HAMMER METALS LIMITED — Proxy Solicitation & Information Statement 2009

Sep 2, 2009

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MIDAS RESOURCES LIMITED ABN 87 095 092 158

NOTICE OF GENERAL MEETING AND EXPLANATORY STATEMENT

MEETING TO BE HELD 5 OCTOBER 2009

AT 10:00AM (WST)

AT THE CELTIC CLUB 48 ORD STREET WEST PERTH WESTERN AUSTRALIA

THIS IS AN IMPORTANT DOCUMENT. PLEASE READ IT CAREFULLY.

IF YOU ARE UNABLE TO ATTEND THE GENERAL MEETING, PLEASE COMPLETE THE PROXY FORM ENCLOSED AND RETURN IT IN ACCORDANCE WITH THE INSTRUCTIONS SET OUT IN THIS DOCUMENT.

MIDAS RESOURCES LIMITED NOTICE OF GENERAL MEETING

TIME AND PLACE OF MEETING AND HOW TO VOTE

Venue

The General Meeting of the Shareholders of Midas Resources Limited will be held at:

The Celtic Club 48 Ord Street West Perth, Western Australia

Commencing 10:00am (WST) on Monday, 5 October 2009

How to vote

You may vote by attending the meeting in person, by proxy or authorised corporate representative. A corporate representative form for this meeting and subsequent meetings is available upon request from the Company Secretary.

Voting in person

To vote in person, attend the meeting on the date and at the place set out above. The meeting will commence at 10:00 am (WST).

Voting by proxy

To vote by proxy, please complete and sign the proxy form enclosed with this notice of general meeting as soon as possible and either:

• return the proxy form by post to PO Box 356, Subiaco, Western Australia, 6904; or

• send the proxy by facsimile to the Company on facsimile number (08) 9388 2600 (International: + 61 8 9388 2600); or

• deliver to the registered office of the Company at Level 1, 282 Rokeby Road, Subiaco, Western Australia, 6008,

so that it is received not later than 10:00am (WST) on 3 October 2009.

Your proxy form is enclosed.

MIDAS RESOURCES LIMITED NOTICE OF GENERAL MEETING

MIDAS RESOURCES LIMITED ABN 87 095 092 158

NOTICE OF GENERAL MEETING

Notice is hereby given of a General Meeting of the Shareholders of Midas Resources Limited to be held at the Celtic Club, 48 Ord Street, West Perth, Western Australia on Monday, 5 October 2009 commencing at 10:00am (WST).

AGENDA

SPECIAL BUSINESS

RESOLUTION 1 – APPROVAL FOR THE ACQUISITION OF MULGA MINERALS PTY LTD FROM A RELATED PARTY

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

“That, for the purposes of Listing Rule 10.11 and for all other purposes, approval is given for the acquisition of Mulga Minerals Pty Ltd from David Donald Boyer as trustee for the DB Family Trust, a director of the Company, for consideration of 6,000,000 fully paid ordinary Shares in the capital of the Company plus $75,000 in cash on the terms and conditions set out in the Explanatory Statement accompanying and forming part of this Notice of Meeting.”

Short Explanation: Mulga Minerals Pty Ltd is owned by the DB Family Trust, a family trust of which Mr Don Boyer is the trustee. Mr Don Boyer is a director of the Company, and is a related party of the Company. Under Listing Rule 10.11 any issue of securities to a related party requires prior Shareholder approval, subject to certain exceptions.

Voting Exclusion: For the purposes of Listing Rule 10.13.6, and for all other purposes, the Company will disregard any votes cast on this resolution by David Donald Boyer, and any of his associates. However, the Company need not disregard a vote if:

• (a) it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or

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

By order of the Board

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Phillip MacLeod Company Secretary 3 September 2009

MIDAS RESOURCES LIMITED EXPLANATORY STATEMENT

EXPLANATORY STATEMENT

This Explanatory Statement is provided to supply Shareholders with information to enable them to make an informed decision regarding the Resolution set out in the Notice of General Meeting. This Explanatory Statement is to be read in conjunction with and forms part of the Notice of General Meeting, for the meeting to be held at 10:00am (WST) on Monday, 5 October 2009 at The Celtic Club, 48 Ord Street, West Perth, Western Australia, 6005. Capitalised terms in the Notice and in this Explanatory Statement are defined in the Glossary.

