MINDAX LIMITED — Annual Report 2013

Oct 6, 2013

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ANNUAL REPORT 2012 2013

BUILDING MOMENTUM > THROUGH PERFORMANCE

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IRON ORE GOLD

URANIUM COPPER

CORPORATE DIRECTORY

DIRECTORS

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Gilbert George Stephen Ward Andrew Tsang Benjamin Chow Kgai Mun Loh Yonggang Li

(Non-executive Chairman)

(Managing Director and Chief Executive Offi cer) (Non-executive Director) (Non-executive Director) (Non-executive Director) (Non-executive Director)

COMPANY SECRETARY AND CHIEF FINANCIAL OFFICER

Australian Company Number 106 866 442

Christopher Pougnault

DOMICILE AND COUNTRY OF INCORPORATION

Australia

PRINCIPAL AND REGISTERED OFFICE

Level 2, 25 Richardson Street West Perth WA 6005

PO Box 92 West Perth WA 6872

Telephone (08) 9485 2600 Facsimile (08) 9485 2500 Email info@mindax.com.au

WEBSITE

www.mindax.com.au

AUDITORS

BDO Audit (WA) Pty Ltd 38 Station Street Subiaco WA 6008

SHARE REGISTRY

Advanced Share Registry Services 150 Stirling Highway Nedlands WA 6009 Website: www.advancedshare.com.au

BANKERS

Commonwealth Bank 1254 Hay Street West Perth WA 6005

Westpac Banking Corporation 465 Scarborough Beach Road Osborne Park WA 6017

STOCK EXCHANGE LISTING

Shares in Mindax Limited are quoted on the Australian Securities Exchange. ASX code: MDX (fully paid ordinary shares)

CONTENTS

Chairman’s Report	2
Message from Managing Director and CEO	3
2013 Highlights	4
Corporate Overview	6
Corporate Governance Statement	8
Directors’ Report	16
Operations and Financial Review	24
Remuneration Report (Audited)	45
Auditor’s Independence Declaration	53
Directors’ Declaration	54
Independent Audit Report to the Members of Mindax Limited	55
Consolidated Statement of Prof t and Loss and
Other Comprehensive Income for the Year Ended 30 June 2013	57
Consolidated Balance Sheet as at 30 June 2013	58
Consolidated Statement of Changes in Equity
for the Year Ended 30 June 2013	59
Consolidated Statement of Cash Flows
for the Year Ended 30 June 2013	60
Notes to the Consolidated Financial Statements	61
Additional Information for Listed Public Companies	92

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CHAIRMAN’S REPORT

Dear Shareholder,

The 2012/13 year has been one of considerable progress in a stable Corporate environment for Mindax, subsequent to the events which occupied the Company in the last half of 2011/12.

CORPORATE

In July 2012,the Company appointed Dr Stephen Ward as Managing Director and CEO. Mr John Stacpoole resigned as a non-executive director in August 2012 to take on a full time executive role elsewhere. The Board also welcomed Mr Yonggang Li as a nonexecutive director in April 2013.

During the year, Mindax successfully raised over $5.7 million to ensure its project portfolio – especially the key Mt Forrest Iron Ore Project - continued to advance.

This was an outstanding achievement given the diffi cult market experienced by junior companies in the exploration and mining sector.

Other important corporate highlights included the completion of a joint venture and farm-in arrangement for our Meekatharra North Gold Project, and the announcement of a Memorandum of Understanding for development of the Mt Forrest Project with Hong Kong – based Perpetual Mining Holding Limited (PMHL).

PROJECTS

The Mt Forrest Project remains the most advanced and important asset of the Company, and considerable progress has been made in terms of advancing the project. Once consummated, it is anticipated that the JV/farm-in agreement with PMHL will fully fund the project to the commencement of production of a small directshipping ore operation.

We continue to be an active member of the Yilgarn Iron Producers’ Association (YIPA) which has focussed closely on the proposed expansion of Esperance Port and related logistics infrastructure necessary for extra production from the Yilgarn.

The market for iron ore remains buoyant due to a weakening Australian dollar, continued strength in China, and the recovery of the German, Japanese and US economies. Recent announcements of deferral of some new projects in Western Australia, and longer than anticipated lead times for new projects in other countries will create more positive near term market dynamics. While there will be short term corrections, the medium term outlook for iron ore remains very positive.

The Meekatharra North Gold Project is fully funded until 2015 via a deferred farm-in/farmout arrangement with Messrs Zhensheng and Chenfei Zhuang; and our extensive exploration program resulted in the very encouraging intercepts announced on September 10 of this year. The results confi rm our view that the mineralized structures hosting Doray Minerals’ resource extend into Mindax’s tenements.

While the market for uranium continues to be aff ected by the aftermath of the Fukushima Tsunami and nuclear accident, Mindax has consolidated its uranium holdings, with drilling in July of this year confi rming the potential of the prospects in the Mukinbudin region. The longer term view of the nuclear power market is that it will continue be a signifi cant part of the energy mix especially as the move to reduce carbon intensive (oil and coal) fuels in the power generation industry gains momentum.

I would like to thank my fellow directors including Managing Director Steve Ward for their support during the year and particularly I would like to acknowledge the signifi cant contributions made by our dedicated and expert staff .

Finally, the ongoing support of our shareholders, as we move from explorer to producer, is very much appreciated.

Kind regards

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Gilbert George

Chairman

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MESSAGE FROM MANAGING DIRECTOR AND CHIEF EXECUTIVE OFFICER

I am delighted to provide some commentary for this Annual Report to Shareholders.

I am pleased to report that the Company has moved ahead and made some signifi cant progress with its projects at a time when fi nancial markets are very challenging for junior companies.

It has been very satisfying to carry out notable fi eld work on each of our key commodity projects. We have obtained a number of encouraging results which are covered in some detail in the annual fi nancial report.

The increased project work has been made possible by funds from successful capital raisings and from the new farm-in joint venture arrangement for our Meekatharra North Gold project. We are very appreciative of the fi nancial support we have received. I thank all our shareholders and strategic partners for their ongoing support.

The signing of a memorandum of understanding with Perpetual Mining Holding Limited of Hong Kong for a proposed joint venture for our fl agship Mt Forrest Iron Project has been a major event. Final negotiations for a formal joint venture agreement are in progress. A successful conclusion to these negotiations will be a ‘game changing’ event for the Company. The joint venture will fast track the Project to production and propel the Company to become one of the fi rst new iron ore producers in the Yilgarn region.

Looking forward to next year, our focus will remain on our existing projects. The results and developments from this year’s work provide us with more determination to drive each of the projects along the development pathway and in doing so create shareholder value.

I would like to express my thanks to the Board for their continued support and wise counsel. I would also like to acknowledge the small, but totally dedicated and loyal team of Mindax staff , consultants and contractors. We have a very

THE COMPANY HAS MOVED AHEAD AND MADE SOME SIGNIFICANT PROGRESS WITH ITS PROJECTS AT A TIME WHEN FINANCIAL MARKETS ARE VERY CHALLENGING FOR JUNIOR COMPANIES.

professional, expert and fl exible team who are very mindful of the need to control costs and spend money wisely and to great eff ect in these challenging times.

Finally, I must mention that we take our responsibilities under safety, environment and governance with the utmost priority. The launching of the new Sustainability Framework was an important step in this regard. It was also pleasing to report no lost time or medical treatment injuries and no environmental incidents for the year. Other matters are described in detail in other sections of this report.

Kind regards,

Steve Ward Managing Director and Chief Executive Offi cer

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HIGHLIGHTS

Sustainability > Sustainability framework launched. Safety management system updated. 1 N o lost time No lost time or medical treatment injuries to staff or contractors. No environmental incidents. 2 > Successful P r o e c t wo rk j capital raisings r amp e d up ~~4~~ Successful capital raisings [3] > Project work ramped up after period of in challenging fi nancial > markets. $5.7M obtained to fund company activities.

Project work ramped up after period of approximately 18 months of relative inactivity due to funding constraints and internal change. Field work undertaken on each of the four key commodity projects for iron ore, gold, uranium and copper. Several encouraging results.

5

$2.5 million funding secured

Joint Venture (deferred farm-in/farm-out arrangement) formed for the Meekatharra North Gold project. $2.5 million funding secured for next three years to advance the project.

P o t e ntt i a l 6 >

o t e ntt i a l Stability > MOU with Perpetual Mining Holding Limited (PMHL) of Hong Kong signed for potential joint venture > 7 for Mt Forrest Iron Project. PMHL completed due diligence and fi nal negotiations are in progress. Joint venture is designed to fast track the project to initial production and would be a signifi cant step forward. A p poo i ntm Good Corporate > 8

Corporate stability after period of considerable change.

A p poo i ntm en t s

Good Corporate Governance 9 >

New Managing Director & CEO appointed.

Continued focus on minimising costs and cost control and good Corporate Governance.

Please refer to the Operations and Financial Review section of the Directors’ Report for further details.

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CORPORATE OVERVIEW

THE COMPANY

Mindax Limited (Mindax or the Company) was listed on the ASX at the end of 2004 and is now in its ninth year of operation.

The Company headquarters is in Perth, Western Australia and has approximately 550 shareholders with 252 Million ordinary shares on issue.

The Company has four projects for key commodities iron ore, gold, copper and uranium. All projects are located in Western Australia.

Mindax’s strategy is to progress these projects along the development pathway ultimately to production and in doing so reward shareholders well.

The projects are at diff erent phases of development. The most advanced is the fl agship Mt Forrest Iron Project where a scoping study has been completed and is now being optimised. The Uranium Project is at a targeted exploration stage; with the Copper and Gold Projects being green fi eld exploration in nature.

The Company has an excellent track record as a minerals explorer. Through technically advanced exploration and an eye for detail, Mindax has successfully built a signifi cant portfolio of iron, uranium, copper and gold mineral exploration and mining tenements covering over 4,000 square kilometers. In addition, Mindax has applications in place for water and infrastructure covering over 2,400 square kilometers in support of the Mt Forrest Iron Project development.

Mindax has achieved a signifi cant iron discovery at Mt Forrest with a resource inventory now at 1.7 billion tonnes. Our uranium discovery near Mukinbudin in Western Australia is highly prospective and a maiden resource of 3.2 million pounds was announced in November 2011.

Following the successful phase of exploration in which the four key commodity projects were identifi ed, the Company is now focusing on development programs for each of these projects. This new phase of activity will require signifi cant

additional funds. The Company has been successful in raising funds on equity markets and via the formation of joint ventures for its projects with suitable strategic partners. Forward funding remains an area of particular focus.

PROJECT SUMMARY

Mindax’s has four projects for key commodities:

• 1 Mt Forrest Iron Project, which is located 165 km northwest of Menzies Western Australia. The iron resource stands at 1.7Bt (JORC inferred and indicated) comprising hematite, goethite, martite, micro-platy hematite and magnetite. The Company is in advanced discussions with Perpetual Mining Holding Limited (PMHL) of Hong Kong regarding the potential formation of a joint venture for this project.

• 2 The Yilgarn – Avon Joint Venture (YAJV) Uranium Project near Mukinbudin in the south west of WA is an area highly prospective for Uranium and an initial resource of 3.2 Million pounds (JORC Inferred) has been recorded. Mindax owns approximately 81% of the YAJV. Quasar, who operates the Beverley Uranium mine in South Australia, is the strategic partner.

• 3 The Meekatharra North Gold project which is 40 km to the north east of Meekatharra in Western Australia. The Company has highly prospective ground adjacent to Doray Minerals Andy Wells gold project which commenced operations in 2013. A joint venture (deferred farm-in/farm-out arrangement) for this project was formed in 2012 with strategic investors Messrs Zhuang.

• 4 The Mortlock Copper / Gold Project, which is located to the north of Northam in Western Australia and is is part of the YAJV with Quasar. Some tenements are also jointly owned by the YAJV and SIPA Resources Limited.

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CORPORATE GOVERNANCE STATEMENT

Corporate governance is the system by which companies are directed and managed. It infl uences how the objectives of the Company are set and achieved, how risk is monitored and assessed, and how performance is optimised. Good corporate governance structures encourage companies to create value (through entrepreneurism, innovation, development and exploration) and provide accountability and control systems commensurate with risks involved.

Good corporate governance will evolve with the changing circumstances of a company and must be tailored to meet these circumstances.

Mindax Limited (the Company or, including its subsidiaries, the Group) is a junior exploration company now transitioning to be a project developer and eventual producer. Its’ Board and management are committed to a high standard of corporate governance practices, ensuring that the Company and its’ subsidiaries comply with the Corporations Act 2001 (Commonwealth) (the Corporations Act), Australian Securities Exchange (ASX) Listing Rules, Company Constitution and other applicable laws and regulations.

At the present point in the Company’s corporate development, the ASX Corporate Governance Principles and Recommendations are likely to be implemented in stages as the Company evolves, given the size and simplicity of the business. The principles, recommendations and details of the current and evolving governance practices are identifi ed in the following pages.

PRINCIPLE 1: LAY SOLID FOUNDATIONS FOR MANAGEMENT AND OVERSIGHT

The relationship between the Board and senior management is critical to the Group’s long-term success. The directors are responsible to the shareholders for the performance of the Group in both the short and the longer term; and seek to balance sometimes competing objectives in the best interests of the Group as a whole. Their focus is to

enhance the interests of all shareholders and other key stakeholders and to ensure the Group is properly managed. To fulfi l this role, the Board is ultimately responsible for:

• providing strategic guidance to the Group including contributing to the development of, and approving the corporate strategy;

• reviewing and approving business plans, the annual budget and fi nancial plans including available resources and major capital expenditure initiatives;

• overseeing and monitoring:

• organisational performance and the achievement of the Group’s strategic goals and objectives;

• compliance with the Group’s codes of conduct;

• progress of major capital expenditures and other signifi cant corporate projects including any acquisitions or divestments;

• monitoring fi nancial performance including approval of the annual and half-year fi nancial reports and liaison with the Company’s auditors;

• appointment, performance assessment and, if necessary, removal of the Managing Director;

• ratifying the appointment and/or removal and contributing to the performance assessment for the members of the senior management team including the Chief Financial Offi cer and Company Secretary;

• ensuring there are eff ective management processes in place and approving major corporate initiatives

• enhancing and protecting the reputation of the organisation;

• overseeing the operation of the Group’s system for compliance and risk management reporting to shareholders;

• ensuring appropriate resources are available to senior management.

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BOARD MEMBERS POSSESS COMPLIMENTARY BUSINESS DISCIPLINES AND > EXPERIENCE ALIGNED WITH THE COMPANY OBJECTIVES. EXPERIENCE

Day to day management of the Group’s aff airs and the implementation of the corporate strategy and policy initiatives are the responsibility of the Managing Director and Chief Executive Offi cer (CEO). The Managing Director and CEO’s performance is reviewed annually by the other non-executive Board members. The Chairman is also responsible for administering an evaluation of Board performance on an annual basis.

PRINCIPLE 2: STRUCTURE THE BOARD TO ADD VALUE

The Board operates in accordance with the broad principles set out in its Board Charter (which was formally adopted on 16 August 2010). The charter details, amongst other things, the Board’s composition, roles, responsibilities and Board evaluation processes.

The Company has a six member Board comprising one executive director and fi ve non-executive directors, including the Chairman. The roles of Chairman and Managing Director are not combined. Four of the six directors reside in Australia, with two directors (Messrs Loh and Li) residing outside Australia. Mr Loh resides in Singapore and Mr Li in China.

The Group’s Managing Director & CEO, Dr Ward is not considered independent by virtue of his executive role in the Group, neither are Messrs George, Chow and Loh by virtue of fi nancial remuneration received as consultants during the previous four fi nancial years or post fi nancial year end. Mr Tsang is a substantial shareholder of the Company and is therefore not considered independent. Mr Li is not considered independent by virtue of the nature of his appointment, being nominated to the Board by three Mindax shareholders acting in association who control circa 19% of Mindax’s issued capital. The Board has considered its materiality threshold in light of the Company’s size and simplicity of the business and deemed it too small to have a majority of independent directors on the Board.

The full Board currently hold a number of scheduled meetings each year, plus strategy meetings and any extraordinary meetings at such other times as may be necessary to address signifi cant matters as they arise.

Standing Board meeting agenda items include the Managing Director/CEO’s report, fi nancial reports, strategic matters, governance, compliance and sustainability including ‘Environment, Health and Safety’ (EH&S).

Board members possess complimentary business disciplines and experience aligned with the Company objectives. The experience and qualifi cations of directors are noted in the Directors’ Report.

Where any director has a personal interest in a matter, the director is not permitted to be present during discussions or to vote on the matter. The enforcement of this requirement ensures that the interest of shareholders, as a whole, are pursued and not jeopardised by a lack of a majority of independent directors.

Where appropriate the Company will engage Board members as consultants to provide specialist input into Company matters.

Mr George acts as Chairman of the Company and while not satisfying the ‘independence test’ set out in the ASX’s Corporate Governance Principles and Recommendations, it is considered Mr George’s appointment is in the best interests of the Company and is without confl ict given its size.

The Board has formed the following subcommittees, membership of which consists of nonexecutive directors:

• a) Audit Committee (formed 2004) - currently comprising Messrs Loh, Chow and George;

• b) Nominations committee (formed 2010) - comprises Messrs Tsang, Chow and George; and

• c) Remuneration committee (formed 2004) - comprises Messrs Tsang, Chow and George.

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CORPORATE GOVERNANCE STATEMENT

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The objective and purpose of each committee is to support and advise the Board in fulfi lling its responsibilities to shareholders, corporate governance, and oversight responsibilities in relation to the company’s fi nancial reporting, internal control structure, external audit functions, recruitment of key management personnel (including directors) and monitoring levels of remuneration. In February 2013, the Board determined that operating two separate committees for Remuneration and Nominations was excessive and unnecessary; and as the membership of each of these committees was the same, the two committees were combined into a single Remuneration-Nominations Committee with eff ect 28 February 2013.

Details of the directors’ qualifi cations and attendance at such committee meetings are set out in the Directors’ Report.

New directors are provided with a letter of appointment setting out the Company’s expectations, their responsibilities, rights and the terms and conditions of their employment. All new directors participate in an induction programme which covers the operation of the Board and its committees and fi nancial, strategic, operations and risk management issues.

The Constitution of the Company notes that non-executive directors cannot hold offi ce for a period longer than three years without submitting themselves for re-election at the next relevant Annual General Meeting (AGM). One third of the non-executive directors must retire by rotation at each AGM together with any new directors appointed by the Board during the period since the last general meeting. Retiring directors are eligible to stand for re-election.

Each year the Board will also conduct an evaluation of its performance. The Chairman is responsible for administering such evaluation; with the last evaluation undertaken during the period May - June 2013.

PRINCIPLE 3: PROMOTE ETHICAL AND RESPONSIBLE DECISION MAKING

Code of conduct

The Company has developed a statement of values and a Code of Conduct (the Code) which has been endorsed by the Board and applies to all directors and employees. The Code was formally adopted in 2010 and updated in September 2012. The Code will be reviewed at least once every two years and updated as necessary to ensure it refl ects the highest standards of behaviour and professionalism and the practices necessary to maintain confi dence in the Group’s integrity and to take into account legal obligations and reasonable expectations of the Company’s stakeholders.

In summary, the Code requires that at all times all company personnel act with integrity, objectivity and in compliance with the letter and spirit of any applicable law, rule or regulation; together with the protocols, policies and procedures of the Group.

The Code requires employees who are aware of unethical practices within the Group or breaches of the Group’s policies to promptly report these using the Group’s whistle-blower programme. This can be done anonymously.

The Audit Committee reports directly to the Board on the compliance with the Code and has responsibility for the initial investigations for signifi cant issues raised under the whistle-blower programme.

Anti-bribery and Commissions Policy

Mindax has in place a formal policy on “Anti-bribery and Commissions Policy” which applies to all directors and employees and was formally adopted in September 2010.

Mindax believes that integrity and fair dealing are essential assets of the Group and this should be refl ected in all activities. Each director and employee has a responsibility to ensure that the Group will not get involved in corruption or dealing with unsanctioned commissions.

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Under the policy, no director or employee nor any other person representing the Group such as agents, suppliers, joint venture partners or others, may on any occasion, neither directly or indirectly, off er anything of value to any person that directly or indirectly represents a client or a supplier in order to gain an advantage or as a reward for a favour.

Dealing in Company Securities, Misuse of Price Sensitive Information and Insider Trading

Mindax has in place a formal policy on “Dealing in Company Securities, Misuse of Price Sensitive Information and Insider Trading” which applies to all directors and employees.

Any proposed trading in the Company’s securities by directors (other than the Managing Director), staff and other company offi cers is to be fi rstly advised to the Managing Director. The Managing Director must himself/herself advise the Chairman of any trade proposed by him/her. Once the Managing Director or Chairman (as applicable) has given approval, the relevant trade may be executed. Such policy clearly mitigates the risk of breaching the insider trading provisions and gives the Managing Director control to restrict trading if the Managing Director may be privy to sensitive information before the other Company offi cers and personnel are, or the Managing Director has knowledge that certain sensitive information (for example: exploration results) are due for receipt within a short term timeframe.

The Board may also impose trading bans at any time if it considers that as a consequence of any circumstances that have not been disclosed to the market, there is a risk that they or the Group’s employees or other company offi cers may trade inappropriately.

