations Act. In the case of Shares jointly held by two or more persons, at least one joint holder must sign the proxy form. A proxy form is attached to this Notice.

3 Voting Prohibition Statement

A vote on Resolutions 1, 4 and 5 must not be cast (in any capacity) by or on behalf of any Key Management Personnel (KMP) which includes the Directors of the Company, details of whose remuneration are included in the Remuneration Report, or any closely related party of that person (or those persons).

However, a person described above may vote on Resolution 1 if the person does so as a proxy appointed by writing, that specifies how the proxy is to vote on the Resolution, or where no voting directions have been given and the proxy votes consistent with the stated intention to vote valid undirected proxies, and the vote is not cast on behalf of a member of the Key Management Personnel or any closely related party of that person (or persons).

4 Voting Exclusion

The Company will disregard any votes cast on Resolution 4 by Mr John Hopkins, and any associate of Mr Hopkins.

Notwithstanding the above, the Company need not disregard a vote if:

• by a person as proxy for a person who is entitled to vote in accordance with the directions on the proxy form;

• by the person chairing the meeting as a proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

All Directors and any of their associates are excluded from voting on Resolution 5. Accordingly, the Company will disregard any votes cast on Resolution 5 by any Director or any of their associates.

Notwithstanding the above, the company will not disregard a vote on Resolution 5 if it is cast in the following circumstances:

• by a person as proxy for a person who is entitled to vote in accordance with the directions on the proxy form;

• by the person chairing the meeting as a proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

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GLOSSARY

" ASX " means the Australian Stock Exchange Limited;

“ ASX Listing Rules ” or “ Listing Rules ” means the Listing Rules of the ASX.

“ Board ” means the board of Directors of the Company from time to time;

" Company " or " Midas " or “ MDS” means Midas Resources Limited (ACN 095 092 158);

" Corporations Act " means Corporations Act 2001 (Cth);

“ Constitution ” means the Company‟s constitution

" Director " means a director of the Company and, where the context required;

“ Explanatory Statement ” means the Explanatory Statement accompanying this Notice of Meeting;

" Notice of Meeting " means the Notice of Annual General Meeting accompanying this Explanatory Memorandum;

"Option " means options to acquire MDS Shares on the terms and conditions set out in Annexure A to this Explanatory Statement;

“ Share ” means a fully paid ordinary share in the Capital of the Company;

“ WST ” means Western Standard Time

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Notice of Annual General Meeting – November 2011

PROXY FORM

APPOINTMENT OF PROXY - MIDAS RESOURCES LIMITED - ABN 87 095 092 158

GENERAL MEETING

I/We

Appoint

being a Member of Midas Resources Limited entitled to attend and vote at the Meeting, hereby Name of proxy OR

Mark this box if you wish to appoint the Chairman of the Meeting as your proxy

or failing the person so named or, if no person is named, the Chairman of the Meeting or the Chairman‟s nominee, to vote in accordance with the following directions or, if no directions have been given, as the proxy sees fit at the Annual General Meeting to be held at 1:00 pm (WST), on 30 November 2011 at The Celtic Club, 48 Ord Street, West Perth, Western Australia and at any adjournment thereof.

Important for Resolutions 1, 4 & 5 if the Chairman of the Meeting is your proxy or is appointed as proxy by

default . By marking the box below, you are directing the Chairman of the Meeting to vote in accordance with the Chairman‟s voting intentions on these resolutions as set out in the Notice of Meeting. If you do not mark this box, and you have not directed your proxy how to vote, the Chairman of the Meeting will not cast you votes and your votes will not be counted in computing the required majority if a poll is called on these resolutions. If you appoint the Chairman of the Meeting as your proxy you can direct the Chairman how to vote by either marking the resolution boxes below or by marking this box (in which case the Chairman of the Meeting will vote in favour).

I/We direct the Chairman of the Meeting to vote in accordance with the Chairman’s voting intentions on Resolutions 1, 4 & 5 (except where I/we have indicated a different voting intention below).

I acknowledge that the Chairman of the meeting may exercise my proxy even though Resolutions 1, 4 & 5 are connected directly or indirectly with the remuneration of a member of key management personnel and/or even if the Chairman of the Meeting has an interest in the outcome of these items and that votes cast by the Chairman, other than those as proxy holder, would be disregarded because of that interest.

Voting on Business of the General Meeting	FOR AGAINST ABSTAIN	FOR AGAINST ABSTAIN	FOR AGAINST ABSTAIN	FOR AGAINST ABSTAIN
Resolution 1 – Adoption of the Remuneration Report
Resolution 2 – Re-election of Mr Terry Streeter
Resolution 3 – Re-election of Mr John Hopkins
Resolution 4 – Approval of grant of options to Mr John Hopkins
Resolution 5 – Remuneration of Non-executive Directors

If you mark the abstain box for a particular item, you are directing your proxy not to vote on that item on a show of hands or on a poll and that your shares are not to be counted in computing the required majority on a poll.

If two proxies are being appointed, the proportion of voting rights this proxy represents is

%

Signed this day of 2011

By:

By:	By:	By:
Individuals and joint holders Companies (affix common seal if appropriate)
Signature		Director
Signature		Director/Company Secretary
Notice of Annual General Meeting – November 2011 Page Signature	11	Sole Director and Sole Company Secretary

MIDAS RESOURCES LIMITED ABN 87 095 092 158

Instructions for Completing ‘Appointment of Proxy’ Form

A member entitled to attend and vote at a Meeting is entitled to appoint not more than two proxies to attend and vote on their behalf. Where more than one proxy is appointed, such proxy must be allocated a proportion of the member‟s voting rights. If the shareholder appoints two proxies and the appointment does not specify this proportion, each proxy may exercise half the votes.

1. A duly appointed proxy need not be a member of the Company. In the case of joint holders, all must sign.

2. Corporate shareholders should comply with the execution requirements set out on the Proxy Form or otherwise with the provisions of Section 127 of the Corporations Act. Section 127 of the Corporations Act provides that a company may execute a document without using its common seal if the document is signed by:

3. 2 directors of the company;

4. a director and a company secretary of the company; or

5. for a proprietary company that has a sole director who is also the sole company secretary – that director.

For the Company to rely on the assumptions set out in Section 129(5) and (6) of the Corporations Act, a document must appear to have been executed in accordance with Section 127(1) or (2). This effectively means that the status of the persons signing the document or witnessing the affixing of the seal must be set out and conform to the requirements of Section 127(1) or (2) as applicable. In particular, a person who witnesses the affixing of a common seal and who is the sole director and sole company secretary of the company must state that next to his or her signature.

1. Completion of a Proxy Form will not prevent individual shareholders from attending the Meeting in person if they wish. Where a shareholder completes and lodges a valid proxy form and attends the Meeting in person, then the proxy‟s authority to speak and vote for that shareholder is suspended while the shareholder is present at the Meeting.

2. Where a Proxy Form or form of appointment of corporate representative is lodged and is executed under power of attorney, the power of attorney must be lodged in like manner as this proxy.

To vote by proxy, please complete and sign the proxy form and send the proxy form:

• (a) by post to Midas Resources Limited PO Box 357 Subiaco

Western Australia, 6904;

• (b) deliver to the registered office of the Company at Level 1, 282 Rokeby Road, Subiaco, Western Australia, 6008; or

• (c) by facsimile to the Company on facsimile number (61 8) 9388 2600,

so that it is received not later than 1:00 pm (WST) on 28 November 2011.

Proxy forms received later than this time will be invalid.

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