1. THE RESOLUTION

Resolution 1 – Approval for acquisition of Mulga Minerals Pty Ltd from a related party

Background

As announced to ASX on 29 June 2009, the Company entered into a Share Sale Agreement with David Donald Boyer as trustee for the DB Family Trust to acquire all the shares of Mulga Minerals Pty Ltd (“ Mulga ”). Mr Boyer is also a director of the Company and is a related party of the Company. The consideration for the acquisition of Mulga is the issue of 6,000,000 Shares and the payment of $75,000 in cash to the DB Family Trust. The Share Sale Agreement is subject to due diligence by the Company and Shareholder approval.

Mulga holds iron ore tenements in the Pilbara region of Western Australia as well as tenements with mineral sands potential. The Company has undertaken a review of the iron ore potential of the tenements and has identified a number of exploration targets that justify completing the acquisition of Mulga. The significant results from the due diligence review were reported to ASX on 5 August 2009.

Listing Rule 10.11

Listing Rule 10.11 requires the Company to obtain Shareholder approval by ordinary resolution prior to the issue of securities to the DB Family Trust because David Donald Boyer as trustee for the DB Family Trust is a related party of the Company.

Approval pursuant to Listing Rule 7.1 is not required in order to issue the Shares to the DB Family Trust, because approval is being sought under Listing Rule 10.11. Shareholders should note that the issue of securities to the DB Family Trust will not be included in the 15% calculation for the purposes of Listing Rule 7.1.

Listing Rule 10.13

For the purposes of Listing Rule 10.13, and for all other purposes, the following additional information is provided in relation to the Resolution:

• (a) the Shares will be allotted and issued in the name of DB Family Trust;

• (b) the Shares will be allotted and issued no later than one month after the date of this Meeting; (c) the Shares to be allotted and issued will rank equally with the existing Shares on issue; and

• (d) no funds will be raised from the issue of 6,000,000 Shares, because they will be issued in satisfaction of the acquisition of Mulga.

MIDAS RESOURCES LIMITED EXPLANATORY STATEMENT

In the 12 months prior to the date of this Notice, the highest and lowest closing trading price of the Shares on ASX was $0.062 on 12 September 2008 and $0.016 on 24 June 2009. The last available closing price of the Shares on ASX prior to the date of this Notice was $0.04 on 2 September 2009.

The deemed issue price of the Shares is $108,000 based on the closing price of $0.018 per Share on the date of the Share Sale Agreement and $240,000 based on the last available closing price referred to above. There is a financial benefit that accrues to David Donald Boyer as trustee for the DB Family Trust on the sale of the Shares only if the Shares are sold at a price higher than the deemed issue price. Notwithstanding this, the Directors excluding Mr Boyer have formed the view that the transaction is on arms length terms. Each of the other Directors, who have no interest the Resolution, consider that an acquisition consideration of 6,000,000 Shares plus $75,000 in compensation for past costs associated with identifying and acquiring the Mulga tenements is commercially reasonable in light of the due diligence results and the value of the consideration Shares at the time of entering into the Share Sale Agreement and the value of those Shares at the date of this Notice of Meeting. The Directors, other than Mr Boyer, therefore recommend that Shareholders vote in favour of the resolution.

Mr Boyer declined to make a recommendation to Shareholders in relation to the issue of Shares and payment of cash for acquisition of Mulga because he has a material personal interest in the outcome of Resolution 1.

If Shareholders approve the issue of Shares to the DB Family Trust the effect will be to dilute the shareholding of existing Shareholders. A total of 6,000,000 Shares will be allotted and issued to the DB Family Trust. This will increase the number of Shares on issue from 225,976,261 to 231,976,261 with the effect that the shareholding of existing Shareholders will be diluted by approximately 2.6% (based on the Company’s undiluted capital structure at the date of this Notice);

The direct and indirect shareholding interests of the Directors in Shares in the Company are set out in the table below:

elow:
Director	% of Shares on issue at	% of Shares on issue (including Shares
	date of Notice	the subject of the Resolution)
D Boyer	6.11%	8.54%
T Streeter	19.03%	18.54%
G Balfe	0.38%	0.37%

The Directors are not aware of any other information that would be reasonably required by Shareholders to allow them to make a decision whether it is in the best interests of the Company to pass the Resolution.