Group directors, staff and other company offi cers are prohibited from trading during the following ‘closed periods’:

• a) during the two week period immediately before the release of Mindax’s quarterly reports;

• b) two weeks immediately before the Company’s Annual General Meeting when it is customary

for the Chairman and Managing Director to provide further information about the Group’s current business activities; and

• c) not until after a reasonable amount of time has passed in respect of a market announcement that released what was price sensitive information, which was not previously available to the market, is released (generally two trading days, unless another period is considered appropriate by the Board).

Directors, offi cers and employees with any nonpublic sensitive information are prohibited from purchasing or disposing of Company securities, in accordance with the Corporations Act.

Directors must advise the Company of any transactions conducted by them in the securities of the Company, in accordance with the Corporations Act and ASX Listing Rules.

The Directors are satisfi ed that the Group has complied with its policies on ethical standards, including trading in securities.

Workplace Diversity

The Company values diversity and recognises the benefi ts it can bring to the organisation’s ability to achieve its goals. Accordingly the Group has developed and adopted a Diversity Policy. This policy outlines the Group’s diversity objectives in relation to gender, age, cultural background and ethnicity. It includes requirements for the Board to establish measurable objectives for achieving diversity and for the Board to assess annually both the objectives, and the Group’s progress in achieving them.

The Diversity Policy provides a framework for the Group to achieve:

• a) diverse and skilled workforce, leading to continuous improvement in service delivery and achievement of corporate goals;

• b) workplace culture characterised by inclusive practices and behaviours for the benefi t of all staff ;

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CORPORATE GOVERNANCE STATEMENT

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• c) improved employment and career development opportunities for women (noting that at 30 June 2013, 21% of Mindax’s employees were women);

• d) work environment that values and utilises the contributions of employees with diverse backgrounds, experiences and perspectives through improved awareness of the benefi ts of workforce diversity and successful management of diversity; and

• e) awareness in all staff of their rights and responsibilities with regards to fairness, equity and respect for all aspects of diversity.

In accordance with this policy and ASX Corporate Governance Principles, the Board will in due course establish measurable objectives in relation to diversity to monitor performance under the policy. At the present point in the Company’s corporate development, given current the size and simplicity of the business, establishing such objectives will be implemented in stages as the Company evolves; particularly when director and senior executive positions become vacant and appropriately skilled candidates are available. Currently, engagement of employees (including in senior roles) is based on an applicant’s skills, experience and ability to contribute to the Company in accordance with this policy.

PRINCIPLE 4: SAFEGUARD INTEGRITY IN FINANCIAL REPORTING

The Audit Committee is responsible for reviewing and reporting to the Board on the Group’s fi nancial reports and external audit processes.

The Managing Director and CEO, and Chief Financial Offi cer ordinarily provide a certifi cation to the Board on the integrity of the Company’s external fi nancial reports. The Managing Director and CEO, and Chief Financial Offi cer also provide additional certifi cation that the fi nancial statements are founded on sound risk management systems and that compliance and control systems are operating effi ciently and eff ectively in respect to fi nancial reporting risks.

The Board considers that risk management and internal compliance and control systems are suffi ciently robust for the Board to place reliance on the integrity of the fi nancial statements.

Audit processes and policies

As outlined above under Principle 2, the membership of the Audit Committee comprises Messrs Loh (Chair), George and Chow.

Details of the directors’ attendance at Audit Committee meetings are set out in the Directors’ Report. The Board is also ultimately responsible for the establishment and maintenance of a framework of internal control and appropriate ethical standards for the management of the Group.

The responsibilities include:

• Reviewing and approving statutory fi nancial reports and all other fi nancial information distributed externally;

• Monitoring the eff ective operation of the risk management and compliance framework;

• Reviewing the eff ectiveness of the Group’s internal control environment including compliance with applicable laws and regulations;

• The nomination of the external auditors and the review of the adequacy of the existing external audit arrangements;

• Considering whether non-audit services provided by the external auditor are consistent with maintaining the external auditor’s independence; and

• Review and monitor related party transactions and assess their propriety.

The minutes of all committee meetings are circulated to all directors.

The external auditor, BDO Audit (WA) Pty Ltd (BDO Audit) has engagement terms refreshed annually and has indicated its independence to the Board. BDO Audit were appointed as auditors in December 2003 and the Audit Partner in charge of the audit of the Group’s fi nancial reports is rotated regularly in accordance with BDO Audit’s quality control standards.

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MINDAX BELIEVES THAT INTEGRITY AND FAIR DEALING ARE ESSENTIAL ASSETS OF THE GROUP AND THIS SHOULD BE REFLECTED IN ALL ACTIVITIES. > INTEGRITY

PRINCIPLE 5 & 6: MAKE TIMELY AND BALANCED DISCLOSURES AND RESPECT THE RIGHTS OF SHAREHOLDERS

The Board adopts communications strategies and practices to promote communication with shareholders, in language capable of interpretation, and to encourage eff ective participation at General Meetings. The external auditor will attend the annual general meeting to respond to specifi c questions from shareholders relating to the conduct of the audit and the preparation and content of the auditor’s report.

As set out in the Company’s Continuous Disclosure Policy, the Company Secretary has been nominated as the person responsible for communications with the ASX. This role includes responsibility for ensuring compliance with the continuous disclosure requirements in the ASX Listing Rules. The Managing Director / CEO and Chairman are responsible for communication with analysts, brokers, shareholders, the media and the public.

The Board aims to ensure that shareholders are informed of all major developments aff ecting the Company’s state of aff airs. Information is communicated to shareholders as follows:

• electronic communication via the ASX website and the Company’s website; and

• notices of all meetings to shareholders.

The Board encourages full participation of shareholders at the General Meetings to ensure a high level of accountability and identifi cation with the Company’s strategy and goals. Important issues are presented to shareholders as single resolutions.

Shareholders are requested to vote on the appointment of directors, the granting of options and shares to directors and changes to the Constitution. Copies of the Constitution are available to any shareholder upon request and is also available for download from the Company’s website.

Timely and balanced disclosure

The Board supports the Australasian Investor Relations Association “Best Practice Guidelines for Communication between Listed Entities and the Investment Community”. The Board endorses a culture in favour of continuous disclosure and recognises the benefi ts of consistency to be achieved through a dedicated authorised spokesperson(s).

Information disclosed to the ASX is posted on the Company’s website as soon as it is disclosed to the ASX. When analysts are briefed on aspects of the Group’s operations, the material used in the presentation is released to the ASX and posted on the Company’s web site. Procedures have also been established for reviewing whether any price sensitive information has been inadvertently disclosed and, if so, this information is also immediately released to the market. Notably, continuous disclosure is discussed at all regular Board meetings and on an ongoing basis to support compliance.

The Group’s website also enables users to provide feedback and has an option for shareholders to register their email address for direct email updates on company matters.

The Group seeks to provide opportunities for shareholders to participate through electronic means. Initiatives to facilitate this include making all Company announcements, media briefi ngs, details of Company meetings, press releases for the last three years and fi nancial reports for the last fi ve years available on the Company’s website.

PRINCIPLE 7: RECOGNISE AND MANAGE RISK

The Group has identifi ed material business risks associated with its day-to-day operations and the possible impacts on the Group as a consequence. This is recorded in the Group’s internal register and is continuously being developed and updated. The Group aims to review its’ risk management policies on a six monthly basis to mitigate material risks

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CORPORATE GOVERNANCE STATEMENT

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identifi ed from eventuating and to ensure a sound internal control system is in place; with the last review undertaken during the period May - June 2013. The Managing Director and CEO and Company Secretary are required to report to the Board if any material business risks that signifi cantly impact on the business have arisen since the last Board meeting and if an eff ective internal control policy is in place and has been followed (as applicable). The Board declares that a sound and eff ective risk management and internal control system had been adhered to and operated during the fi nancial year ended 30 June 2013.

In summary, the Group’s internal risk management policies are designed to ensure strategic, operational, legal, reputational and fi nancial risks are identifi ed, assessed, eff ectively and effi ciently managed and monitored to enable achievement of the Group’s business objectives.

The Remuneration-Nominations Committee advises the Board on remuneration and incentive policies and practices generally and makes specifi c recommendations in relation to compensation arrangements for executive and non-executive directors and in respect of all equity based remuneration plans. Ultimate responsibility for the Company’s remuneration policy rests with the full Board.

The remuneration policy states that executive directors may participate in share option schemes with the prior approval of shareholders. Other executives may also participate in employee share option schemes, with any option issues normally being made in accordance with thresholds set in plans approved by shareholders. The Board however, considers it appropriate to retain the fl exibility to issue options to executives outside of approved employee option plans in appropriate circumstances.

The Managing Director and CEO and the Chief Financial Offi cer have provided additional certifi cation that the fi nancial statements are founded on sound risk management systems and that compliance and control systems are operating effi ciently and eff ectively in respect to fi nancial reporting risks.

Considerable importance is placed on maintaining a strong control environment. The organisation has been structured in a way to clearly draw lines of accountability and delegation of authority. The Board actively promotes a culture of quality and integrity.

Information on directors’ and executives’ remuneration, including principles used to determine remuneration, is set out in the Directors’ Report under the ‘Remuneration Report’. In accordance with remuneration policy, participants in equity-based remuneration plans are not permitted to enter into any transactions that would limit the economic risk of options or other unvested entitlements.

Each member of the senior executive team signs a formal employment agreement at the time of their appointment covering a range of matters including their duties, rights, responsibilities and any entitlements on termination. The standard agreement refers to a specifi c formal job description.

PRINCIPLE 8: REMUNERATE FAIRLY AND RESPONSIBLY

As outlined under Principle 2 above, the membership of the Remuneration-Nominations Committee comprises of Messrs Chow (Chair), George and Tsang.

Details of these directors’ attendance at Remuneration-Nominations Committee meetings are set out in the Directors’ Report.

The Remuneration-Nominations Committee also assumes responsibility for overseeing management succession planning, including the implementation of appropriate executive development programmes and ensuring adequate arrangements are in place, so that appropriate candidates are recruited for senior positions.

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ACCESS TO PROFESSIONAL ADVICE BY THE BOARD AND COMMITTEES

Issues of substance are considered by the appropriate Board sub-committee and the Board with external advice from its professional advisers as required. The Board’s individual members can also seek independent professional advice at the Company’s expense in carrying out their duties, subject to the Chairman approving the terms of such external advice.

SUMMARY

Mindax Limited has adopted the following policies and charters:

• Board Charter;

• Code of Conduct;

• Anti-bribery and Commissions Policy

• Securities Trading Policy;

• Diversity Policy; Continuous Disclosure Policy;

• Shareholder Communication Policy;

• Audit Committee Charter;

• Remuneration Committee Charter; and a

The Company is non-compliant with the ASX Corporate Governance Principles and Recommendations with respect to the following:

• the majority of directors of the Board are not considered independent - for reasons stated under Principle 2: ‘Structure The Board To Add Value’.

• the establishment of measurable objectives in relation to diversity – for the reasons stated under ‘Workplace Diversity’ under Principle 3: ‘Promote Ethical And Responsible Decision Making’

Other corporate practices are compliant with the ASX Corporate Governance Principles and Recommendations and are subject to regular review. Your directors present their report for the fi nancial year ended 30 June 2013.

The names of the directors in offi ce at any time during, or since the end of, the year are set out in the table below. Directors have been in offi ce since the start of the fi nancial year to the date of this report unless otherwise stated.

• Nominations Committee Charter.

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DIRECTORS’ REPORT

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NAME POSITION APPOINTED/
RESIGNED
Gilbert George Non executive
Chairman
Stephen Ward Managing (appointed
Director and Chief 30 July 2012)
Executive Offi cer
Andrew Tsang Non executive
Director
Benjamin Chow Non executive
Director
Kgai Mun Loh Non executive
Director
Yonggang Li Non-executive (appointed
Director 18 April 2013)
John Stacpoole Non executive (resigned
Director 20 August 2012)
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The names of the company secretaries in offi ce at any time during, or since the end of, the year are:

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NAME POSITION APPOINTED/
RESIGNED
Christopher Company Secretary
Pougnault and Chief Financial
Offi cer
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EVENTS SUBSEQUENT TO REPORTING DATE

CONVERTIBLE NOTE

On 21 August 2013 the Company issued a Convertible Note for $600,000 to Ms Lai You, an existing shareholder of the Company and related party to non-executive director, Mr Andrew Tsang. The terms and conditions of the Note are as follows:

• The Note is unsecured.

• The Note will not convert and it will be a condition precedent to its conversion into Shares that shareholder approval to its conversion be obtained as soon as practicable following the issue of the Note and in any event by not later than the Company’s 2013 Annual General Meeting.

• The Note shall convert into ordinary fully paid shares at an issue price of $0.12 per share, immediately following the meeting at which shareholders approve the conversion.

• No interest will be payable on the Note unless shareholder approval to the conversion of the Note is not obtained on or before the Company’s 2013 Annual General Meeting.

• Interest applicable (in the event of non-approval by shareholders) will accrue at the rate of 9% per annum, capitalised monthly from the date of issue of the Note until the date the Note is repaid.

• If not converted the face value of the Note is to be repaid on 31 January 2014.

TENEMENT RELINQUISHMENTS

PRINCIPAL ACTIVITIES

During the year, the Group’s principal activity was mineral exploration, which included project development studies.

SIGNIFICANT CHANGES IN STATE OF AFFAIRS

No signifi cant changes in the Group’s state of aff airs occurred during the fi nancial year other than as noted above under principal activities and in the Operations and Financial Review, commencing on page 24.

The partners of the YAJV, along with Sipa Exploration NL, determined that the following tenements associated with the Mortlock Project were no longer prospective and were relinquished by the Company on 9 September 2013. The capitalised exploration expenditure associated with these tenements has also been written off by the Company for fi nancial year end purposes:

• E70/3480, E70/3481, E70/2518, E70/2519 and E70/2521

Other than disclosed above there are no other matters or circumstances that have arisen since the end of the fi nancial year which signifi cantly aff ected or could signifi cantly aff ect the operations of the Group, the results of those operations or the state of aff airs of the Group in future fi nancial years.

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INFORMATION ON DIRECTORS

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GILBERT GEORGE NON EXECUTIVE CHAIRMAN
EXPERIENCE
Gilbert joined the Board in 2004 in a non executive capacity and is
the Chairman of the Board.
Gilbert, aged 63 years, has an honours degree in Agricultural
Science, as well as a Masters Degree in Economics from a
prestigious Japanese university. After working in Australia and
Japan in Government positions, Gilbert established his own
business development consultancy in 1988.
He is the principal of Gilbert George & Associates Pty Ltd which
has provided strategic advice to companies in Australia, Africa,
Japan, the US and Europe and been involved in over $950
million of new investment in Australia, in the resource, IT, food
processing and service sectors. Resource experience includes gold,
manganese, oil and heavy mineral sands.
He holds directorships in the following unlisted companies: Bedley
Holdings Pty Ltd, Ocean Power Technologies (Australasia) Pty Ltd
and Governor Holdings Pty Ltd. Gilbert has also been a member
of a number of charities and state government and international
advisory committees, including Anglicare and the Asian Round
Table.
INTEREST IN SHARES AND OPTIONS 4,311,413 ordinary shares in Mindax Limited.
AS AT 19 SEPTEMBER 2013
1,000,000 options exercisable at $0.11 each, expiring 10 December
2015.
SPECIAL RESPONSIBILITIES Gilbert is a member of the Audit and Remuneration-Nominations
Committees.
DIRECTORSHIPS HELD IN OTHER Non-executive Chairman of Metals of Africa Limited
LISTED ENTITIES DURING THE THREE (appointed 1 August 2012).
YEARS PRIOR TO THE CURRENT
YEAR
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DIRECTORS’ REPORT

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STEPHEN WARD MANAGING DIRECTOR AND CHIEF EXECUTIVE OFFICER

EXPERIENCE	Stephen (Steve) joined the Board as its Managing Director on 30 July
	2012 and is also the Company’s CEO.
	Steve, aged 58 years, is a graduate from the University of Nottingham;
	BSc Chemistry (1976); PhD in Physical Chemistry (1979) and is a graduate
	of the Australian Institute of Company Directors (GAICD).
	Steve gained 20 years broad experience with Titanium pigment producer
	Tioxide Group Ltd (formerly a subsidiary of ICI and now Huntsman
	Pigments) where he worked in production, operational, engineering
	and technical roles at the Australian production facility. He became
	the inaugural General Manager responsible for the development and
	start-up of Tioxide’s manufacturing facilities in Malaysia in the early
	1990’s. He subsequently moved to business management roles based
	in the United Kingdom and became an executive director of the global
	company with general management responsibility for the European,
	Middle East and Southern Africa business unit.
	He then spent 7 years with Australian publicly listed minerals sands
	producer Iluka Resources Limited where he was President of the USA
	mining and processing operations and global Executive General Manager
	responsible for sales, marketing and business development.
	He then formed his own consulting business providing services to the
	resources and chemicals industries.
	Steve subsequently joined Cristal, a Saudi Arabian based global titanium
	pigment producer as senior Vice-President Strategy and Development
	for a 3 year period.
	Steve was appointed a non-executive director of Arafura Resources
	Limited in 2007 before he became Managing Director and CEO at
	the beginning of 2010. He left Arafura earlier in 2012 as part of a
	restructuring programme to pursue other opportunities.
INTEREST IN SHARES AND	4,000,000 options exercisable at $0.108 each, expiring 9 November
OPTIONS AS AT 19 SEPTEMBER	2015.
2013
SPECIAL RESPONSIBILITIES	None.
DIRECTORSHIPS HELD IN OTHER	Managing Director of Arafura
LISTED ENTITIES DURING THE	Resources Limited (resigned 16
THREE YEARS PRIOR TO THE	February 2012).
CURRENT YEAR

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ANDREW TSANG NON EXECUTIVE DIRECTOR
EXPERIENCE Andrew joined the Board in 2008 in a non executive capacity.
Andrew, aged 57 years, is a naturalised Australian citizen who was born
and educated in China and who has successfully established and run
construction, engineering and property development businesses both in
China and Australia as well as establishing successful import agencies
for Australian manufactured goods into China.
INTEREST IN SHARES AND 48,139,543 ordinary shares in Mindax Limited.
OPTIONS AS AT 19 SEPTEMBER 500,000 options exercisable at $0.11 each, expiring 10 December 2015.
2013
SPECIAL RESPONSIBILITIES Andrew is a member of the Remuneration-Nominations Committee.
DIRECTORSHIPS HELD IN OTHER Andrew is also a non-executive director of the listed company Diatreme
LISTED ENTITIES DURING THE Resources Limited (since 23 January 2009).
THREE YEARS PRIOR TO THE
CURRENT YEAR
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BENJAMIN CHOWNON EXECUTIVE	DIRECTOR
EXPERIENCE	Benjamin joined the Board in 2009 in a non executive capacity.
	Benjamin, aged 67 years, is a distinguished Australian citizen who
	was born and educated in China, emigrating to Australia in 1962. He
	has a business background in engineering, property development and
	leadership in the Chinese and Australian f nancial sectors.
	He chaired the Council for Multicultural Australia which assists the
	Australian Government implement its multicultural policies. He has
	previously served as President of Australian Chinese Community
	Association of NSW, President of Chinese Australian Forum of NSW
	and Vice-president of the Ethnic Communities Council of NSW. He
	is a past member of the Council of National Museum of Australia, a
	member of the Bond University Council, President of Sydney University
	Nerve Research Foundation, a Trustee and immediate past Chairman of
	Australian Chinese Charity Foundation and a Director of Chain Reaction
	Foundation Ltd.
INTEREST IN SHARES AND	196,000 ordinary shares in Mindax Limited.
OPTIONS AS AT 19 SEPTEMBER	500,000 options exercisable at $0.11 each, expiring 10 December 2015.
2013
SPECIAL RESPONSIBILITIES	Benjamin is a member of the Audit Committee and Chair of the
	Remuneration-Nominations Committee.
DIRECTORSHIPS HELD IN OTHER	Benjamin was a Non-executive Director of the listed company Invocare
LISTED ENTITIES DURING THE	Limited for the period 22 February 2007 to 16 August 2013.
THREE YEARS PRIOR TO THE
CURRENT YEAR

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DIRECTORS’ REPORT

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KGAI LOHNON EXECUTIVE DIRECTOR	KGAI LOHNON EXECUTIVE DIRECTOR
EXPERIENCE	Kgai (known as Eric) joined the Board in 2012 in a non-executive capacity.
	Eric is the Executive Director of Lion Asiapac Limited, a company listed
	on the Singapore Exchange, since August 2008. Lion Asiapac is a
	substantial shareholder of the Company.
	He has a wealth of management experience including listed companies
	with multi-national operations. He has also been involved in strategic
	planning and has spearheaded numerous merger and acquisition
	projects.
	Prior to 2008, he was the Group General Manager of Lion Asiapac
	Limited and oversaw operational, f nancial and management matters of
	the Lion Asiapac Group.
	In 1998, Eric joined the Lion Group as the Financial Controller of the
	Group’s telecommunications business unit. Concurrently, he also
	headed their internal audit and group information systems divisions in
	Singapore.
	Eric holds a Master’s Degree in Business Administration from the
	Edinburgh University Management School and is an Associate Member
	of the Institute of Chartered Accountant’s in England and Wales.
INTEREST IN SHARES AND	500,000 options exercisable at $0.11 each, expiring 10 December 2015.
OPTIONS AS AT 19 SEPTEMBER
2013
SPECIAL RESPONSIBILITIES	Eric is the Chairman of the Audit Committee.
DIRECTORSHIPS HELD IN OTHER	Executive Director since August 2008 of Lion Asiapac Limited, listed on
LISTED ENTITIES DURING THE	the Singapore Stock Exchange.
THREE YEARS PRIOR TO THE
CURRENT YEAR

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YONGGANG LI NON-EXECUTIVE DIRECTOR

EXPERIENCE Yonggang was appointed to the Board on 18 April 2013 in a nonexecutive capacity. Yonggang, aged 37 years, graduated in Electronic Accounting from Hebei Economic and Trade University in 1999. From 1999 to 2001 he was the accountant and auditor for Zheng Xiang Accounting Firm Hebei province. In 2001 he jointly established the Hebei Zhuxin Construction Company and was previously the Chairman. In 2003 he jointly established the Shijiazhuang Zhengqian Construction Installation Engineering Company Ltd and the Hebei Jiangtai Construction Installation Engineering Company Ltd. He was previously the Chairman of both boards of directors. In 2005 he joined with others to acquire Luanping Jinhuifeng Mining Company Ltd and was previously the Chairman. In 2010 Yonggang jointly established Huihua Huimei Investment (Beijing) Company Ltd and is the current Chairman. In 2011 he acquired a private mining company for dolomite iron ore in Xiaoying Village Luanping County. The company currently extracts 500,000 tonnes of 63% vanadium and titanium ore concentrate. INTEREST IN SHARES AND Nil. OPTIONS AS AT 19 SEPTEMBER 2013 SPECIAL RESPONSIBILITIES None.

DIRECTORSHIPS HELD IN OTHER None. LISTED ENTITIES DURING THE THREE YEARS PRIOR TO THE CURRENT YEAR

JOHN STACPOOLE FORMER NON EXECUTIVE DIRECTOR

EXPERIENCE John was appointed to the Board in a non-executive capacity on 27 April 2012 and resigned on 20 August 2012 to take up a new full time executive role with a major contractor involved in the Iron Ore sector. His resignation was tendered to enable him to focus fully on his new role and ensure no personal confl ict of interest arose. INTEREST IN SHARES AND Nil. OPTIONS AS AT 20 AUGUST 2012 SPECIAL RESPONSIBILITIES Nil. DIRECTORSHIPS HELD IN OTHER None. LISTED ENTITIES DURING THE THREE YEARS PRIOR TO THE CURRENT YEAR

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DIRECTORS’ REPORT

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INFORMATION ON THE COMPANY SECRETARY

CHRISTOPHER POUGNAULT COMPANY SECRETARY

EXPERIENCE	Christopher is a Chartered Accountant with over 20 years experience,
	working in areas including organisational strategy & operations, banking
	& f nance, as well as corporate reconstruction of ASX listed companies.
	Christopher’s broad range of professional and industry experience,
	including the mining and exploration sector, has provided him with an
	extensive understanding of business operations, f nancial management,
	commercial analysis and operational excellence.
	His previous positions include senior appointments at Deloitte and
	Pitcher Partners.
	Christopher holds a Bachelor of Commerce, Accounting and Corporate
	Administration from Curtin University of Technology.
	Christopher is also a member of Chartered Secretaries Australia (CSA)
	and has completed the CSA’s Certif cate in Governance Practice.
	Christopher is also the Chief Financial Of cer of the Mindax Group.
INTEREST IN SHARES AND	200,000 ordinary shares in Mindax Limited.
OPTIONS AS AT 19 SEPTEMBER	500,000 options exercisable at $0.45 each, expiring 30 September 2013.
2013	500,000 options exercisable at $0.60 each, expiring 30 September 2014.

MEETINGS OF DIRECTORS

During the fi nancial year, 16 meetings of directors (including committees of directors) were held. Attendances by each director during the year were as follows:

	BOARD	MEETINGS	AUDIT	COMMITTEE	REMUNERATION AND NOMINATION COMMITTEE	REMUNERATION AND NOMINATION COMMITTEE
	Number eligible to attend	number attended	number eligible to attend	number attended	number eligible to attend	number attended
Gilbert George	11	11	2	2	3	3
Stephen Ward	10	10	n/a	n/a	n/a	n/a
Andrew Tsang	11	11	n/a	n/a	3	3
Benjamin Chow	11	11	2	2	3	3
Kgai Mun Loh	11	9	2	2	n/a	n/a
Yonggang Li	2	2	n/a	n/a	n/a	n/a
John Stacpoole	1	1	n/a	n/a	n/a	n/a

There were also thirteen (13) circular resolutions passed by the Board of Directors during the fi nancial year.

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RETIREMENT, ELECTION AND CONTINUATION IN OFFICE OF DIRECTORS

Mr Tsang retires by rotation in accordance with clause 13.2 of the Company’s Constitution, and being eligible, off ers himself for re-election.

Mr Chow retires by rotation in accordance with clause 13.2 of the Company’s Constitution, and being eligible, off ers himself for re-election.

INDEMNIFYING OFFICERS OR AUDITORS

The Group has paid premiums to insure directors against liabilities for costs and expenses incurred by them in defending legal proceedings arising from their conduct while acting in the capacity of director of the Group, other than conduct involving a wilful breach of duty in relation to the Group.

Mr Yonggang Li, who was appointed to the Board on 18 April 2013, and being eligible, off ers himself for re-election pursuant to clause 13.4 of the Company’s Constitution.

OPTIONS

At the date of this report, the unissued ordinary shares of Mindax Limited under option, including those options issued during the year and since 30 June 2013 to the date of this report, are as follows:

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GRANT DATE DATE OF EXPIRY EXERCISE PRICE $ NUMBER UNDER
OPTION
11 October 2011 30 September 2013 0.45 1,100,000
11 October 2011 30 September 2014 0.60 1,100,000
1 May 2012 31 May 2015 0.35 2,321
9 November 2012 9 November 2015 0.108 4,000,000
10 December 2012 10 December 2015 0.11 2,500,000
Total 8,702,321
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During the year ended 30 June 2013, 4 ordinary shares of Mindax Limited were issued on the exercise of options granted to shareholders.

During the year ended 30 June 2013, the following options over ordinary shares in Mindax Limited expired or lapsed without exercise:

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GRANT DATE DATE OF EXPIRY/ EXERCISE PRICE $ NUMBER UNDER
LAPSED OPTION
4 August 2008 1 August 2012 0.53 250,000
12 October 2009 12 October 2012 0.48 300,000
11 October 2011 31 May 2013 0.60 650,000
11 October 2011 31 May 2013 0.45 650,000
Total 1,850,000
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OPERATIONS AND FINANCIAL REVIEW

PROCEEDINGS ON BEHALF OF COMPANY

No person has applied for leave of Court to bring proceedings on behalf of the Group or intervene in any proceedings to which the Group is a party for the purpose of taking responsibility on behalf of the Group for all or any part of those proceedings.

The Group was not a party to any such proceedings during the year.

NON AUDIT SERVICES

No non-audit advice was received during the 2012 – 2013 fi nancial year. During the 2011 – 2012 fi nancial year specialist taxation advice was provided to the Group by partners of BDO Corporate Tax (WA) Pty Ltd (a company associated with BDO Audit (WA) Pty Ltd) in relation to Mineral Resources Rent Tax matters.

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NON-AUDIT SERVICES 2013 ($) 2012 ($)
Mineral Resources - 6,064
Rent Taxation advice
Other - -
Total - 6,064
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AUDITOR’S INDEPENDENCE DECLARATION

The auditor’s independence declaration for the year ended 30 June 2013 has been received and can be found on page 53 of the fi nancial report.

OPERATIONS AND FINANCIAL REVIEW

REVIEW OF OPERATIONS - CORPORATE

Meetings of Shareholders

General Meeting - the Company convened a meeting of shareholders on 1 November 2012 to consider the ratifi cation of the allotment and issue of shares; as well as seeking approval for the issue of unlisted options to the Company’s Managing Director & CEO. All resolutions put to the meeting were unanimously passed on the requisite show of hands.

2012 Annual General Meeting - the Company convened the 2012 Annual General Meeting of shareholders (AGM) on 30 November 2012 to consider the Company’s fi nancial accounts, the directors’ remuneration report, the re-election of directors, the allotment and issue of shares & options and the conversion of a Convertible Note. All resolutions put to the meeting were passed on the requisite show of hands.

2013 Annual General Meeting – the Company’s 2013 AGM will be held on Thursday, 14 November 2013 at 1:30pm (WST) in West Perth, Western Australia. Notice of the AGM will be distributed to shareholders in due course in accordance with the Corporations Act.

Fund Raisings - Equity

During the fi nancial year the Company undertook the following placements to new and existing sophisticated and professional investors:

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DATE OF PLACEMENT NUMBER OF SHARES PRICE PER SHARE GROSS SETTLEMENT
VALUE
6 September 2012 8,000,000 $0.085 $680,000
3 December 2012 29,492,537 $0.085 $2,506,866
11 January 2013 16,500,000 $0.10 $1,650,000
7 February 2013 5,000,000 $0.10 $500,000
Totals 58,992,537 $0.0925 (MEAN) $5,336,866
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The 2012 placements were approved by shareholders at general meetings and the 2013 placements were issued under the Company’s 15% placement capacity. Monies raised from the placements were used to fund the Company’s exploration programmes (which included project development studies) and for working capital.

Subsequent to the above placements, on 3 April 2013, the Company was notifi ed by two of its substantial shareholders that they, along with a third non-substantial shareholder, were to be considered ‘associates’ in relation to Mindax’s aff airs. The associated shareholding is summarised as follows:

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NAME NO OF % OF ISSUED
SHARES CAPITAL
Mr Qi Lin 5,900,000 2.34%
Mr Chenfei Zhuang 19,844,956 7.87%
Mr Zhensheng Zhuang 23,295,522 9.23%
Total 49,040,478 19.44%
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The above three shareholders participated in one or more of the 2012 placements and the January 2013 placement summarised above.

Fund Raisings – Convertible Note

On 27 September 2012 the Company issued a Convertible Note for $399,000 to Ms Lai You, an existing shareholder of the Company and related party to non-executive director, Mr Andrew Tsang. Following shareholder approval received at the Company’s 2012 AGM, the Company converted the Note into 4,694,118 fully paid ordinary shares at $0.085 per share.

Exercise of Unlisted Options

During the fi nancial year the Company received instructions from shareholders to exercise the following options:

DATE	NO OF OPTIONS	EXERCISE PRICE	OPTION EXPIRY DATE	ASX CLASS ID
20 December 2012	2	$0.35 per option	31 May 2013	MDX7751
21 June 2013	2	$0.35 per option	31 May 2013	MDX7751

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OPERATIONS AND FINANCIAL REVIEW

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Unlisted Options – Lapsed and Expired

The following unlisted options issued by the Company expired/lapsed during the fi nancial year without exercise:

1. 250,000 unlisted employee options (MDX7742) with an exercise price of $0.53 each, expired on 1 August 2012.

2. 300,000 unlisted employee options (MDX7744) with an exercise price of $0.48 each, expired on 12 October 2012.

3. 650,000 unlisted employee options (MDX7748) with an exercise price of $0.45 each, lapsed on 31 May 2013.

4. 650,000 unlisted employee options (MDX7749) with an exercise price of $0.60 each, lapsed on 31 May 2013.

There are currently no listed options issued by the Company.

Issue of Options to Directors

On 9 November 2012 the Company issued 4,000,000 unlisted options exercisable at $0.108 per option and expiring on 9 November 2015 to the Ward Family Trust, being a party nominated by the Managing Director and CEO of the Company, Dr Steve Ward. The unlisted options were issued pursuant to Dr Ward’s employment agreement following shareholder approval received at a general meeting held on 1 November 2012.

On 10 December 2012 the Company issued 2,500,000 unlisted options exercisable at $0.11 per option and expiring on 10 December 2015 to non-executive directors pursuant to shareholder approval received at the Company’s 2012 Annual General Meeting, summarised as follows:

• 1,000,000 options to a party nominated by Mr Gilbert George, being the Gilbert George Superannuation Fund;

• 500,000 options to a party nominated by Mr Benjamin Chow, being Sydney Subdivision Pty Ltd;

• 500,000 options to Mr Andrew Tsang; and

Executive and Board Movements

On 30 July 2012, the Company appointed Dr Steve Ward as the Company’s new Managing Director and CEO following an extensive search and recruitment process. Steve has over 30 years’ experience in the mining, minerals processing and chemicals industries and has signifi cant Board and business leadership experience.

On 20 August 2012, non-executive director Mr John Stacpoole tendered his resignation from the Company and accepted a new full time executive role with a major contractor involved in the Iron Ore sector. Mr Stacpoole’s resignation was tendered to enable him to focus fully on his new role and ensure no personal confl ict of interest arose.

On 18 April 2013, the Company appointed Mr Yonggang Li as a non-executive director to its Board. Mr Li was nominated by the aforementioned group of associated Mindax shareholders (being Messrs Zhuang and Lin, set out on page 25). Mr Li is a widely experienced Chinese businessman who has signifi cant exposure to iron ore mining and the Chinese market in general. Mr Li was appointed with immediate eff ect and will off er himself for election at the Company’s 2013 AGM.

On the same date, Mr Li appointed Mr Chenfei Zhuang as his alternate director. Mr Zhuang is currently a substantial shareholder in Mindax and a JV partner with Mindax in the Meekatharra North Gold Project (see below). However, on 29 June 2013 Mr Li terminated Mr Zhuang’s appointment as Mr Li felt he could now personally dedicate the time required in full for his directorial responsibilities to the Company.

Strategic Partnership - Mt Forrest Iron Project

On 26 March 2013 the Company announced that it and its wholly owned subsidiary, Yilgiron Pty Ltd, proposed to form a strategic partnership with Hong Kong’s Perpetual Mining Holding Limited (PMHL) for the Mt Forrest Iron Project.

• 500,000 options to Mr Loh Kgai Mun.

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>

MINDAX’S STRATEGY IS TO BUILD A MINING HOUSE FOR KEY COMMODITIES TO REWARD SHAREHOLDERS WELL.

REWARD

A non-binding Memorandum of Understanding (MOU) was signed by the parties to cover the terms in which PMHL will acquire up to 51% interest in the Project’s Direct Shipping Ore (DSO) rights and up to 49% in the Project’s Magnetite rights by spending up to circa $52M by way of farm-in to fast track the development of the Mt Forrest Iron Project.

PMHL was also granted exclusivity to undertake due diligence which commenced early April. For this exclusivity, PMHL paid Mindax $250,000 during the period of due diligence. Following their due diligence and review by their board, PMHL issued a formal notice advising of their agreement to proceed with the joint venture transaction.

The arrangement will allow Messrs’ Zhuang to earn 51% of the Meekatharra North Gold Project by expending a minimum of $2.5M over 3 years from October 2012. Messrs’ Zhuang were required to spend $500,000 by August 2013 (which was completed) before the fi rst opportunity to withdraw. As at the date of this report planning is underway for the next phase of exploration on the project.

Mindax will continue to manage the tenement and provide technical expertise during the earn-in period. Please refer to section below for a review of the exploration programme undertaken for the Meekatharra North Gold Project.

The proposed joint venture transaction remains subject to negotiation and execution of a binding formal joint venture agreement as well as any statutory approvals required to proceed with the strategic partnership. In this regard, joint venture agreement negotiations have commenced (and are continuing as at the date of this report) taking into consideration the MOU previously agreed between PMHL and Mindax.

Strategic Partnership – Meekatharra North Gold Project

On 10 October 2012, the Company entered into a Deferred Farm-in/Farm-out Agreement with Mr Chenfei Zhuang and Mr Zhensheng Zhuang. At the time of the agreement, Mr Chenfei Zhuang was an existing shareholder (of circa 1.2%) in the Company.

REVIEW OF OPERATIONS - STRATEGY

Mindax’s strategy is to build a mining house for key commodities to reward shareholders well.

During the fi nancial year, the Company continued to build on previous exploration successes with further exploration drilling and project development activities. This work was focused exclusively on existing projects with the objective to progressively move these along the development pathway towards full production and in doing so increase shareholder value. Details of progress are given in the Project Review section, commencing on page 29.

The current status for each is graphically demonstrated below:

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Project
Generation
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Scoping
Study
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Construction
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Gold Uranium Iron Ore Meekatharra Yilgarn-Avon Mt Forrest

Copper (+Gold) Mortlock

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OPERATIONS AND FINANCIAL REVIEW

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Akey focus is to secure appropriate strategic partners for each project. Funding contributions from partners are then used for project development. Consistent with this approach, there have been two signifi cant moves forward – as set out on the previous page a farm-in/farm-out arrangement for the Meekatharra North Gold Project was fi nalised in October 2012 and discussions for a joint venture for the Mt Forrest Iron Project are well advanced.

Despite challenging fi nancial markets, it was also possible to raise funds via equity issues and convertible notes to support the Company’s activities, with the Company raising circa $5.7M during the fi nancial year.

systems and procedures are satisfactorily developed, implemented and eff ective”. The highest category rating can be achieved in a few months time when there is demonstrable evidence that some new procedures have routinely been used over a satisfactory period of time. Prior to the safety management system upgrade, the compliance rating was 38%.

There was no lost time or medical treatment injuries to staff or contractors.

The Company has developed procedures to meet our regulatory requirements for current activities. No environmental breaches of license conditions or other environmental regulations have occurred.

REVIEW OF OPERATIONS – SUSTAINABILITY

Mindax treats sustainability as a matter of the utmost importance. It is essential for the Company to develop in a sustainable way, underpinned with good corporate governance, eff ective risk management and sound fi nancial controls to ensure enduring success.

The Company undertook a comprehensive review of its approach to sustainability. This resulted in the launch of a new Sustainability Framework to complement the existing activities in other corporate areas noted above (see Figure 1).

The Sustainability Framework covers the key activities of Safety, Health, Environment, Use of Resources, Product Stewardship, Communities and Heritage.

Considerable eff ort was undertaken to update and augment the Company’s safety management system to ensure current requirements are catered for and future needs can be added when required. The upgraded safety management system was independently audited against recognised Australian and New Zealand Standard AS/NZS 4801. A compliance rating of 74% was achieved which falls within the category: “(64% to 85%)

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Figure 1: Mindax Sustainability Framework

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A CONSIDERABLE AMOUNT OF FIELD WORK FOR THE FIRST TIME FOR APPROXIMATELY 18 MONTHS, SAW A NUMBER OF VERY ENCOURAGING RESULTS. ENCOURAGING

REVIEW OF OPERATIONS –PROJECTS

Overview

Mindax retained its portfolio of key commodity projects for iron ore, uranium, gold and copper. All projects are located in Western Australia (Please refer to Figure 2).

Following successful capital raisings in December 2012 and January 2013 and fi nalisation of a Deferred Farm-in/Farm-Out Arrangement for the

Meekatharra North Gold Project in October 2012, the Company had suffi cient funds to make notable progress on each of its projects. This included a considerable amount of fi eld work for the fi rst time for approximately 18 months, with a number of very encouraging results.

Signifi cant progress has been made towards the formation of a joint venture for the Mt Forrest iron ore project. Final negotiations with PMHL are in progress.

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Figure 2: Project location overview map

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OPERATIONS AND FINANCIAL REVIEW

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The Company continues to defi ne clear development pathways for each of its projects to generate best shareholder value. The commercial and technical work completed in the past 12 months has advanced each project well.

Mindax continues to hold an extensive tenement portfolio comprising 52 tenements for 4,613 km[2] (refer to the summary on page 41) and project expenditure has allowed priority tenements to remain in good standing. A small number of tenements were assessed as having low/nil prospectivity and were surrendered.

PROJECT SUMMARY

1) Mt Forrest Project (Iron Ore)

The Mt Forrest Project (Figure 3), wholly owned by Mindax through its subsidiary Yilgiron Pty Ltd, is situated 165 km from line of rail at Menzies and some 645 km from Esperance port. On this project the Company has built up a signifi cant iron ore inventory, with the JORC mineral resource currently standing at 1.71 billion tonnes of primary magnetite ore grading 31.8% Fe and 12.3 Mt of regolith (haematite/goethite) mineralisation (refer to the “Mineral Resource Summary” on page 42 for resource details). Results of a Scoping Study were released in April 2012.

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Figure 3: Mt Forrest project location map

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Technical work has focussed on developing an Optimised Scoping Study for Direct Shipping Ore (DSO). The objectives are to increase annual output, extend mine life, reduce operating costs and stage capital requirements to improve project fi nancial returns. A key component of this work is to increase the suitable iron ore inventory and in doing so be able to devise a Conceptual Production Schedule which enables the material which is easiest to process to be exploited fi rst. A summary of the work undertaken is given below.

IRON RESOURCE

Detrital iron mineralisation was targeted as the main means to increase suitable iron ore inventory. A gravity survey, undertaken in March 2013 over known detrital mineralisation as well as scree-covered areas, served to better defi ne exploration targets. Areas surveyed are outlined on Figure 4.