Please contact the Company Secretary on (08) 9388 2211 with any queries.

MIDAS RESOURCES LIMITED EXPLANATORY STATEMENT

GLOSSARY

ASX means ASX Limited.

Board means the board of directors of the Company.

Company means Midas Resources Limited (ABN 87 095 092 158).

Corporations Act means the Corporations Act 2001 (Cth).

Directors means the directors of the Company.

Explanatory Statement means the explanatory statement to the Memorandum.

Listing Rules means the Listing Rules of ASX.

Meeting means the general meeting convened by the Notice.

Notice means this notice of general meeting.

Resolution means the resolution contained in the Notice.

Share means a fully paid ordinary share in the capital of the Company.

Shareholder means a holder of Shares.

Share Sale Agreement means the Share Sale Agreement Mulga Minerals Pty Ltd dated 26 June 2009 between David Donald Boyer as trustee for the DB Family Trust, Midas Resources Limited and Mulga Minerals Ltd.

WST means Western Standard Time.

VOTING AND PROXIES

1. A Shareholder entitled to attend and vote at a general meeting of Shareholders is entitled to appoint not more than two proxies. Where more than one proxy is appointed, each proxy must be appointed to represent a specified proportion of the Shareholder’s voting rights. If the Shareholder appoints two proxies and the appointment does not specify this proportion, each proxy may exercise half of the votes. A proxy need not be a Shareholder of the Company.

2. Where a voting exclusion applies, the Company need not disregard a vote if it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form or it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

3. In accordance with Regulation 7.11.37 of the Corporations Regulations 2001, the Directors have set a time to determine the identity of those entitled to attend and vote at the Meeting. The time is 5:00pm (WST) on 2 October 2009.

4. A proxy form is attached. If required it should be completed, signed and returned to the Company’s registered office in accordance with the instructions on that form.

PROXY FORM

APPOINTMENT OF PROXY MIDAS RESOURCES LIMITED ABN 87 095 092 158

GENERAL MEETING

I/We

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

Appoint

Name of 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 a General Meeting to be held at The Celtic Club, 48 Ord Street, West Perth, Western Australia, on Monday, 5 October 2009 at 10:00am (WST) and at any adjournment thereof. If no directions are given, the Chairman will vote in favour of all of the resolution.

Voting on Business of the General Meeting

RESOLUTION FOR AGAINST ABSTAIN

Issue of Shares to DB Family Trust

OR

In relation to the Resolution, if the Chairman is to be your proxy and you do not wish to direct your proxy how to vote on the Resolution, please place a mark in this box

By marking this box, you acknowledge that the Chairman of the meeting may exercise your proxy even if he has an interest in the outcome of the Resolution and that votes cast by him other than as proxy holder will be disregarded because of that interest. 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 your votes on the Resolution and your votes will not be counted in computing the required majority if a poll is called on the Resolution.

IF THE CHAIRMAN IS TO BE YOUR PROXY IN RELATION TO THE RESOLUTION YOU MUST EITHER MARK THE BOX DIRECTING YOUR PROXY HOW TO VOTE OR MARK THE BOX INDICATING THAT YOU DO NOT WISH TO DIRECT YOUR PROXY HOW TO VOTE, OTHERWISE THIS APPOINTMENT OF PROXY WILL BE DISREGARDED.

If you mark the abstain box, 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.

Signed this day of 2009

By:

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Individuals and joint holders Companies (affix common seal if appropriate)
Signature Director
Signature Director/Company Secretary
Signature Sole Director and Sole Company Secretary
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Instructions for Completing ‘Appointment of Proxy’ Form

1. 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.

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

3. 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:

4. 2 directors of the company;

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

6. 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.