Detrital iron mineralisation targets occurring on the fl anks of the Mt Forrest ranges were investigated by air core and percussion drilling programmes undertaken in January 2013 (124 holes for 1,771 metres), May 2013 (79 holes for 1,294 metres) and June 2013 (45 holes for 521 metres). This work has defi ned mineralisation in four separate occurrences on three prospects (Figure 4):

• Cassowary, in the southwest of the project area, is the largest occurrence (1500 metres long, 250 metres wide and of average thickness 15 metres). Best drill results include 12 metres @ 40.0% Fe from surface and 19 metres @ 43.7% Fe from 23 metres (hole MFC0505).

• Toucan in the northwest, where drilling has expanded the known size of the occurrence to a length of 1300 metres, width of 200 metres and average thickness of 8 metres. Grades range up to 14m @ 45.3% Fe from surface (hole MFC0607).

• Parrot-Corella in the northeast, where detrital material is present in two closely adjacent lenses. The northern measures 450 metres long, 300 metres wide and 3 metres thick, the larger southern lens 970 metres long, 300 metres wide and 4 metres thick. The latter includes some canga which was tested on hole MFC0551, returning 5 metres @ 53.3% Fe from surface.

Increases to the existing regolith (haematite/ goethite) iron inventory were also targeted, although scope was more limited than the potential detrital opportunity.

A further 6 percussion holes for 238 metres were drilled during June at Currawong (Figure 4), testing for southern extensions of the near-surface haematite and goethite mineralisation identifi ed during a drilling programme undertaken in October 2010. The holes intersected an interbedded suite of basalt and magnetite-dominant banded iron formation with only minor development of microplaty haematite. Iron assays were mostly below 40% Fe.

METALLURGICAL TESTWORK

Composite representative samples from key air core drill holes have been selected for bulk metallurgical test work. These samples have been chosen on grade range and visual composition to test the benefi ciation limits and identify a suitable lower cut–off grade for mineral resource estimation. The metallurgical test work is on-going. In addition, two representative diamond drill holes were completed during July 2013 in order to obtain a bulk sample for the metallurgical test work.

HERITAGE

Good relationships have been maintained with our indigenous stakeholders and annual updates on the Company’s activities were given to each indigenous stakeholder group.

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OPERATIONS AND FINANCIAL REVIEW

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Figure 4: Drilled detrital iron occurrences at Mt Forrest

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EACH INDIGENOUS STAKEHOLDER GROUP HAS BEEN INVOLVED WITH GROUND CLEARANCE PROGRAMMES TO ENSURE THE PROTECTION OF > ABORIGINAL HERITAGE. PROTECTION

Each indigenous stakeholder group has been involved with ground clearance programmes to ensure the protection of Aboriginal heritage prior to drilling campaigns as per the requirements of our approvals for exploration (under section 18 of the Aboriginal Heritage Act 1972 (Commonwealth).

During June 2013, a representative from the Kalgoorlie branch of the Department of Aboriginal Aff airs spent 3 days on-site inspecting 13 selected registered heritage sites within the project area to ensure that no sites had been impacted by any of the Company’s exploration activities. Although the Company has not received any formal feedback from the audit the verbal feedback given at the completion of the audit was positive.

Mining methods, mine plan sequences and haul paths to the process plant were considered for the regolith and detrital ore bodies and also took into account future mining requirements associated with the magnetite ore bodies.

Reviews of capital and operating costs are ongoing. For capital expenditure, the specifi c focus is for a staged approach to capital expenditure with the lowest upfront requirement possible and also assessment of potential use of Build, Own and Operate (BOO) contracts to reduce overall capital demand. Operating cost studies are targeting mining plan, processing requirements and logistics costs. The latter form a signifi cant portion of the overall operating costs.

ENGINEERING

Engineering activities have been gradually ramped up as the Optimised Scoping Study work has progressed. A small number of experts in the engineering area have been added to the in-house project team to complement existing skills. A summary of key activities is given below.

A layout for site infrastructure required for production has been created to defi ne areas of disturbance and optimal location for ore haul to the ROM pad for processing. This includes the siting of the tailings facility, mine operations facility, the power station, fuel storage and the accommodation camp.

A desktop water resource study has been undertaken to advise on the most prospective areas for a water exploration drilling programme within the existing mining leases. Four holes were then completed and intersected reasonable volumes of relatively fresh, near potable ground water. These holes were also geologically logged and some were sampled for iron. Assays for these holes are pending. Pipeline and services pathways were mapped from the potential bore fi eld area to the accommodation camp and process plant.

LOGISTICS

The availability of reliable and commercially cost competitive logistics infrastructure is crucial to the success of the Mt Forrest iron project. The Company has devoted considerable time to this area as progress is made towards confi rming an acceptable fi nal logistics solution. There are ongoing discussions will all key logistics stakeholders, including service providers, government, Esperance Port and other interested parties.

A detailed assessment was made of the proposed haul road route from site to the railhead at Menzies. The objective is to maximise the tonnes hauled per truck and reduce the amount of truck movements on the road. This will lower costs and improve safety for all road users. Various discussions have been held with potential road haulage providers.

Discussions with other Yilgarn miners were conducted and a cooperative approach agreed for a single rail load out facility to be located eight kilometres south of Menzies. The Company will continue to engage with both the above and below ground rail operators as the project schedule progresses.

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OPERATIONS AND FINANCIAL REVIEW

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Discussions with the Shire of Menzies have been undertaken relating to the siting of the rail load out facility, a new light industrial area, provision for accommodating the haulage contractors’ employees in the town and potential government support for additional infrastructure required with this increased activity.

The Company has been involved fully, both as an individual corporate entity and as a member of the Yilgarn Iron Producers Association (YIPA), in the Esperance Port upgrade project. Discussions have been held and are ongoing with a number of stakeholders, including the shortlisted Port Upgrade Project proponents.

ENVIRONMENTAL

Considerable work has been undertaken to reach the position where the Company has now begun preparatory work for the regulatory approval submissions to the Environmental Protection Authority (EPA).

Level 2 fl ora and fauna fi eld surveys for both the spring and autumn seasons were completed. A survey to identify the potential of the area for use by the nationally threatened bird species, the Malleefowl was also completed. No species listed as endangered under State or Federal environmental legislation have been recorded, which should allow for a more streamlined approvals process.

Further work planned for the July 2013 quarter includes an assessment of waste rock material and surveys for Short Range Endemic Invertebrates (SREs) which will substantially complete the environmental impact assessment.

STAKEHOLDER ENGAGEMENT

Mindax’s approach is to be open and transparent regarding its activities with all stakeholders. There have been a number of discussions with a wide range of interested parties. These include politicians, government bodies, Non-Government Organisations (NGOs), indigenous groups and local community organisations.

Mindax has been an active participant within YIPA. The Company has contributed to four successful studies commissioned by YIPA and undertaken by independent expert consultants AECOM. These studies review the capacity of the existing rail network and Esperance Port and options for expansion. Economic analysis of Esperance port expansion options has also been undertaken. The economic benefi ts to the State and communities of 10 million tonnes of new capacity iron ore from the Yilgarn have been estimated as well.

MT FORREST GOLD EXPLORATION

Following on from previously announced results of 10-metre composite samples taken from selected percussion drill holes, the best anomalous intervals from these holes were prepared for resampling into one metre composites. A total of 1,353 one-metre samples were generated by riffl e splitting each individual metre taken from bulk sample material that is stored at the Mt Forrest bag farm. These samples were assayed for gold in Perth.

A total of 28 drill holes returned values above 1 ppm gold over down-hole widths of between one and six metres, with some holes having multiple mineralised intersections. Best value of 5.96 ppm was recorded from the interval 28-29 metres in hole MFC0219. The majority of intercepts are from near surface, but several are from down-hole depths in excess of 200 metres where they represent quartz-fi lled fractures within magnetite banded iron formation.

The data will be reinterpreted with the aim of generating an updated gold resource.

PROPOSED MT FORREST JOINT VENTURE

Signifi cant progress has been made towards the formation of a joint venture for the Mt Forrest iron ore project. Final negotiations with Perpetual Mining Holding Limited (PMHL) are in progress.

Please refer to Review of Operations - Corporate (page 26 “Strategic Partnership - Mt Forrest Iron Project”) for details of the proposed joint venture.

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2) Yilgarn-Avon Joint Venture (Uranium)

The joint venture (Mindax 80.77%, Quasar Resources Pty Ltd 19.23%, calculated as at 31 July 2013) covers several projects, detailed below, in the Wheatbelt of Western Australia (Figure 5). Previous scout drilling at Mukinbudin had identifi ed a maiden 3.2 million pound resource at the Yandegin and Jindarra prospects (refer to the “Mineral Resource Summary” on page 42 for resource details).

Early in the reporting year, land holdings in the project area were rationalised, with the total relinquishment of 3 licences and the partial relinquishment of a further 16 licences. All relinquishments involved ground considered not to be prospective for uranium mineralisation.

A scout drilling programme was undertaken successfully in the fi rst half of 2013 in parts of each of the major project areas Quairading, Kellerberrin and Mukinbudin (see Figures 6, 7 and 8). The programme was funded entirely by Mindax. Relevant interests in the joint venture will be recalculated in due course, with a resultant increase in the Company’s percentage holding.

The scout programme was designed to test for downstream variations in geology and water chemistry in the palaeochannel and to identify those sections that have the best geological conditions to allow uranium to be deposited.

This included targeting new areas of the palaeochannel at Quairading and Kellerberrin and

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Figure 5: Yilgarn Joint Venture project location map

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OPERATIONS AND FINANCIAL REVIEW

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pursuit of extensions to the existing uranium mineralisation at Mukinbudin. Initially four-metre composite samples, which had been obtained from the drilling, were analysed. Selected samples with elevated levels of uranium were then broken down into one metre samples which were subsequently analysed. On completion of drilling all sites were rehabilitated.

This work has identifi ed 3 new high priority targets at the Mukinbudin Project, which is extremely prospective and now contains 5 prospects over a 100km length of palaeochannel.

The Kellerberrin and Quairading Projects are less prospective, but remain of interest. Widespread,

modestly elevated levels of uranium (generally 20 -30 ppm U) were found at Kellerberrin. No uranium occurrences were found at Quairading, but three untested areas of interest remain.

Work on the individual projects within the joint venture area is summarised below.

QUAIRADING PROJECT

A total of 680 four-metre composite samples were collected from the 56 holes (2,554 metres) drilled. On analysis, all returned less than 20 ppm U. In view of these results the geological model was reviewed, leading to the identifi cation of three new areas of interest which will be considered for drilling in future work programmes.

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Figure 6: Quairading project location map

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WORK HAS IDENTIFIED 3 NEW HIGH PRIORITY TARGETS AT THE MUKINBUDIN PROJECT, WHICH IS EXTREMELY PROSPECTIVE.

HIGH PRIORITY

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Figure 7: Kellerberrin project location map

KELLERBERRIN PROJECT

All 38 holes (1,875 metres) were sampled on a 4-metre composite basis. Fourteen samples from 8 drill holes graded better than 20 ppm U, best results being 16 metres at 29 ppm U (hole YAA0448) and 8 metres at 32 ppm U (hole YAA0460). All anomalous intervals were re-sampled on a one-metre basis, generating 51 samples. Of these only one showed any signifi cant upgrading of the parent composite sample, returning 63 ppm U (hole YAA0460), the

remaining results ranging from 20 to 30 ppm U.

The presence of widespread, low grade uranium mineralisation and generally oxidised nature of the channel sediments suggest that the uranium may be remaining in solution, passing through the drilled area to be deposited elsewhere in the palaeodrainage system. Revision of the geological model and generation of new drill targets for consideration in future work programmes is ongoing.

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OPERATIONS AND FINANCIAL REVIEW

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MUKINBUDIN PROJECT

Drilling (87 holes for 7,603 metres) generated 2,006 samples composited over a 4-metre interval. Of these 144 samples from 45 drill holes returned anomalous uranium values exceeding 20 ppm U, best results including 233 ppm U (hole YAA0481), 109 ppm U (hole YAA0529) and 104 ppm U (hole YAA545).

A total of 87 composite samples grading greater than 25 ppm U were selected for re-assaying, producing 340 one-metre samples. Of these 14 samples returned grades exceeding 100 ppm U, best results being 882 ppm U (hole YAA0481) and 406 ppm U (hole YAA0545). These results have

identifi ed 3 areas in which high grade uranium was returned from multiple drill holes on adjacent drill traverses.

Results of the exploration programme have shown that the prospective paleochannel system is not located within the bounds of tenements E70/4062 and E70/3662 and consequently on 5 June 2013 both tenements were voluntarily surrendered.

The Mukinbudin Project now has, within a 100 kilometre length of prospective palaeochannel, 5 individual prospects each of which could potentially host a uranium deposit. Future exploration is under consideration.

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Figure 8: Mukinbudin project location map

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>

THE ASSAY RESULTS HAVE BEEN INTERPRETED AS TWO ZONES OF SUPERGENE COPPER ENRICHMENT OFFSET SOME 500M BY A LARGE FAULT. SUPERGENE COPPER

3) Mortlock Project (Copper, Gold)

With tenements located mostly north and east of Northam (Figure 9) the project comprises a joint venture between Mindax Energy Pty Ltd (81% and operator) and Quasar Resources Pty Ltd (19%). It includes areas of ground held by Sipa Exploration NL (Sipa) and joint ventured to the Yilgarn-Avon Joint Venture (51% and operator). Exploration is focused on copper-gold mineralisation.

A total of 58 holes for 2,748m were drilled in February and March 2013 at the Centre Forrest prospect on E70/3266.

Encouraging 4 metre assay results were received for a number of holes, with the best result, reported from drill hole CFA0072, being 12 metres at 0.65% Cu from 32m down-hole, including 4 metres at 1.01% Cu from 32m down-hole. The adjacent drill hole CFA0074, located 50m along strike to the south, intersected 8 metres at 0.50% Cu from 24 metres downhole. The assay results have been interpreted as two zones of supergene copper enrichment off set some 500m by a large fault. The footprint of these two zones covers approximately 700 x 500 metres and 600 x 300 metres respectively and could indicate the existence of a larger mineralising system at depth (see Figure 10).

Selected one-metre samples were sent for further assay. These results announced in July 2013 confi rmed the presence of the copper anomaly. Interpretation and future work planning is now in progress.

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Figure 9: Mortlock project location map

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Figure 10: Mortlock project area, showing copper anomalies

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OPERATIONS AND FINANCIAL REVIEW

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4) Meekatharra North Project (Gold)

Located some 40 kilometres north of Meekatharra the project (see Figure 11), comprising three separate portions of one single exploration licence, is wholly owned by Mindax. In view of its location immediately adjacent to and south of Doray Minerals’ Andy Well gold fi nd (831,000 tonnes @12.7 g/t for 339,350 ounces of contained gold) the project area is regarded as being highly prospective, with auriferous structures potentially continuing south from Andy Well into the Mindax ground.

As outlined on page 27, a strategic partnership (farmin/farm-out agreement) for the Meekatharra North Gold Project was entered into in October 2012 under which $2.5M would be spent on exploration before the end of October 2015 allowing the farm-in partner to earn 51% equity in the project, which would continue to be managed by Mindax.

A Sub-Audio Magnetic (SAM) survey covering the northern portion of the tenement was completed in mid-January 2013. An interpretation of this

geophysical data was undertaken by Southern Geoscience Consultants in March 2013. A subsequent geological review of this data led to the identifi cation of 6 target areas, the fi rst of which was tested in July 2013 by a programme comprising 6,000 metres of angled air core and percussion drilling (Figure 12), fully funded under the farm-in/ farm-out agreement.

Figure 12: 2013 SAM survey over Meekatharra North with exploration targets (polygons), planned drill traverses (pink lines) and existing drill holes.

5 Other Projects - Fred’s Bore (Iron Ore, Gold) Historical exploration data for this licence area was reviewed and three fi eld visits were undertaken.

On the last visit minor gold workings in the southwestern corner of the tenement were inspected, and detrital iron mineralisation developed over a strike length of approximately one kilometre adjacent to outcropping, previously mapped haematite-goethite mineralisation was sampled, returning a best value of 62.64% Fe.

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Figure 11: Meekatharra North project location map

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Figure 11: Meekatharra North project location map

LAND TENURE

Mindax continues to hold an extensive tenement portfolio comprising 52 tenements for 4,613 km[2] , summarised as follows:

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PROJECT NUMBER OF AREA (KM [2] ) NUMBER OF TENEMENTS
TENEMENTS HELD RELINQUISHED DURING THE YEAR
Mt Forrest 7 54
Mt Forrest (water) 5 2,389
Mt Forrest 13 49
(infrastructure)
YAJV Uranium 16 1,458 3
YAJV Mortlock 9 557
Meekatharra North JV 1 55
Fred’s Bore 1 51
Totals (rounded) 52 4,613 3
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OPERATIONS AND FINANCIAL REVIEW

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Mineral Resource Summary

No changes to the mineral resource inventory occurred during the fi nancial year.

1) Iron

The current near surface goethite-hematite-martite-magnetite resource stands at 14.7 Mt @ 45.4% Fe (12.3 Mt JORC Indicated @ 45.5% and 2.4 Mt JORC Inferred @ 44.8% - above 40% cut-off ) and are presented in the table below:

Mt Forrest Iron Project - Mineral Resource Regolith Mineralisation above a 40% Fe cut-off

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RESOURCE TONNES MEAN MEAN MEAN MEAN MEAN MEAN
CATEGORY [Mt] Fe% SiO2% Al2O3% P% S% LOI%
Indicated 12.3 45.5 23.0 5.2 0.06 0.07 6.1
Inferred 2.4 44.8 26.4 4.5 0.05 0.06 4.6
Total 14.7 45.4 23.5 5.0 0.06 0.07 5.8
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Note: Totals subject to rounding

The current primary magnetite resource stands at 1.71 billion tonnes @ 31.8% Fe (248.2 Mt @ 32.6% Fe JORC Indicated and 1,462.4 Mt @ 31.6% Fe JORC Inferred) and is presented as follows:

Mt Forrest Iron Project - Consolidated Mineral Resource Magnetite Mineralisation above a 25% Fe cut-off

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CLASSIFICATION TONNES Fe SiO2 Al2O3 LOI P S
[Mt] [%] [%] [%] [%] [%] [%]
Indicated 248.2 32.6 47.0 1.7 1.1 0.06 0.12
Inferred 1,462.4 31.6 47.9 1.8 2.2 0.04 0.10
Total 1,710.6 31.8 47.7 1.8 2.0 0.05 0.10
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Note: Totals subject to rounding

2) Uranium

The current mineral resource calculated by Optiro Pty Ltd has estimated the mineral resource for the uranium mineralisation at the Mukinbudin Project to be 3.2Mlbs at 0.02% U3O8 (JORC Inferred) using a 100 ppm (0.01%) U3O8 cut–off . The mineral estimate currently consists of 1.1Mlbs at 0.03% U3O8 at the Jindarra Prospect and 2.1Mlbs at 0.02% U3O8 at the Yandegin Prospect.

The table below shows the Mineral Resource as estimated by Optiro.

Resource Tabulation by Prospect at 100 ppm U3O8 cut-off

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PROSPECT CATEGORY TONNES METAL GRADE GRADE U3O8
[Mt] [t] [%] [ppm] [Mlbs]
Jindarra Inferred 1.86 500 0.03 273 1.12
Yandegin Inferred 4.36 950 0.02 221 2.12
Total Inferred 6.22 1,450 0.02 237 3.25
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Note: Totals subject to rounding

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INTERESTING RESULTS HAVE BEEN OBTAINED ON ALL PROJECTS AND ARE > SUFFICIENTLY ENCOURAGING TO RETAIN INTEREST IN ALL PROJECTS AND DEVELOP FORWARD PLANS. FORWARD PLANS

The following two Tables provide a breakdown of the resources at Jindarra and Yandegin at a variety of cut-off grades.

Jindarra Resource Tabulation at a variety of cut-off grades

U3O8 cut-of [ppm] 100	TONNES [Mt] 1.86	METAL [t] 500	GRADE [%] 0.03	GRADE [ppm] 273	U3O8 [Mlbs] 1.12
200	0.77	350	0.05	454	0.77
300	0.31	250	0.08	765	0.52

Note: Totals subject to rounding

Yandegin Resource Tabulation at a variety of cut-off grades

U3O8 cut-of [ppm] 100	TONNES [Mt] 4.36	METAL [t] 950	GRADE [%] 0.02	GRADE [ppm] 221	U3O8 [Mlbs] 2.12
200	1.88	600	0.03	321	1.33
300	0.96	400	0.04	402	0.85

Note: Totals subject to rounding

Competent Person Statements

1) Iron

Mr Michael Andrew is a member of the Australasian Institute of Mining and Metallurgy (MAusIMM) and has suffi cient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity to which he is undertaking to qualify as a competent person as defi ned in the 2004 edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Andrew is a fulltime employee of Optiro Pty Ltd and the Company holds a prior consent to include the matters based on his information in the context in which it appears in this report.

2) Uranium

Dr Katrin Kärner is a member of the Australasian Institute of Mining and Metallurgy (MAusIMM) and has suffi cient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity to which she is undertaking to qualify as a competent person as

defi ned in the 2004 edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Dr Katrin Kärner is a full-time employee of Optiro Pty Ltd and the Company holds a prior consent to include the matters based on her information in the context in which it appears in this report.

REVIEW OF OPERATIONS - OUTLOOK

Mindax has made notable progress with each of its four projects for key commodities. Access to funds from equity markets and joint venture partners (e.g. Meekatharra North) has enabled project momentum to be built and signifi cant work to be carried out. This has included exploration fi eld work after a period of approximately 18 months inactivity due to funding shortages. Interesting results have been obtained on all projects and are suffi ciently encouraging to retain interest in all projects and develop forward plans. There is certainly value potential present.

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OPERATIONS AND FINANCIAL REVIEW

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The rate and extent of future progress is largely dependent on the Company’s capacity to secure new funds from equity markets and potential joint venture partners. In that regard, the Company has demonstrated excellent capability in the past 12 months in very challenging fi nancial markets. However, economic conditions remain particularly diffi cult and access to suffi cient funds is by no means certain. Progress of each project through the development phases is also dependent on obtaining robust results in any single phase before moving to the next one.

A brief work programme summary for the next fi nancial year is as follows:

Mt Forrest Iron Project

Advance project to complete Optimised Scoping Study and Feasibility Study, secure regulatory approvals and commence mine development. As signifi cant funding will be required to deliver this programme, securing the proposed joint venture will be critical to the project’s success.

Yilgarn Avon Uranium Project

Undertake targeted drilling on highly prospective areas with the aim of increasing the current JORC resource.

Mortlock Copper Project

REVIEW OF FINANCIAL

Financial Results

The consolidated loss of the Group for the fi nancial year after providing for income tax amounted to $1,814,133 (2012: $2,299,213). The loss was largely a result of write off of exploration expenditure previously capitalised and general costs and overheads associated with running the Group for the 12 months to 30 June 2013.

Financial position

The net assets of the Group have increased from 30 June 2012 by $3,779,310 to $26,662,456 at 30 June 2013. This is largely due to the following factors:

• fi ve capital raisings that raised circa $5.7 million, before transaction costs;

• continued exploration for and evaluation of all the Group’s mineral resource projects totalling $4,393,807 (before exploration costs written off during the reporting period of $952,530);

• Research and Development (R & D) tax concession received for fi scal year 2012 of $1.197M (2011: $0.7M).

Dividends Paid or Recommended

No dividends were paid or declared since the start of the fi nancial year. No recommendation for payment of dividends has been made.

Carry out further scout and targeted drilling to investigate the copper anomaly present.

END OF OPERATIONS AND FINANCIAL REVIEW

Meekatharra North Gold Project

Move forward with scout and targeted drilling which will be funded by the joint venture partner.

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REMUNERATION REPORT (AUDITED)

REMUNERATION POLICY

The objective of the Company’s remuneration framework is to ensure reward for performance is competitive and appropriate for the results delivered.

The Company’s remuneration policy for executive directors, offi cers and senior management is designed to promote superior performance and long term commitment. Remuneration packages are set at levels that are intended to attract and retain executives capable of managing the Group’s operations. The main principles of the policy are:

• Reward refl ects the competitive market in which the Group operates:

• Individual rewards can be linked to performance criteria; and

• Executives should be rewarded for both fi nancial and non fi nancial performance.

Overall remuneration policies are determined by the Board and are adapted to refl ect competitive market and business conditions where it is in the interests of the Group and shareholders to do so. Within this framework, the RemunerationNominations Committee considers remuneration policies and practices generally, and recommends specifi c remuneration packages and other terms of employment for executive directors and senior management. The Corporate Governance Statement provides further information on the role of this committee. Ultimate responsibility for the Group’s remuneration policies rests with the full Board.

Non executive Directors

Fees and payments to non executive directors refl ect the demands which are made on them and their individual responsibilities. Non executive directors’ fees and payments are reviewed annually by the Board. The Chairman’s fees are determined independently to the fees of non executive directors based on comparative roles in the external market. The Chairman is not present at any discussions relating to the determination of his own remuneration; and he currently receives a fi xed fee for his services as a director.

The current base remuneration for the non executive directors and the Chairman was last reviewed in February 2013. No increase was awarded to non-executive directors other than the Chairman (now $90,000 per annum [including statutory superannuation]) to recognise the additional level of work commitments required for this role.

The Board also adopted a recommendation of the Remuneration-Nominations Committee in February 2013 to introduce Committee Fees, payable to members of the Audit and RemunerationNominations Committees. The Board agreed to fees of $5,000 per annum for each member of a committee, and $10,000 per annum for the Chairman of each committee. Such fees are paid to applicable members on a quarterly basis.

To this end, the Company’s non executive directors’ standard remuneration package contains only two components, being a primary benefi t of quarterly director’s fees and committee fees (where applicable), plus compulsory superannuation. In addition, on occasion, some form of performance based remuneration (through the issue of unlisted options) are approved by shareholders which forms part of a non-executive director’s overall remuneration. Such remuneration is discussed further on page 46, under “Performance based Remuneration”.

Non executive director fees (including committee fees) are determined within an aggregate directors’ fee pool limit, which is periodically recommended for approval by shareholders. The maximum currently stands at $400,000 per annum and was approved by shareholders at the 2010 Annual General Meeting.

No retirement benefi ts are provided to directors.

Remuneration details for non-executive directors (including any short-term and long-term incentives) are set out in the sections below.

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REMUNERATION REPORT (AUDITED)

Executive Directors

Generally, the Company’s executive director’s remuneration package contains the following components:

• base pay and benefi ts, including superannuation (Total Fixed Remuneration);

• short-term performance incentives; and

• long-term performance incentives, being equity – share options granted under the employee option scheme or approved by shareholders of the Company.

The combination of these comprises the executive’s total remuneration.

Total Fixed Remuneration is structured as a total employment cost package which may be delivered as a combination of cash and prescribed non fi nancial benefi ts at the executive’s discretion. External remuneration data provides benchmark information to ensure the base pay is set to refl ect the market for a comparable role. Total Fixed Remuneration is reviewed periodically (usually annually) to ensure the level is competitive with the market. There is no guaranteed Total Fixed Remuneration increases included in any executive director contracts. A vehicle (or vehicle allowance) and car parking bay is also provided as part of the Total Fixed Remuneration as an additional benefi t to executive directors.

Mindax currently only has one executive director, being the Managing Director and CEO, Dr Steve Ward. Details of Dr Ward’s remuneration (including short-term and long-term incentives) are set out in the sections below.

PERFORMANCE BASED REMUNERATION

Performance based (incentive) remuneration comes in the form of Short Term Incentives (STIs) and Long Term Incentives (LTIs).

The executive director has the opportunity to earn an STI if predefi ned performance targets are achieved. Currently, performance based (incentive) remuneration for the executive director is currently limited to cash bonuses for STIs and the granting options over unissued shares as an LTI. Performance based remuneration for other key management personnel is currently limited to the granting of shares and options.

Details of STIs and LTIs issued by the Company for the 2012-2013 and 2013-2014 fi nancial years are summarised on page 48.

RELATIONSHIP BETWEEN REMUNERATION POLICY AND COMPANY PERFORMANCE

The remuneration policy has been tailored to increase goal congruence between shareholders, directors and executives, including the occasional issue of options to directors and executives which is to encourage the alignment of personal and shareholder interests. The Company believes this policy will be eff ective in increasing shareholder wealth.

The table below shows the Group’s net profi t/ (loss), its’ allocation per share and share price of the Company at the end of the respective fi nancial years.

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2008 $ 2009 $ 2010 $ 2011 $ 2012 $ 2013 $
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Net Prof t/(Loss)	(554,987)	(2,256,691)	(2,339,546)	(2,412,051)	(2,299,213)	(1,814,133)
Loss per share	0.0076	0.0175	0.0178	0.0164	0.0132	0.00812
Share Price at
Year end	0.340	0.490	0.410	0.275	0.073	0.12

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THE REMUNERATION POLICY HAS BEEN TAILORED TO INCREASE GOAL > CONGRUENCE BETWEEN SHAREHOLDERS, DIRECTORS AND EXECUTIVES. REMUNERATION

PERFORMANCE CONDITIONS LINKED TO REMUNERATION

At this stage, the Company’s remuneration of key management personnel (excluding directors) does not include any performance conditions. The Board believes that at this stage of the Group’s development, linking remuneration to fi nancial performance indicators such as share price, revenue or profi t for these personnel is inappropriate. This may change once the Group commences production.

In relation to non-executive directors, the Board believes that a portion of the remuneration package for the non-executive directors should be linked to some form of fi nancial performance indicator, such as share price, from time to time, as determined by the Board. In this regard, options over unissued shares provide a performance linked incentive component in the remuneration package for nonexecutive directors to motivate and reward their performance. Details of options issued to directors during the 2012-2013 fi nancial year are set out below.

In relation to the executive director (again, being the Managing Director and CEO, Dr Steve Ward) the Board believes that a portion of the total remuneration package for the executive director should also be linked to fi nancial performance indicators such as share price, as well as achieving key targets set by the Board on an annual basis. In this regard, a number of STIs were approved by the Board for Dr Ward which apply to the 2013-2014 fi nancial year. They are summarised in the sections below. Dr Ward also received incentive options issued during the 2012 – 2013 fi nancial year. Details of options issued are set out below.

EMPLOYMENT DETAILS OF KEY MANAGEMENT PERSONNEL AND OTHER EXECUTIVES

The table below provides details of persons who were, during the fi nancial year, members of key management personnel of the Company.

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Key Position Held Fixed Shares / Total Fixed Shares / Total 2012
Management Salary / Options 2013 (%) Salary/ Options (%)
Personnel Fees 2013 Issued Fees 2012 Issued
(%) 2013 (%) (%) 2012 (%)
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G George	Non executive	83	17	100	100	-	100
	Chairman
S Ward	Managing Director	84	16	100	-	-	-
	& CEO
A Tsang	Non executive	88	12	100	100	-	100
	Director
B Chow	Non executive	90	10	100	100	-	100
	Director
E Loh	Non executive	89	11	100	100	-	100
	Director
Y Li	Non executive	100	-	100	n/a	n/a	n/a
	Director
C Pougnault	Chief Financial	100	-	100	83	17	100
	Of cer & Company
	Secretary
J Vinar	General Manager	100	-	100	84	16	100
	Mt Forrest

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REMUNERATION REPORT (AUDITED)

The following table provides details of persons who were Key Management Personnel during the fi nancial year but left the Company prior to either 30 June 2013 or prior to the signing of this Annual Report.

Key Management Personnel	Former Position Held	Fixed Salary / Fees 2013 (%)	Shares/ Options Issued 2013 (%)	Total 2013 (%)	Fixed Salary / Fees 2012 (%)	Shares/ Options Issued 2012 (%)	Total 2012 (%)
S Lane (resigned	Exploration	100	-	100	84	16	100
31 January 2013)	Manager

DETAILS OF SHORT-TERM AND LONG-TERM INCENTIVES FOR THE 2013 – 2014 FINANCIAL YEAR

The Managing Director and CEO has a target STI opportunity of circa 20% of his total remuneration for the 20132014 fi nancial year. It is anticipated that 50% of the actual STIs (if achieved) will be paid in cash prior to the end of the fi rst half of the fi nancial year; and the remaining 50% paid in cash prior to the end of the second half of the fi nancial year, if such STIs are achieved.

STI awards for the Managing Director and CEO in the 2013-2014 fi nancial year are based on the following:

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Performance Category Metrics Weighing
JV Funding – Mt Forrest Securing a binding joint venture arrangement. 25%
JV Funding – Mt Forrest Progressing a joint venture arrangement to an 25%
operational status.
Market Capitalisation Improvement in Company’s share price by a 50%
predefi ned percentage.
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There were no STIs in place for the Managing Director and CEO during the 2012-2013 fi nancial year.

Details of options issued to Key Management Personnel during the 2012 – 2013 fi nancial year are set out below and further information is also set out in Notes (17) and (24) to the fi nancial statements.

SERVICE AGREEMENTS

On appointment to the Board, all non executive Directors enter into a service agreement with the Company in the form of a letter of appointment. The letter summarises the Board policies and terms, including compensation, relevant to the offi ce of director.

Remuneration and other terms of employment for the Managing Director and CEO is also formalised in service agreements. By way of a Service Agreement dated 30 July 2012, the Company appointed Dr Steve Ward as Managing Director and CEO of Mindax Limited. Dr Ward’s annual salary, inclusive of a motor vehicle allowance and statutory superannuation (at the rate of 9.25%), is $491,454. Dr Ward is to be reimbursed for all reasonable expenses incurred in carrying out the services of a Managing Director and CEO. Dr Ward is required to provide three calendar months notice of resignation; or is entitled to three calendar months base salary on termination by the Company or six calendar months base salary due to genuine redundancy.

REMUNERATION DETAILS

The following table of benefi ts and payments details, in respect to the fi nancial year, the components of remuneration for each member of the key management personnel of the Company:

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2013 Short-Term Employee Post-Employment Share-Based
Benefi ts Benefi ts Payments
Name Cash Salary Non- Super- Termination Shares Options Total
And Fees Monetary annuation Benefi ts $ $ $
$ Benefi ts $ $
$
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G George	87,568	-	7,431	-	-	19,149	114,148
S Ward	415,962	-	37,437	-	-	88,348	541,747
A Tsang	65,000	-	5,850	-	-	9,574	80,424
B Chow	78,500		8,100	-	-	9,574	96,174
E Loh	67,911	-	6,112	-	-	9,574	83,597
Y Li	10,139	-	913	-	-	-	11,052
J Vinar	200,000	32,000	31,509	-	-	-	263,509
C Pougnault	261,835	-	23,565	-	-	-	285,400
J Stacpoole	37,489	-	1,367	-	-	-	38,856
S Lane	148,913	-	13,402	-	-	-	162,315
Total Key
Management
Personnel
Compensation	1,373,317	32,000	135,686	-	-	136,219	1,677,222

• 1) For details of shares and options issued to KMP refer to Note (24) “Share based Payments”.

• 2) Mr Vinar receives a motor vehicle as part of his remuneration package, with a deemed value of $32,000 per annum.

3) Dr Ward and Mr Lane receive a motor vehicle allowance paid as part of their cash remuneration, valued at $37,000 and $32,000 per annum respectively. Mr Lane resigned on 31 January 2013.

• 4) Dr Ward commenced duties on 30 July 2013.

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REMUNERATION REPORT (AUDITED)

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2012 Short-Term Employee Post-Employment Share-Based
Benefi ts Benefi ts Payments
Name Cash Salary Non- Super- Termination Shares Options Total
And Fees Monetary annuation Benefi ts $ $ $
$ Benefi ts $ $
$
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G George	69,650	-	4,950	-	-	-	74,600
A Tsang	50,000	-	4,500	-	-	-	54,500
B Chow	50,000	-	4,500	-	-	-	54,500
E Loh	18,877	-	-	-	-	-	18,877
J Vinar	191,558	32,000	20,120	-	30,000	16,000	289,678
C Pougnault	210,456	-	19,024	-	30,000	16,000	275,480
G Bromley	290,362	-	48,785	253,999	-	-	593,146
K Pettit	43,544	-	4,488	-	-	-	48,032
J Stacpoole	43,189	-	-	-	-	-	43,189
S Lane	222,728	-	20,120	-	30,000	16,000	288,848
Total Key
Management
Personnel
Compensation	1,190,364	32,000	126,487	253,999	90,000	48,000	1,740,850
Other
Executives
A Francesca	-	84,691	-	-	-	-	84,691
Total Other
Executives	-	84,691	-	-	-	-	84,691

• 1) For details of shares and options issued to KMP refer to Note (24) “Share based Payments”.

• 2) Mr Vinar received a motor vehicle as part of his remuneration package, with a deemed value of $32,000 per annum.

• 3) Mr Lane received a motor vehicle allowance valued at $32,000 per annum as part of his remuneration.

• 4) Of Mr Francesca’s fees $64,611 (2011: $69,600) relates to the Company Secretarial function with the balance for additional taxation, accounting and corporate services, paid to FJH Solutions Pty Ltd, (of which Mr Francesca is a director). Mr Francesca resigned as Company Secretary in April 2012.

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SHARE BASED COMPENSATION

For each grant of options included in remuneration above, the percentage of the grant that was paid, or that was vested, in the fi nancial year, and the percentage that was forfeited because the person did not meet the service and performance criteria is set out below.

Name G George*	Year Of Grant 2012	Number Of Options Granted 1,000,000	Value Of Options At Grant Date $34,600	Number Of Options Vested During The Year -	Number Of Options Forfeited During The Year -	Value At Lapse Date -	% Vested -
S Ward**	2012	4,000,000	$138,400	-	-	-	-
A Tsang*	2012	500,000	$17,300	-	-	-	-
B Chow*	2012	500,000	$17,300	-	-	-	-
E Loh*	2012	500,000	$17,300	-	-	-	-

Note: * These key management personnel were issued unlisted options on 10 December 2012 as approved by shareholders at the Company’s 2012 Annual General Meeting. The unlisted options are deemed performance based as they are exercisable at a price higher than the prevailing share price at the time of approval by shareholders.

** Dr Steve Ward was issued four million unlisted options on 9 November 2012 pursuant to his employment agreement. The unlisted options are deemed performance based as they are exercisable at a price higher than the prevailing share price at the time of approval by shareholders. Refer to note (17): Key Management Personnel for details.

There were no shares issued from the exercise of options provided as remuneration provided to Key Management Personnel during the current reporting period.

Details of options over ordinary shares issued by the Company during the fi nancial year as remuneration to each of key management personnel of the Company are set out below. When exercisable, each option is convertible into one ordinary share of Mindax Limited. Further information on the options is set out in Notes (17) and (24) to the fi nancial statements.

The terms and conditions of each grant of options aff ecting remuneration in the current or a future reporting period are as follows:

Grant Date	Vesting And Exercise Date	Expiry Date	Exercise Price	Value Per Option At Grant Date	Performance Achieved	% Vested
9 November	9 November	9 November	$0.108	$0.035	-	0%
2012	2013	2015
3 December	3 December	3 December	$0.11	$0.035	-	0%
2012	2013	2015

Options granted under the plan carry no dividend or voting rights.

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REMUNERATION REPORT (AUDITED)

SECURITIES RECEIVED THAT ARE PERFORMANCE RELATED

Other that the options set out above, no members of Key Management Personnel received additional securities during the period which were dependent upon the performance of the Company’s share price as part of their remuneration package.

USE OF REMUNERATION CONSULTANTS

The Company did not engage any remuneration consultants during the 2013 fi nancial year.

VOTING AND COMMENTS MADE AT THE COMPANY’S 2012 ANNUAL GENERAL MEETING

Of the eligible shareholders able to vote on the resolution, Mindax received unanimous approval on its remuneration report for the 2012 fi nancial year. The Company did not receive any specifi c feedback at the AGM or throughout the year on its remuneration practices.

END OF AUDITED REMUNERATION REPORT AND END OF DIRECTORS’ REPORT

The Directors’ Report, including the Operations and Financial Review and Remuneration Report, is signed in accordance with a resolution of the Board of Directors:

On behalf of the Directors

Dr Steve Ward Managing Director and Chief Executive Offi cer

Dated this 19th day of September 2013

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Tel: +8 6382 4600 Fax: +8 6382 4601 www.bdo.com.au

38 Station Street Subiaco, WA 6008 PO Box 700 West Perth WA 6872 Australia

19 September 2013

Board of Directors Mindax Limited Level 2, 25 Richardson St West Perth WA 6005

Dear Sirs,

DECLARATION OF INDEPENDENCE BY PHILLIP MURDOCH TO THE DIRECTORS OF MINDAX LIMITED

As lead auditor of Mindax Limited for the year ended 30 June 2013, I declare that, to the best of my knowledge and belief, there have been no contraventions of:

• the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and

• any applicable code of professional conduct in relation to the audit.

This declaration is in respect of Mindax Limited and the entities it controlled during the period.

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Phillip Murdoch Director

BDO Audit (WA) Pty Ltd Perth, Western Australia

BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO (Australia) Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO (Australia) Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation (other than for the acts or omissions of financial services licensees) in each State or Territory other than Tasmania.

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DIRECTORS’ DECLARATION

In the directors’ opinion:

1. The fi nancial statements and notes set out on pages 57 to 91 are in accordance with the Corporations Act 2001 (Commonwealth), including:

2. (a) complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements, and

3. (b) give a true and fair view of the consolidated entity’s fi nancial position as at 30 June 2013 and of its performance for the fi nancial year ended on that date, and

4. There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

5. Note (1) confi rms that the fi nancial statements also comply with International Financial Reporting Standards as issued by the International Accounting Standards Board.

6. The directors have been given the declarations by the Chief Executive Offi cer and Chief Financial Offi cer required by section 295A of the Corporations Act 2001.

This declaration is made in accordance with a resolution of the Board of Directors.

On behalf of the Directors

Dr Steve Ward Managing Director and Chief Executive Offi cer

Dated this 19th day of September 2013

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Tel: +8 6382 4600 Fax: +8 6382 4601 www.bdo.com.au

38 Station Street Subiaco, WA 6008 PO Box 700 West Perth WA 6872 Australia

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF MINDAX LIMITED

Report on the Financial Report

We have audited the accompanying financial report of Mindax Limited, which comprises the consolidated balance sheet as at 30 June 2013, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, notes comprising a summary of significant accounting policies and other explanatory information, and the directors’ declaration of the consolidated entity comprising the company and the entities it controlled at the year’s end or from time to time during the financial year.

Directors’ Responsibility for the Financial Report

The directors of the company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In Note 1, the directors also state, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements , that the financial statements comply with International Financial Reporting Standards .

Auditor’s Responsibility

Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. Those standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance about whether the financial report is free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the company’s preparation of the financial report that gives a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the rekasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Independence

In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001 . We confirm that the independence declaration required by the Corporations Act 2001 , which has been given to the directors of Mindax Limited, would be in the same terms if given to the directors as at the time of this auditor’s report.

BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO (Australia) Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO (Australia) Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation (other than for the acts or omissions of financial services licensees) in each State or Territory other than Tasmania.

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Opinion

In our opinion:

• (a) the financial report of Mindax Limited is in accordance with the Corporations Act 2001 , including:

• (i) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2013 and of its performance for the year ended on that date; and

• (ii) complying with Australian Accounting Standards and the Corporations Regulations 2001 ; and

• (b) the financial report also complies with International Financial Reporting Standards as disclosed in Note 1.

Emphasis of Matter

Without modifying our opinion, we draw attention to Note 1 in the financial report, which indicates that the consolidated entity incurred a net loss of $1,814,133 during the year ended 30 June 2013 and incurred net cash outflows from operations of $701,023. These conditions, along with other matters as set forth in Note 1, indicate the existence of a material uncertainty that may cast significant doubt about consolidated entity’s ability to continue as a going concern and therefore, the company may be unable to realise its assets and discharge its liabilities in the normal course of business.

Report on the Remuneration Report

We have audited the Remuneration Report included in the directors’ report for the year ended 30 June 2013. The directors of the company are responsible for the preparation and presentation of the Remuneration Report in accordance with Section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.

Opinion

In our opinion, the Remuneration Report of Mindax Limited for the year ended 30 June 2013 complies with Section 300A of the Corporations Act 2001 .

BDO Audit (WA) Pty Ltd

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Phillip Murdoch Director

Perth, Western Australia Dated the 19[th] day of September 2013

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FINANCIAL STATEMENTS

CONSOLIDATED STATEMENT OF PROFIT AND LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2013

Note	2013 2012 $ $
Revenue from continuing operations (2) Advertising Exploration expenditure written of (8) Compliance and regulatory expenses Legal and professional expenses Depreciation and amortisation expense Directors fees Remuneration and employee expenses Share based payments – director & employee options (24) Travel expenses Other expenses LOSS BEFORE INCOME TAXES Income tax expense (3) Other comprehensive income TOTAL COMPREHENSIVE LOSS FOR THE YEAR LOSS FROM CONTINUING OPERATIONS ATTRIBUTABLE TO OWNERS OF THE PARENT ENTITY EARNINGS PER SHARE	1,577,423 900,679 (73,193) (83,565) (952,530) (153,720) (48,215) (55,451) (435,757) (1,159,097) (17,653) (25,033) (289,388) (214,006) (1,032,180) (842,948) (115,419) (146,000) (192,962) (142,439) (234,259) (377,633)
	(1,814,133) (2,299,213)
	- -
	- -
	(1,814,133) (2,299,213)
	(1,814,133) (2,299,213)
	2013 2012
Basic earnings (loss) per share (cents) (13) Diluted earnings (loss) per share (cents) (13)	(0.812) (1.32) N/A N/A

The above consolidated statement of P&L and Other Income should be read in conjunction with the accompanying notes.

FINANCIAL STATEMENTS

CONSOLIDATED BALANCE SHEET AS AT 30 JUNE 2013

Note

2013 2012 $ $

ASSETS CURRENT ASSETS Cash and cash equivalents (4) Trade and other receivables (5) Prepayments (6) TOTAL CURRENT ASSETS NON CURRENT ASSETS Prepayments (6) Plant and equipment (7) Other assets Exploration and evaluation assets (8) TOTAL NON CURRENT ASSETS TOTAL ASSETS LIABILITIES CURRENT LIABILITIES Trade and other payables (9) Provisions (10) TOTAL CURRENT LIABILITIES NON CURRENT LIABILITIES Provisions (10) TOTAL NON CURRENT LIABILITIES TOTAL LIABILITIES NET ASSETS EQUITY Issued capital (11) Reserves (12) Accumulated losses (12) TOTAL EQUITY

3,459,634 2,201,405 234,475 162,842 58,893 42,210 3,753,002 2,406,457 60,000 - 244,070 278,931 2,885 2,885 24,160,253 20,718,976 24,467,208 21,000,792 28,220,210 23,407,249 1,431,315 423,466 126,439 100,637 1,557,754 524,103 - - - - 1,557,754 524,103 26,662,456 22,883,146 39,353,930 33,875,906 795,570 680,151 (13,487,044) (11,672,911) 26,662,456 22,883,146

The above consolidated balance sheet should be read in conjunction with the accompanying notes.

FINANCIAL STATEMENTS

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2013NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

2012	Ordinary Shares $ Accumulated Losses $ Share Based Payment Reserve $ Total $
Balance at 1 July 2011 Prof t (loss) attributable to owners of the parent entity Adjustment to prior year accumulated losses Other comprehensive income Total comprehensive income for the year Shares issued during the year Shares issued during the year under the Company employee share scheme Options issued during the year under the Company employee option scheme Transaction costs Sub-total Balance at 30 June 2012 2013	27,752,473 (9,369,973) 624,151 19,006,651 - (2,299,213) - (2,299,213) - (3,725) - (3,725) - - - -
	- (2,302,938) - (2,302,938)
	6,500,708 - - 6,500,708 90,000 - - 90,000 - - 56,000 56,000 (467,275) - - (467,275)
	6,123,433 (2,302,938) 56,000 3,876,495
	33,875,906 (11,672,911) 680,151 22,883,146
	Ordinary Shares $ Accumulated Losses $ Share Based Payment Reserve $ Total $
Balance at 1 July 2012 Prof t (loss) attributable to owners of the parent entity Other comprehensive income Total comprehensive income for the year Shares issued during the year Options issued during the year under the Company employee option scheme Options cancelled during the year under the Company employee option scheme Transaction costs Sub total Balance at 30 June 2013	33,875,906 (11,672,911) 680,151 22,883,146 - (1,814,133) - (1,814,133) - - - -
	- (1,814,133) - (1,814,133)
	5,735,868 - - 5,735,868 - - 136,219 136,219 - - (20,800) (20,800) (257,844) - - (257,844)
	5,478,024 (1,814,133) 115,419 3,779,310
	39,353,930 (13,487,044) 795,570 26,662,456

The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSCONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2013

Statement Of Cash Flows Note	2013 2012 $ $
CASH FLOWS FROM OPERATING ACTIVITIES: Payments to suppliers and employees Interest received Due diligence exclusivity fee Research and development tax concession Net cash used in operating activities (22) CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property, plant and equipment Proceeds from sale of property, plant and equipment Meekatharra North Joint Venture Funding Payment for exploration expenditure Net cash used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from issue of shares Payment of share issue costs Net cash from f nancing activities Net (decrease) increase in cash and cash equivalents held Cash and cash equivalents at beginning of f nancial year	(2,269,721) (2,753,307) 121,186 197,240 250,000 - 1,197,512 702,768 (701,023) (1,853,299) (26,012) (39,706) - 55,000 500,000 - (3,992,760) (3,955,991) (3,518,772) (3,940,697) 5,735,868 6,500,708 (257,844) (479,683) 5,478,024 6,021,025 1,258,229 227,029 2,201,405 1,974,376 3,459,634 2,201,405
CASH AND CASH EQUIVALENTS AT END OF FINANCIAL YEAR: (4)

The above consolidated statement of cash fl ow should be read in conjunction with the accompanying notes.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

This fi nancial report includes the consolidated fi nancial statements and notes of Mindax Limited and controlled entities (the Group).

1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Mindax Limited is a company limited by shares, incorporated and domiciled in Australia.

These general purpose fi nancial statements have been prepared in accordance with Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board (AASB) and the Corporations Act. Mindax Limited is a for-profi t entity for the purpose of preparing the fi nancial statements.

Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a fi nancial report containing relevant and reliable information about transactions, events and conditions. Compliance with Australian Accounting Standards ensures that the fi nancial statements and notes also comply with International Financial Reporting Standards. Material accounting policies adopted in the preparation of this fi nancial report are presented below and have been consistently applied unless otherwise stated.

The fi nancial report has been prepared on an accruals basis and is based on historical costs, modifi ed, where applicable, by the measurement at fair value of selected fi nancial assets and fi nancial liabilities.

These fi nancial statements are presented in Australian dollars, rounded to the nearest dollar.

Principles of Consolidation

The consolidated fi nancial statements incorporate the assets, liabilities and results of entities controlled by Mindax Limited at the end of the reporting period. A controlled entity is any entity over which Mindax Limited has the power to govern the fi nancial and operating policies so as to obtain benefi ts from the entity’s activities. Control will generally exist when the parent owns, directly or indirectly through subsidiaries, more than half of the voting power of an entity. In assessing the power to govern, the existence and eff ect of holdings of actual and potential voting rights are also considered.

Where controlled entities have entered or left the Group during the year, the fi nancial performance of those entities are included only for the period of the year that they were controlled. A list of controlled entities is contained in Note (19) to the fi nancial statements.

As at reporting date, the assets and liabilities of all controlled entities have been incorporated into the consolidated fi nancial statements as well as their results for the year then ended. Where controlled entities have entered (left) the Group during the year, their operating results have been included (excluded) from the date control was obtained (ceased).

In preparing the consolidated fi nancial statements, all inter group balances and transactions between entities in the Group have been eliminated on consolidation. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with those adopted by the parent entity.

Non controlling interests, being the equity in a subsidiary not attributable, directly or indirectly, to a parent, are shown separately within the Equity section of the consolidated statement of fi nancial position and consolidated statement of comprehensive income. The non controlling interests in the net assets comprise their interests at the date of the original business combination and their share of changes in equity since that date.

Revenue and Other Income

Revenue is measured at the fair value of the consideration received or receivable after taking into account any trade discounts and volume rebates allowed. Any consideration deferred is treated as the provision of fi nance and is discounted at a rate of interest that is generally accepted in the market for similar arrangements. The diff erence between the amount initially recognised and the amount ultimately received is interest revenue.

Interest revenue is recognised using the eff ective interest rate method, which, for fl oating rate fi nancial assets, is the rate inherent in the instrument.

Government grants (Research and development)

Grants from the government are recognised as other income at their fair value where there is a reasonable assurance that the grant will be received and the Group will comply with all attached conditions.

All grant revenue is stated net of the amount of goods and services tax (GST).

The Group has recognised research and development tax concession rebates received from the Australian Tax Offi ce as revenue. No GST applies to these rebates.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Income Tax

The income tax expense (revenue) for the year comprises current income tax expense (income) and deferred tax expense (income).

Current income tax expense charged to the profi t or loss is the tax payable on taxable income calculated using applicable income tax rates enacted, or substantially enacted, as at the end of the reporting period. Current tax liabilities (assets) are therefore measured at the amounts expected to be paid to (recovered from) the relevant taxation authority.

Deferred income tax expense refl ects movements in deferred tax asset and deferred tax liability balances during the year as well as unused tax losses.

Current and deferred tax expense (income) is charged or credited directly to equity instead of the profi t or loss when the tax relates to items that are credited or charged directly to equity.

Deferred tax assets and liabilities are ascertained based on temporary diff erences arising between the tax bases of assets and liabilities and their carrying amounts in the fi nancial statements. Deferred tax assets also result where amounts have been fully expensed but future tax deductions are available. No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a business combination, where there is no eff ect on accounting or taxable profi t or loss.

Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled, based on tax rates enacted or substantively enacted at the end of the reporting period. Their measurement also refl ects the manner in which management expects to recover or settle the carrying amount of the related asset or liability.

Deferred tax assets relating to temporary diff erences and unused tax losses are recognised only to the extent that it is probable that future taxable profi t will be available against which the benefi ts of the deferred tax asset can be utilised.

Where temporary diff erences exist in relation to investments in subsidiaries, branches, associates, and joint ventures, deferred tax assets and liabilities are not recognised where the timing of the reversal of the temporary diff erence can be controlled and it is not probable that the reversal will occur in the foreseeable future.

Current assets and liabilities are off set where a legally enforceable right of set off exists and it

is intended that net settlement or simultaneous realisation and settlement of the respective asset and liability will occur. Deferred tax assets and liabilities are off set where a legally enforceable right of set off exists, the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or diff erent taxable entities where it is intended that net settlement or simultaneous realisation and settlement of the respective asset and liability will occur in future periods in which signifi cant amounts of deferred tax assets or liabilities are expected to be recovered or settled.

The Company and all its wholly owned Australian resident entities are part of a tax consolidated group under Australian taxation law. Mindax Limited is the head entity in the tax consolidated group. Tax expense/income, deferred tax liabilities and deferred tax assets arising from temporary diff erences of the members of the tax consolidated group are recognised in the separate fi nancial statements of the members of the tax consolidated group using the separate taxpayer within group approach.

Employee Benefi ts

Provision is made for the Group’s liability for employee benefi ts arising from services rendered by employees to the end of the reporting period. Employee benefi ts that are expected to be settled within one year have been measured at the amounts expected to be paid when the liability is settled. Employee benefi ts payable later than one year have been measured at present value of the estimated future cash outfl ows to be made for those benefi ts. In determining the liability, consideration is given to employee wage increases and the probability that the employee may satisfy vesting requirements. Those cashfl ows are discounted using market yields on national government bonds with terms to maturity that match the expected timing of cashfl ows.

Provisions

Provisions are recognised when the Group has a legal or constructive obligation, as a result of past events, for which it is probable that an outfl ow of economic benefi ts will result and that outfl ow can be reliably measured.

Foreign Currency Transactions and Balances

The functional currency of each of the Group’s entities is measured using the currency of the primary economic environment in which that entity operates. The consolidated fi nancial statements are

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

presented in Australian dollars which is the parent entity’s functional and presentation currency. All other companies within the Group have Australian dollars as their functional currency.

Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date of the transaction. Foreign currency monetary items are translated at the year end exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Nonmonetary items measured at fair value are reported at the exchange rate at the date when fair values were determined.

Exchange diff erences arising on the translation of monetary items are recognised in the consolidated statement of comprehensive income, except where deferred in equity as a qualifying cash fl ow or net investment hedge.

Exchange diff erences arising on the translation of non monetary items are recognised directly in equity to the extent that the gain or loss is directly recognised in equity otherwise the exchange diff erence is recognised in the consolidated statement of comprehensive income.

The fi nancial results and position of foreign operations whose functional currency is diff erent from the Group’s presentation currency are translated as follows:

• assets and liabilities are translated at year end exchange rates prevailing at that reporting date;

• income and expenses are translated at average exchange rates for the year; and

• retained earnings are translated at the exchange rates prevailing at the date of the transaction.

Exchange diff erences arising on translation of foreign operations are transferred directly to the Group’s foreign currency translation reserve in the consolidated balance sheet. These diff erences are recognised in the consolidated statement of comprehensive income in the period in which the operation is disposed.

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within short-term borrowings in current liabilities in the statement of fi nancial position.

Financial Instruments

Initial recognition and measurement

Financial assets and fi nancial liabilities are recognised when the entity becomes a party to the contractual provisions to the instrument. For fi nancial assets, this is the equivalent to the date that the Group commits itself to either the purchase or sale of the asset (i.e. trade date accounting is adopted).

Financial instruments are initially measured at fair value plus transactions costs, except where the instrument is classifi ed ‘at fair value through profi t or loss’, in which case transaction costs are expensed to profi t or loss immediately.

Classifi cation and subsequent measurement

Financial instruments are subsequently measured at either fair value, amortised cost using the eff ective interest rate method, or at cost. Fair value represents the amount for which an asset could be exchanged or a liability settled, between knowledgeable, willing parties. Where available, quoted prices in an active market are used to determine fair value. In other circumstances, valuation techniques are adopted.

Amortised cost is calculated as:

• a) the amount at which the fi nancial asset or fi nancial liability is measured at initial recognition;

• b) less principal repayments;

• c) plus or minus the cumulative amortisation of the diff erence, if any, between the amount initially recognised and the maturity amount calculated using the eff ective interest method; and

• d) less any reduction for impairment.

The eff ective interest method is used to allocate interest income or interest expense over the relevant period and is equivalent to the rate that exactly discounts estimated future cash payments or receipts (including fees, transaction costs and other premiums or discounts) through the expected life (or when this cannot be reliably predicted, the contractual term) of the fi nancial instrument to the net carrying amount of the fi nancial asset or fi nancial liability. Revisions to expected future net cash fl ows will necessitate an adjustment to the carrying value with a consequential recognition of an income or expense in profi t or loss.

The Group does not designate any interests in subsidiaries, associates or joint venture entities as being subject to the requirements of accounting standards specifi cally applicable to fi nancial instruments.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Loans and receivables

Loans and receivables are non derivative fi nancial assets with fi xed or determinable payments that are not quoted in an active market and are subsequently measured at amortised cost. Loans and receivables are included in current assets, except for those which are not expected to mature within 12 months after the end of the reporting period.

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CLASS OF FIXED ASSET USEFUL LIFE
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Plant and Equipment	2 - 15 years
Mr Forrest Iron Project -	2 - 10 years
Camp site

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

Financial liabilities

The fair value of fi nancial liabilities for disclosure purposes is estimated by discounting the future contractual cash fl ows at the current market interest rate that is available to the Group for similar fi nancial instruments. The fair value of current borrowings approximates the carrying amount, as the impact of discounting is not signifi cant.

Derecognition

Financial assets are derecognised where the contractual rights to receipt of cash fl ows expires or the asset is transferred to another party whereby the entity no longer has any signifi cant continuing involvement in the risks and benefi ts associated with the asset. Financial liabilities are derecognised where the related obligations are either discharged, cancelled or expired. The diff erence between the carrying value of the fi nancial liability extinguished or transferred to another party and the fair value of consideration paid, including the transfer of noncash assets or liabilities assumed is recognised in profi t or loss.

Plant and Equipment

Each class of plant and equipment is carried at cost or fair value as indicated, less, where applicable, any accumulated depreciation and impairment losses.

Plant and equipment are measured on the cost basis.

Depreciation

The depreciable amount of all fi xed assets is depreciated on a straight-line basis over the asset’s useful life to the Group commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements. The estimated useful lives used for each class of depreciable assets are:

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are included in the consolidated statement of comprehensive income.

Property, plant and equipment is derecognised and removed from the consolidated balance sheet on disposal or when no future economic benefi ts are expected. Gains and losses from derecognition are measured as the diff erence between the net disposal proceeds, if any, and the carrying amount and are recognised in profi t or loss.

Subsequent costs are included in the property, plant and equipment’s carrying value or recognised as a separate asset when it is probable that future economic benefi ts associated with the item will be realised and the cost of the item can be measured reliably. All other repairs and maintenance are recognised in profi t or loss.

Exploration and Evaluation Expenditure

Exploration and evaluation expenditures are accumulated in respect of each separate area of interest.

Exploration and evaluation costs are carried forward where right of tenure of the area of interest is current and they are expected to be recouped through sale or successful development and exploitation of the area of interest, or, where exploration and evaluation activities in the area of interest have not yet reached a stage that permits reasonable assessment of the existence of economically recoverable reserves.

Development costs related to an area of interest are carried forward to the extent that they are expected to be recouped either through sale or successful exploitation of the area of interest.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

When an area of interest is abandoned or the directors decide that it is not commercial, any accumulated expenditures in respect of that area are written off in the fi nancial period the decision is made.

Contributed equity

Ordinary shares are classifi ed as equity. Incremental costs directly attributable to the issue of new shares or options are shown as a deduction, net of tax, from the proceeds.

Impairment of Assets

At each reporting date, the Group assesses whether there is any indication that an asset may be impaired. The assessment will include considering external sources of information including, dividends received from subsidiaries, associates or jointly controlled entities deemed to be out of pre acquisition profi ts. If such an indication exists, an impairment test is carried out on the asset by comparing the recoverable amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use to the asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is expensed to the consolidated statement of comprehensive income.

Impairment testing is performed annually for goodwill and intangible assets with indefi nite lives.

Where an impairment loss on a revalued asset is identifi ed, this is debited against the revaluation surplus in respect of the same class of asset to the extent that the impairment loss does not exceed the amount in the revaluation surplus for that same class of asset.

Non fi nancial assets, other than inventories, deferred tax assets, assets from employee benefi ts, and deferred acquisition costs, are assessed for any indication of impairment at the end of each reporting period. Any indication of impairment requires formal testing of impairment by comparing the carrying amount of the asset to an estimate of the recoverable amount of the asset. An impairment loss is calculated as the amount by which the carrying amount of the asset exceeds the recoverable amount of the asset.

Intangible assets with an indefi nite useful life and intangible assets not yet available for use are tested for impairment annually regardless of whether there is any indication of impairment.

The recoverable amount is the greater of the asset’s fair value less costs to sell and its value in use. The asset’s value in use is calculated as the estimated future cash fl ows discounted to their present value using a pre-tax rate that refl ects current market assessments of the time value of money and the risks associated with the asset. Assets that cannot be tested individually for impairment are grouped together into the smallest group of assets that generates cash infl ows (the asset’s cash generating unit).

Impairment losses are recognised in profi t or loss. Impairment losses are allocated fi rst, to reduce the carrying amount of any goodwill allocated to cash generating units, and then to other assets of the Group on a pro rata basis.

Assets other than goodwill are assessed at the end of each reporting period to determine whether previously recognised impairment losses may no longer exist or may have decreased. Impairment losses recognised in prior periods for assets other than goodwill are reversed up to the carrying amounts that would have been determined had no impairment loss been recognised in prior periods.

Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance of the operating segments, is the Chief Executive Offi cer and Managing Director, Dr Steve Ward.

Trade and other payables

Trade and other payables represent the liability outstanding at the end of the reporting period for goods and services received by the Group during the reporting period which remain unpaid. The balance is recognised as a current liability with the amounts normally paid within 30 days of recognition of the liability.

Goods and Services Tax (GST)

Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Tax Offi ce. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the consolidated balance sheet are shown inclusive of GST.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Leases

Leasing of fi xed assets, where substantially all the risks and benefi ts incidental to the ownership of the asset but not the legal ownership that are transferred to entities in the Group, are classifi ed as fi nance leases.

Finance leases are capitalised by recording an asset and a liability at the lower of the amounts equal to the fair value of the leased property or the present value of the minimum lease payments, including any guaranteed residual values. Lease payments are allocated between the reduction of the lease liability and the lease interest expense for the year. Lease payments for operating leases, where substantially all of the risks and benefi ts remain with the lessor, are charged as expenses in the periods in which they are incurred.

Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to ready for its intended use are capitalised as part of the cost of the asset.

Other borrowing costs are expensed in the period in which they occur. Borrowing costs consists of fi nance charges and interest expenses calculated using the eff ective interest method, and include exchange diff erences arising from foreign currency borrowings to the extent that they are regarded as interest cost adjustments.

Earnings per share

Basic loss per share is calculated as net loss attributable to owners of the Company divided by the weighted average number of ordinary shares. Diluted loss per share is calculated by adjusting the net loss attributable to owners of the Company and the number of shares outstanding for the eff ects of all dilutive potential ordinary shares, which include shares options.

Share based payment transactions

Employees of the Group receive remuneration in the form of share based payment transactions, whereby employees render services in exchange for equity instruments (“equity settled transactions”).

When the goods or services acquired in a share based payment transaction do not qualify for recognition as assets, they are recognised as expenses.

The cost of equity settled transactions and the

corresponding increase in equity is measured at the fair value of the goods or services acquired. Where the fair value of the goods or services received cannot be reliably estimated, the fair value is determined indirectly by the fair value of the equity instruments using the Black Scholes option valuation technique.

Equity settled transactions that vest after employees complete a specifi ed period of service are recognised as services are received during the vesting period with a corresponding increase in equity.

Critical Accounting Estimates and Judgments

The directors evaluate estimates and judgments incorporated into the fi nancial statements based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the Group.

Share based payments

The Group measures the cost of equity settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by using a Black and Scholes formula taking into account the terms, conditions and probability upon which the instruments were granted.

Key judgments Exploration and Evaluation Expenditure

The Group capitalises expenditure relating to exploration and evaluation where it is considered likely to be recoverable or where the activities have not reached a stage which permits a reasonable assessment of the existence of reserves. While there are certain areas of interest from which no reserves have been extracted, the directors are of the continued belief that such expenditure should not be written off since feasibility studies in such areas have not yet concluded.

Key Estimates - Impairment

The future recoverability of capitalised exploration and evaluation expenditure is dependent on a number of factors, including whether the Group decides to exploit the related lease itself or, if not, whether it successfully recovers the related exploration and evaluation asset through sale.

Factors that could impact the future recoverability include the level of reserves and resources, future

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

technological changes, costs of drilling and production, production rates, future legal changes (including changes to environmental restoration obligations) and changes to commodity prices.

Mineral Resources Rent Tax

On 19 March 2012, the Australian Government passed through the Senate, the Minerals Resource Rent Tax Act 2012, with application to certain profi ts arising from the iron ore and coal extracted in Australia. In broad terms, the tax is imposed on a project-byproject basis.

This tax applies to upstream mining operations only, and the eff ective rate of Minerals Resource Rent Tax is 22.5%.

This tax is considered to be an “income tax” for the purposes of AASB 112.

Certain transition measures are contained in the legislation which can give rise to deductions in future years, for Minerals Resource Rent Tax purposes.

Any modelling and/or valuations performed on behalf of the Group may give rise to an increase in the balance of deferred tax assets at 30 June 2013. However, given the nature of the Group’s operations (i.e.: primarily exploration) and the infancy of the Group’s Iron Ore project, the Group has not recognised such amounts as at 30 June 2013 under Deferred Tax Assets (refer to Note (3): Income Tax Expense).

Going concern

The fi nancial report has been prepared on a going concern basis, which contemplates the continuity of normal business activity and the realisation of assets and the settlement of liabilities in the normal course of business.

During the year the consolidated entity incurred a net loss of ($1,814,133) and incurred net cash outfl ows from operating activities of ($701,023).

The ability of the consolidated entity to continue as a going concern is dependent on the continued support of its strategic (JV) partners and the consolidated entity being able to raise additional funds as required to fund ongoing exploration commitments, conduct feasibility studies on the Company’s projects and for working capital. The directors believe that they will be able to raise additional capital as required and are in the process of evaluating the consolidated entity’s cash requirements. The directors believe that the consolidated entity will continue as a going concern. As a result the fi nancial report has been prepared on a going concern basis. However should the consolidated entity be unsuccessful in undertaking additional raisings, or continue with funding from joint venture partnerships, the consolidated entity may not be able to continue as a going concern. No adjustments have been made relating to the recoverability of assets and classifi cation of liabilities that might be necessary should the consolidated entity not continue as a going concern.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

New Accounting Standards and Interpretations

Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2013 reporting periods and have not been early adopted by the Group. The Group’s assessment of the impact of these new standards and interpretations is set out below.

• AASB 9 Financial Instruments addresses the classifi cation, measurement and derecognition of fi nancial assets and fi nancial liabilities. The standard is not applicable until 1 January 2015 but is available for early adoption. When adopted, the standard will aff ect in particular the Group’s accounting for its available-for-sale fi nancial assets, since AASB 9 only permits the recognition of fair value gains and losses in other comprehensive income if they relate to equity investments that are not held for trading. Fair value gains and losses on available-for-sale debt investments, for example, will therefore have to be recognised directly in profi t or loss.

• There will be no impact on the Group’s accounting for fi nancial liabilities, as the new requirements only aff ect the accounting for fi nancial liabilities that are designated at fair value through profi t or loss and the Group does not have any such liabilities. The derecognition rules have been transferred from AASB 139 Financial Instruments: Recognition and Measurement and have not been changed. The Group has not yet decided when to adopt AASB 9.

• In August 2011, the AASB issued a suite of new and amended standards which address the accounting for joint arrangements, consolidated fi nancial statements and associated disclosures.

• AASB 10 replaces all of the guidance on control and consolidation in AASB 127 Consolidated and Separate Financial Statements, and Interpretation 12 Consolidation – Special Purpose Entities. The core principle that a consolidated entity presents a parent and its subsidiaries as if they are a single economic entity remains unchanged, as do the mechanics of consolidation. However, the standard introduces a single defi nition of control that applies to all entities. It focuses on the need to have both power and rights or exposure to variable returns. Power is the current ability to direct the activities that signifi cantly infl uence returns. Returns must vary and can

be positive, negative or both. Control exists when the investor can use its power to aff ect the amount of its returns. There is also new guidance on participating and protective rights and on agent/principal relationships. While the Group does not expect the new standard to have a signifi cant impact on its composition, it has yet to perform a detailed analysis of the new guidance in the context of its various investees that may or may not be controlled under the new rules.

• AASB 11 introduces a principles based approach to accounting for joint arrangements. The focus is no longer on the legal structure of joint arrangements, but rather on how rights and obligations are shared by the parties to the joint arrangement. Based on the assessment of rights and obligations, a joint arrangement will be classifi ed as either a joint operation or a joint venture. Joint ventures are accounted for using the equity method, and the choice to proportionately consolidate will no longer be permitted. Parties to a joint operation will account for their share of revenues, expenses, assets and liabilities in much the same way as under the previous standard. AASB 11 also provides guidance for parties that participate in joint arrangements but do not share joint control.

The Group’s investment in any new formal joint venture partnerships will be classifi ed as joint ventures under the new rules. As the Group already applies the equity method in accounting for such investments, AASB 11 will not have any impact on the amounts recognised in its future fi nancial statements.

• AASB 12 sets out the required disclosures for entities reporting under the two new standards, AASB 10 and AASB 11, and replaces the disclosure requirements currently found in AASB 127 and AASB 128. Application of this standard by the Group will not aff ect any of the amounts recognised in the fi nancial statements, but will impact the type of information disclosed in relation to the Group’s Investments.

• Amendments to AASB 128 provide clarifi cation that an entity continues to apply the equity method and does not remeasure its retained interest as part of ownership

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

changes where a joint venture becomes an associate, and vice versa. The amendments also introduce a “partial disposal” concept. The Group is still assessing the impact of these amendments.

The Group will adopt the new standards from their operative date. They will therefore be applied in the fi nancial statements for the annual reporting period ending 30 June 2014.

Note however, that the Group’s Yilgarn-Avon Joint Venture and the Meekatharra North Joint Venture are considered to be a ‘strategic partnership’ and a ‘deferred farm-in/farm-out arrangement’ respectively; and as they don’t meet the defi nition of a Jointly Controlled Asset (Joint Operation) or Joint Venture Entity their separate disclosure is not required in this report.

AASB 13 was released in September 2011. It explains how to measure fair value and aims to enhance fair value disclosures. The Group has yet to determine which, if any, of its current measurement techniques will have to change as a result of the new guidance. It is therefore not possible to state the impact, if any, of the new rules on any of the amounts recognised in the fi nancial statements.

However, application of the new standard will impact the type of information disclosed in the notes to the fi nancial statements. The Group will adopt the new standard from its operative date, which means that it will be applied in the annual reporting period ending 30 June 2014.

AASB 119 (Revised) Employee Benefi ts - In September 2011, the AASB released a revised standard on accounting for employee benefi ts. It requires the recognition of all remeasurements of defi ned benefi t liabilities/assets immediately in other comprehensive income (removal of the so-called ‘corridor’ method), the immediate recognition of all past service cost in profi t or loss and the calculation of a net interest expense or income by applying the discount rate to the net defi ned benefi t liability or asset. This replaces the expected return on plan assets that is currently included in profi t or loss. The standard also introduces a number of additional disclosures for defi ned benefi t liabilities/assets and could aff ect the timing of the recognition of termination benefi ts. The amendments will have to be implemented retrospectively.

The Group will apply the new standard when it becomes operative, being from 1 July 2013.

There are no other standards that are not yet eff ective and that are expected to have a material impact on the entity in the current or future reporting periods and on foreseeable future transactions.

Parent entity fi nancial information

The fi nancial information for the parent entity, Mindax Limited, disclosed in Note (26) “Parent entity” has been prepared on the same basis as the consolidated fi nancial statements, except as set out below.

(i) Investments in subsidiaries, associates and joint venture entities

Investments in subsidiaries, associates and joint venture entities are accounted for at cost in the fi nancial statements of Mindax. Dividends received from associates are recognised in the parent entity’s profi t or loss when its right to receive the dividend is established.

(ii) Tax consolidation legislation

Mindax Limited and its wholly owned Australian controlled entities have implemented the tax consolidation legislation and are part of a taxconsolidated group. As a consequence, all members of the tax-consolidated group are taxed as a single entity. The head entity within the tax-consolidated group is Mindax Limited.

(iii) Financial guarantees

Where the parent entity has provided fi nancial guarantees in relation to loans and payables of subsidiaries for no compensation, the fair values of these guarantees are accounted for as contributions and recognised as part of the cost of the investment.

(iv) Share-based payments

The grant by the Company of options over its equity instruments to the employees of subsidiary undertakings in the Group is treated as a capital contribution to that subsidiary undertaking. The fair value of employee services received, measured by reference to the grant date fair value, is recognised over the vesting period as an increase to investment in subsidiary undertakings, with a corresponding credit to equity.

The Group does not anticipate early adoption of any of the above accounting standards.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

2) REVENUE AND OTHER INCOME

Revenue from continuing operations Interest revenue Other revenue Other income Research and development tax concession Interest income on research and development tax concession TFN credits Due diligence fee on Mt Forrest Project 3) INCOME TAX EXPENSE (a) The components of tax expense comprise: Current tax Deferred tax R & D tax concession (b) The prima facie tax on loss from ordinary activities before income tax is reconciled to the income tax as follows: Loss from continuing operations before income tax expense Income tax (benef t) at 30% (2012:30%) Add /(less): Tax ef ect of amounts which are (deductible)/taxable: – Share based payments – Tenement expenditure write-of – ITRAA 1997 s40 730 Exploration Expenditure – Write of for business related capital costs – Sundry non deductable items – Sundry non assessable items R & D tax concession Income tax expense/(benef t) not recognised Total income tax expense/(benef t)	2013 $ 2012 $
	125,001 166,974 3,914 30,937
	128,915 197,911 1,178,994 688,359 18,518 14,409 996 - 250,000 -
	1,448,508 702,768 1,577,423 900,679
	2013 $ 2012 $ - - - - - - (1,814,133) (2,299,213) (544,240) (689,764) 34,626 43,800 285,759 46,116 (1,318,142) (1,589,936) (97,908) (96,746) 29,766 103,821 (61,527) (73,975) (1,671,666) (2,256,684) (353,399) (206,508) 2,025,065 2,463,192 - -

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

3) INCOME TAX EXPENSE (continued)

) INCOME TAX EXPENSE (continued)
(c) Tax losses: Unused tax losses for which no deferred tax assets has been recognised Potential tax benef t at 30% (d) Unrecognised temporary dif erences: Deferred tax assets – Tax losses – Capital raising costs – Blackhole expenditure – Other temporary dif erences Deferred tax liabilities – Capitalised exploration expenditure – Other temporary dif erences Net deferred tax assets	2013 $ 2012 $
	34,078,739 29,946,294 10,223,622 8,983,888
	2013 $ 2012 $ 10,223,622 8,983,888 204,075 218,156 10,613 14,150 54,238 90,424 (7,248,076) (6,215,693) 1,178 754 3,245,650 3,091,679

The net deferred tax assets arising from these balances have not been recognised as an asset because recovery is not probable at the point in time. The recoupment of available tax losses as at the 30 June 2013 is contingent upon the following:

• (i) the Group deriving future assessable income of a nature and an amount suffi cient to enable the benefi t from the deductions for the losses to be realised;

• (ii) the Group continues to comply with the conditions for deductibility imposed by tax legislation in Australia; and

• (iii) there being no changes in tax legislation, adversely aff ect which adversely aff ect the Group from realising the benefi t.

4) CASH AND CASH EQUIVALENTS

) CASH AND CASH EQUIVALENTS
	2013 $	2012 $
Cash on hand	3,459,634	2,201,405

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

5) TRADE AND OTHER RECEIVABLES

) TRADE AND OTHER RECEIVABLES
CURRENT Sundry Debtors Term deposits	2013 $ 2012 $
	85,025 15,129 149,450 147,713
	234,475 162,842

Details of the Group’s exposure to risks arising from current trade and other receivables are set out in Note (15) “Financial Risk Management”.

Details on the Group’s term deposits, provided as security for bank guarantees, are set out in Note (20) “Contingent Asset & Liabilities”.

6) OTHER ASSETS (CURRENT)

) OTHER ASSETS (CURRENT)
CURRENT Prepayments NON-CURRENT Prepayments ) PLANT AND EQUIPMENT At cost Accumulated depreciation Campsite At cost Accumulated depreciation Total plant and equipment	2013 $ 2012 $
	58,893 42,210
	58,893 42,210
	60,000 -
	60,000 -
	2013 $ 2012 $
	582,378 568,783 (393,473) (342,608)
	188,905 226,175
	82,931 70,566 (27,766) (17,810)
	55,165 52,756
	244,070 278,931

7) PLANT AND EQUIPMENT

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

7) PLANT AND EQUIPMENT (continued)

MOVEMENTS IN CARRYING AMOUNTS

Movement in the carrying amounts for each class of plant and equipment between the beginning and the end of the current fi nancial year:

	Plant and Equipment $	Campsite $	Total $
At 30 June 2012
Opening net book value	312,932	50,572	363,504
Additions	26,457	12,604	39,061
Disposals	(50,000)	-	(50,000)
Prof t/(loss) on disposal of asset	14,272	-	14,272
Accumulated depreciation	(14,616)	(10,420)	(25,036)
Depreciation capitalised to exploration
and evaluation assets	(62,870)	-	(62,870)
Net book value	226,175 Plant and Equipment $	52,756 Campsite $	278,931 Total $
At 30 June 2013
Opening net book value	226,175	52,756	278,931
Additions	13,809	12,365	26,174
Disposals	(45)	-	(45)
Prof t/(loss) on disposal of asset	(117)	-	(117)
Accumulated depreciation	(7,697)	(9,956)	(17,653)
Depreciation capitalised to exploration	(43,220)	-	(43,220)
and evaluation assets
Net book value	188,905	55,165	244,070

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

8) EXPLORATION AND EVALUATION ASSETS

) EXPLORATION AND EVALUATION ASSETS
Exploration expenditure EXPLORATION AND EVALUATION ASSETS Balance at the beginning of the year Expenditure incurred Depreciation capitalised Impairment (write of ) Balance at end of the year	2013 $ 2012 $
	24,160,253 20,718,976
	20,718,976 15,572,909 4,350,587 5,236,917 43,220 62,870 (952,530) (153,720)
	24,160,253 20,718,976

Note: The recoverability of the carrying amount of the exploration and evaluation assets is dependent on successful development and commercial exploitation, or alternatively, sale of the respective areas of interest.

9) TRADE AND OTHER PAYABLES

) TRADE AND OTHER PAYABLES
CURRENT Trade payables Accruals and other payables	2013 $ 2012 $
	536,226 56,849 895,089 366,617
	1,431,315 423,466

In relation to Accruals and Other Payments, an amount of $353,423 is held for the Meekatharra North Gold Project (deferred farm-in/farm-out arrangement), which is being drawn down over a period of time as exploration activities are undertaken. Payment was received in accordance with the terms of the arrangement and is being drawn down pursuant to a budget approved by the joint arrangement parties.

10) PROVISIONS

0) PROVISIONS
CURRENT Employee entitlements Other	2013 $ 2012 $
	120,898 94,787 5,541 5,850
	126,439 100,637

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

11) ISSUED CAPITAL

1) ISSUED CAPITAL
SHARES ON ISSUE 252,303,570 fully paid ordinary shares (2012: 188,616,911) Share issue costs written of against issued capital MOVEMENT IN ORDINARY SHARES Balance at 30 June 2011 Options converted at $0.75 each to shares on 13 July 2011 Options converted at $0.75 each to shares on 18 July 2011 Shares issued for working capital at $0.25 on 15 August 2011 Shares issued to company employees on 11 October 2011 Shares issued for working capital at $0.10 on 28 February 2012 Options converted at $0.30 each to shares on 1 May 2012 Options converted at $0.30 each to shares on 8 May 2012 Options converted at $0.35 each to shares on 1 June 2012 Shares issued for working capital at $0.085 each on 6 September 2012 Shares issued for working capital at $0.085 each on 3 December 2012 Conversion of Convertible Note at $0.085 per share on 3 December 2012 Options converted at $0.35 each to shares on 20 December 2012 Shares issued for working capital at $0.10 each on 11 January 2013 Shares issued for working capital at $0.10 each on 7 February2013 Options converted at $0.35 each to shares on 21 June 2013 Balance at 30 June 2013	2013 $ 2012 $
	41,517,929 35,782,061 (2,163,999) (1,906,155)
	39,353,930 33,875,906
	No. $
	151,514,567 29,191,353 2 2 7 5 19,000,000 4,750,000 600,000 90,000 17,500,000 1,750,000 2,000 600 330 99 5 2 8,000,000 680,000 29,492,537 2,506,866 4,694,118 399,000 2 1 16,500,000 1,650,000 5,000,000 500,000 2 1
	252,303,570 41,517,929

OPTIONS

For information relating to share options issued to Key Management Personnel (including issued under the Company’s Employee Option Scheme) during the fi nancial year please refer to Note (24) “Share based Payments”.

The current Mindax Employee Option Scheme (EOS) was approved by shareholders at the 2011 AGM; with an updated EOS to be presented at the Company’s 2013 Annual General Meeting for shareholder approval.

The purpose of the EOS is to provide a means by which employees (excluding non-executive directors of the Company), upon whom the responsibilities for the successful growth of the Company rest, can share in such growth and recognise the ability and eff orts of those who have contributed to the success of the Company.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

11) ISSUED CAPITAL (continued)

The key terms of the current EOS include:

• Options are issued to selected eligible employees for free;

• The allotment of options with any attaching conditions is at the discretion of the Board of Directors;

• Shares allotted on the exercise of the options are to be issued at an exercise price which is the greater of:

• 120% of the market value of the shares on the day the option is issued;

• 25 cents; or

• any greater exercise price determined by the Board and advised to the Employee when Options are off ered to the Employee;

• Options are unlisted and not transferable except with prior written approval of the Board; and

• Options carry no dividend rights or voting rights.

The Company had a total of 8,702,321 options over ordinary shares in the Company as at 30 June 2013, of which 6,200,000 options are on issue to eligible employees (2012: 4,050,000).

MOVEMENT IN OPTIONS Balance at 30 June 2011 Issued on 11 October 2011 Issued on 11 October 2011 Expired without exercise on 31 March 2012 Issued on 1 May 2012 Exercised on 9 May 2012 Expired without exercise on 1 August 2012 Expired without exercise on 12 October 2012 Issued on 9 November 2012 Issued on 10 December 2012 Options converted to shares on 20 December 2012 Lapsed without exercise on 31 May 2013 Lapsed without exercise on 31 May 2013 Options converted to shares on 21 June 2013 Balance at 30 June 2013	No.
	2,350,000 1,750,000 1,750,000 (1,800,000) 2,330 (5) (250,000) (300,000) 4,000,000 2,500,000 (2) (650,000) (650,000) (2)
	8,702,321

CAPITAL MANAGEMENT

The Group’s objective when managing capital is to safeguard their ability to continue as a going concern and to provide returns for shareholders and benefi ts for other stakeholders and to maintain capital structure to reduce the cost of capital.

The net assets of the Group are equivalent to capital. Net capital is obtained through raising capital on the Australian Securities Exchange.

The Board of Directors monitors capital on an ad hoc basis. No formal targets are in place for a return on capital, or for gearing ratios, as the Group has not derived any income from their mineral exploration and currently has no debt facilities in place.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

12) OTHER RESERVES AND ACCUMULATED LOSSES

SHARE BASED PAYMENT RESERVE

The option reserve records items recognised as expenses on valuation of employee share options.

RESERVES Employee equity-settled benef ts Employee equity-settled benef ts reserve Balance at beginning of f nancial year (1 July 2012) Share-based payments Share-based payments reversed on cancellation of employee options Balance at 30 June 2013	2013 $ 2012 $
	795,570 680,151
	680,151 624,151 136,219 56,000 (20,800) -
	795,570 680,151

The employee equity settled benefi ts reserve arises on the grant of share options to parties under the EOS. Amounts are transferred out of the reserve and into issued capital when the options are exercised. Further information about share-based payments to employees is made in Note (24) “Share based Payments”.

ACCUMULATED LOSSES

ACCUMULATED LOSSES
Movement in accumulated losses were as follows: Balance 1 July 2012 Net loss for the year Prior year adjustment Balance at 30 June 2013	2013 $ 2012 $
	(11,672,911) (9,369,973) (1,814,133) (2,299,213) - (3,725)
	(13,487,044) (11,672,911)

13) EARNINGS PER SHARE (EPS)
Earnings used to calculate basic and diluted EPS	2013 $ (1,814,133)	2012 $ (2,299,213)
Weighted average number of ordinary shares outstanding during the year used in calculating basic EPS: No. No.
Weighted average number of ordinary shares outstanding during
the year used in calculating basic EPS	223,287,016	174,603,726
Weighted average number of ordinary shares outstanding during
the year used in calculating dilutive EPS	223,287,016	174,603,726

Diluted earnings per share are the same as basic earnings per share as the Group incurred a loss for the year and therefore is not considered dilutive.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

14) CAPITAL AND LEASING COMMITMENTS

4) CAPITAL AND LEASING COMMITMENTS
(a) Lease Commitments – Non-Cancellable Payable – not later than 12 months – between 12 months and 5 years (b) Lease Commitments – Cancellable Payable – not later than 12 months – between 12 months and 5 years (c) Exploration Expenditure Commitments Payable not later than 12 months – between 12 months and 5 years – greater than 5 years	2013 $ 2012 $
	295,681 309,829 70,329 361,134
	366,010 670,963
	- 222 - -
	- 222
	1,578,300 1,962,100 8,266,700 10,032,400 1,975,300 2,618,100
	11,820,300 14,612,600

The above commitments include exploration commitments of 100% relating to the Yilgarn-Avon Joint Venture (YAJV), despite Mindax’s equity position in the YAJV sitting at circa 81%.

Quasar, the joint partner in the YAJV, opted not to pay its capital expenditure commitments for the year ended 30 June 2013; and it is likely their position will remain unchanged for the 2013-2014 fi nancial year, albeit discussions on the 2014 exploration programme are at an early stage. Accordingly, Quasar’s share of the joint venture will continue to dilute, resulting in an increase in the Group’s interest in the YAJV.

Management is of the opinion that the Group’s interest in the YAJV is likely to increase in the future and has therefore assessed its exploration commitment at 100% of total exploration expenditure commitments.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

15) FINANCIAL RISK MANAGEMENT

The Group’s fi nancial instruments consist mainly of deposits with banks, receivables and payables.

The totals for each category of fi nancial instruments, measured in accordance with AASB 139 as detailed in the accounting policies to these fi nancial statements, are as follows:

Note Financial Assets Cash and cash equivalents (4) Trade and other receivables (5) Total Financial Assets Financial Liabilities Trade and other payables (9) Total Financial Liabilities	2013 $ 2012 $
	3,459,634 2,201,405 234,475 162,842
	3,694,109 2,364,247
	1,431,315 423,466
	1,431,315 423,466

Due to their short term nature, the carrying amounts of these fi nancial instruments approximate their fair values.

FINANCIAL RISK MANAGEMENT POLICIES

Exposure to key fi nancial risks is managed in accordance with the Group’s risk management policy with the objective to ensure that the fi nancial risks inherent in exploration activities are identifi ed and then managed or kept as low as reasonably practicable.

The main fi nancial risks that arise in the normal course of business are market risk (primarily interest rate risk), credit risk and liquidity risk. Diff erent methods are used to measure and manage these risk exposures. Liquidity risk is monitored through the ongoing review of available cash and future commitments for exploration expenditure. Exposure to liquidity risk is limited by anticipating liquidity shortages and ensures capital can be raised in advance of shortages. It is the Board’s policy that no speculative trading in fi nancial instruments be undertaken so as to limit expose to price risk.

Primary responsibility for identifi cation and control of fi nancial risks rests with the Managing Director and Chief Financial Offi cer, under the authority of the Board. The Board is apprised of these risks from time to time and agrees any policies that may be undertaken to manage any of the risks identifi ed.

Details of the signifi cant accounting policies and methods adopted, including criteria for recognition, the basis of measurement and the basis on which income and expenses are recognised, in respect of each fi nancial instrument are disclosed in Note (1) to the fi nancial statements. The carrying values less the impairment allowance for receivables and payables are assumed to approximate fair values due to their short term nature. Cash and cash equivalents are subject to variable interest rates.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

15) FINANCIAL RISK MANAGEMENT (continued)

SPECIFIC FINANCIAL RISK EXPOSURES AND MANAGEMENT

(a) Credit Risk

Exposure to credit risk relating to fi nancial assets arises from the potential non-performance by counter parties of contract obligations that could lead to a fi nancial loss to the Group.

The Group trades only with recognised, creditworthy third parties.

The Group has no customers and consequently no signifi cant exposure to bad debts or other credit risks.

With respect to credit risk arising from fi nancial assets, which comprise cash and cash equivalents and receivables, the exposure to credit risk arises from default of the counter party, with a maximum exposure equal to the carrying amount of these instruments. At reporting date cash and deposits were held with Commonwealth Bank of Australia and Westpac Banking Corporation.

The credit quality of the fi nancial assets that are either past due or impaired can be assessed by reference to external credit ratings (if available) or to historical information about counterparty default rates. All cash balances are deposits with fi nancial institutions with ‘AA’ S&P ratings. The term deposits disclosed in Trade and other receivables (Note 5) are also deposits with fi nancial institutions with ‘AA’ S&P ratings. The remaining trade and other receivables balance is to customers or institutions with no credit ratings.

The credit quality of fi nancial assets that are neither past due nor impaired can be assessed by reference to external credit ratings (if available) or to historical information about counterparty default rates.

(b) Liquidity Risk

Liquidity risk arises from the possibility that the Group might encounter diffi culty in settling its debts or otherwise meeting its obligations related to fi nancial liabilities.

Prudent liquidity risk management implies maintaining suffi cient cash reserves to meet the ongoing operational requirements of the business. It is the Group’s policy to maintain suffi cient funds in cash and cash equivalents. Furthermore, the Group monitors its ongoing exploration cash requirements and raises equity funding as and when appropriate to meet such planned requirements. The Group has no undrawn fi nancing facilities. Trade and other payables, the only fi nancial liability of the Group, are due within 3 months.

The tables below refl ect an undiscounted contractual maturity analysis for fi nancial liabilities. Cash fl ows realised from fi nancial assets refl ect management’s expectation as to the timing of realisation. Actual timing may therefore diff er from that disclosed. The timing of cash fl ows presented in the table to settle fi nancial liabilities refl ects the earliest contractual settlement dates and does not refl ect management’s expectations that banking facilities will be rolled forward.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

15) FINANCIAL RISK MANAGEMENT (continued)

Financial liability and fi nancial asset maturity analysis

==> picture [410 x 57] intentionally omitted <==

----- Start of picture text -----

Within 1 Year 1 To 5 Years Total Contractual
Cash Flow
2013 2012 2013 2012 2013 2012
$ $ $ $ $ $
----- End of picture text -----

Financial liabilities due
for payment
Trade and other
payables	1,431,315	423,466	-	-	1,431,315	423,466
Total contractual
outf ows	1,431,315	423,466	-	-	1,431,315	423,466
Financial assets cash
f ows realisable
Trade and other
receivables	234,475	162,842	-	-	234,475	162,842
Total anticipated
inf ows	234,475	162,842	-	-	234,475	162,842

(c) Market Risk – Interest Rate Risk

The Group’s cash fl ow interest rate risk primarily arises from cash at bank and deposits subject to market bank rates. At reporting date, the Group does not have any borrowings. The Group does not enter into hedges. An increase/(decrease) in interest rates by 1% during the whole of the respective periods would have led to an increase/(decrease) in both equity and losses of less than $10,000. 1% was thought to be appropriate because it represents four 0.25 basis point rate rises/falls, which is appropriate in the present economic climate. The majority of cash held in a Term Deposit earned interest income at a rate of 4.23% per annum during the fi nancial year.

16) OPERATING SEGMENTS

IDENTIFICATION OF REPORTABLE SEGMENTS

The Group has adopted AASB 8 Operating Segments whereby segment information is presented using a ‘management approach’. That is, segment information is provided on the same basis as information used for internal reporting purposes.

This has resulted in the segment being disaggregated into four reportable segments based on the minerals present in the Projects detailed in the Quarterly Activities Report released to the Australian Securities Exchange each quarter, prepared by the Managing Director. Based on the contents of this report, the four reportable segments identifi ed are:

1. Uranium (comprising the Yilgarn-Avon Joint Venture (JV) – Palaeochannel Project and other non JV projects);

2. Gold (comprising the Meekatharra North Project);

3. Copper and Gold (comprising the Yilgarn-Avon Joint venture – Mortlock Project); and

4. Iron Ore (comprising the Mt Forrest and Fred’s Bore Project).

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

16) OPERATING SEGMENTS (continued)

Segment information provided to the directors for the year ended 30 June 2013 is as follows:

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----- Start of picture text -----

CONSOLIDATED URANIUM GOLD COPPER & IRON ORE TOTAL
GOLD
Year ended 30 June 2013 $ $ $ $ $
Total segment revenue - - - - -
Intersegment revenue - - - - -
Revenue from external - - - - -
customers
- -
Reportable segment loss 396,244 556,286 952,530
Year ended 30 June 2012
Total segment revenue - - - - -
Intersegment revenue - - - - -
Revenue from external - - - - -
customers
Reportable segment loss - 12,938 140,782 - 153,720
Total segment assets
30 June 2013 5,405,637 862,454 639,583 17,252,579 24,160,253
30 June 2012 4,463,608 815,927 932,183 14,507,258 20,718,976
----- End of picture text -----

Reportable segment liabilities are reconciled to total liabilities as follows:

	2013 $	2012 $
Segment liabilities	-	-
Intersegment eliminations	-	-
Unallocated
Trade and other payables	1,431,315	423,466
Provisions	126,439	100,637
Total liabilities as per the balance sheet	1,557,754	524,103

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

16) OPERATING SEGMENTS (continued)

Reportable segment assets are reconciled to total assets as follows:

==> picture [433 x 585] intentionally omitted <==

----- Start of picture text -----

2013 2012
$ $
Segment assets 24,160,253 20,718,976
- -
Intersegment eliminations
Unallocated
Cash and cash equivalents 3,459,634 2,201,405
Trade and other receivables 234,475 162,842
Prepayments – current 58,893 42,210
Other current assets - -
-
Prepayments – non-current 60,000
Property, plant and equipment 244,070 278,931
Other non-current assets 2,885 2,885
Total assets as per the balance sheet 28,220,210 23,407,249
2013 2012
TOTAL PROFIT OR LOSS FOR REPORTABLE SEGMENTS
$ $
Intersegment eliminations
Allocated Segment Amounts
Uranium (396,244) -
Gold - (12,938)
Copper & Gold (556,286) (140,782)
Iron Ore - -
Total: Allocated Segment Amounts (952,530) (153,720)
Unallocated amounts
Finance costs (3,708) (2,160)
Interest revenue 125,001 166,974
Other revenue 254,910 30,937
Other revenue – R & D tax concession (including interest) 1,197,512 702,768
Depreciation and amortisation (17,653) (25,033)
Share-based payments (115,419) (146,000)
Other expenses (2,302,246) (2,872,979)
Total: Allocated Segment Amounts (861,603) (2,145,493)
Loss before income tax from continuing operations (1,814,133) (2,299,213)
----- End of picture text -----

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

17) KEY MANAGEMENT PERSONNEL DISCLOSURES

The totals of remuneration paid to key management personnel of the Company during the year are as follows:

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----- Start of picture text -----

2013 2012
$ $
Short-term employee & director benefi ts 1,513,304 1,348,851
-
Post employment benefi ts 253,999
Share based payments 136,219 138,000
Totals 1,649,523 1,740,850
----- End of picture text -----

KEY MANAGEMENT PERSONNEL OPTION HOLDINGS

The number of options over ordinary shares held by each key management person of the Group during the fi nancial year is as follows:

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----- Start of picture text -----

30 June 2013 Balance at Granted as Exercised Other Balance at Vested Vested and
beginning remuneration during the changes end of year during the exercisable
of year during the year during the year
year year
- - - - -
G George 1,000,000 1,000,000
S Ward - 4,000,000 - - 4,000,000 - -
- - - - -
A Tsang 500,000 500,000
B Chow - 500,000 - - 500,000 - -
E Loh - 500,000 - - 500,000 - -
- - - -
C Pougnault 1,000,000 1,000,000 1,000,000
- - - -
J Vinar 1,000,000 1,000,000 1,000,000
S Lane 1,050,000 - - (1,050,000) - - -
- - - - - - -
J Stacpoole
Totals 3,050,000 6,500,000 - (1,050,000) 8,500,000 - 2,000,000
----- End of picture text -----

Note: “Other changes during the year” in the above table refl ects options which expired or lapsed during the fi nancial year, without exercise.

==> picture [437 x 224] intentionally omitted <==

----- Start of picture text -----

30 June 2012 Balance at Granted as Exercised Other Balance at Vested Vested and
beginning remuneration during the changes end of year during the exercisable
of year during the year during the year
year year
- - - - -
G George 1,698,312 (1,698,312)
- - - - -
A Tsang 16,325,055 (16,325,055)
B Chow 320,000 - - (320,000) - - -
E Loh - - - - - - -
- - - -
C Pougnault 1,000,000 1,000,000 1,000,000
- - - -
J Vinar 1,000,000 1,000,000 1,000,000
S Lane 50,000 1,000,000 - - 1,050,000 - 1,050,000
- - - - -
G Bromley 3,297,500 (3,297,500)
K Pettit 115,000 - - (115,000) - - -
- - - - - - -
J Stacpoole
Totals 21,805,867 3,000,000 - (21,755,867) 3,050,000 - 3,050,000
----- End of picture text -----

Note : “Other changes during the year” in the above table refl ects options which expired or lapsed during the fi nancial year, without exercise.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

17) KEY MANAGEMENT PERSONNEL DISCLOSURES (continued)

KEY MANAGEMENT PERSONNEL SHAREHOLDING

The number of ordinary shares in Mindax held by each key management person of the Group during the fi nancial year is as follows:

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----- Start of picture text -----

Balance at Granted as Issued on Other changes Balance at end
beginning of remuneration exercise of during the year of year
year during the year options during
the year
30 June 2013
- - -
G George 4,311,413 4,311,413
S Ward - - - - -
- -
A Tsang 43,070,425 4,694,118 47,764,543
B Chow 196,000 - - - 196,000
E Loh - - - - -
Y Li - - - - -
- - -
C Pougnault 200,000 200,000
- - -
J Vinar 200,000 200,000
S Lane 305,000 - - - 305,000
- - - - -
J Stacpoole
Totals 48,282,838 - - 4,694,118 52,976,956
----- End of picture text -----

Note : “Other changes during the year” for Andrew Tsang refl ects changes in shareholdings as a result of the conversion of a Convertible Note issued to Mr Tsang’s mother, Ms Lai You.

==> picture [433 x 262] intentionally omitted <==

----- Start of picture text -----

Balance at Granted as Issued on Other changes Balance at end
beginning of remuneration exercise of during the year of year
year during the year options during
the year
30 June 2012
- -
G George 2,896,625 1,414,788 4,311,413
- -
A Tsang 32,230,112 10,840,313 43,070,425
B Chow 140,000 - - 56,000 196,000
E Loh - - - - -
- - -
C Pougnault 200,000 200,000
- - -
J Vinar 200,000 200,000
S Lane 100,000 200,000 - 5,000 305,000
- -
G Bromley 5,595,001 200,000 5,795,001
K Pettit 510,206 - - 102,041 612,247
- - - - -
J Stacpoole
Totals 41,471,944 600,000 - 12,618,142 54,690,086
----- End of picture text -----

Note: “Other changes during the year” refl ects changes in shareholdings as a result of a rights issue allocation plus on-market transactions.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

17) KEY MANAGEMENT PERSONNEL DISCLOSURES (continued)

There have been no other transactions involving equity instruments other than those described in the tables above.

OTHER KEY MANAGEMENT PERSONNEL TRANSACTIONS

On the resignation of G Bromley as Managing Director the Board formed a temporary working committee from its members to oversee the operations of the Company until the appointment of S Ward on 30 July 2012. For the period ended 30 June 2013, Messrs Chow and Stacpoole were paid consulting fees of $21,000 and $31,206 respectively for the additional time requirements for their role on the working committee.

The above specifi c consultancy services to the Company were on reasonable arm’s length, commercial terms. For details of other transactions with key management personnel, refer to Note (21) “Related Party Transactions”.

18) AUDITORS’ REMUNERATION

8) AUDITORS’ REMUNERATION
Audit and other assurance services Audit and review of f nancial statements (BDO Audit (WA) Pty Ltd) Other services Mineral Resources Rent Taxation advice (BDO (WA) Pty Ltd)	2013 $ 2012 $
	37,238 35,150
	- 6,064

19) CONTROLLED ENTITIES

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----- Start of picture text -----

Name Country of Percentage owned Percentage owned
incorporation (%) 2013 (%) 2012
----- End of picture text -----

Parent Entity:
Mindax Limited	Australia
Subsidiaries of legal parent entity:
Mindax Energy Pty Ltd	Australia	100	100
Yilgiron Pty Ltd	Australia	100	100
Yilgiron Infrastructure Pty Ltd	Australia	100	100
Note: * Percentage of voting power is in proportion to ownership

Acquisitions/Disposals of controlled entities

Nil.

20) CONTINGENT ASSET & LIABILITIES

A term deposit of $20,000 has been secured by the Company’s bankers to provide a bank guarantee in favour of the Minister for the Department of Mines and Petroleum as an unconditional performance bond on E57/555. This tenement has been surrendered by the Company and the unconditional performance bond is in the process of being released. As such the funds will be available for Company use in due course.

A term deposit of $124,042 has also been secured by the Company’s bankers to provide a bank guarantee in support of the lease agreement for the Company’s business premises.

Since the last annual reporting date, there has been no other material change of any contingent liabilities or contingent assets.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

21) RELATED PARTY TRANSACTIONS

Transactions between related parties are on normal commercial terms and conditions no more favourable than those available to other parties unless otherwise stated.

Conversion of Convertible Note

On 27 September 2012 the Company issued a Convertible Note for $399,000 to Ms Lai You, an existing shareholder of the Company and related party to non-executive director, Mr Andrew Tsang. Following shareholder approval received at the Company’s 2012 AGM, the Company converted the Note into 4,694,118 fully paid ordinary shares at $0.085 per share.

Issue of Options to Directors

On 9 November 2012 the Company issued 4,000,000 unlisted options exercisable at $0.108 per option and expiring on 9 November 2015 to the Managing Director and Chief Executive Offi cer of the Company, Dr Steve Ward. The unlisted options were issued pursuant to Dr Ward’s employment agreement and subsequent shareholder approval received at a general meeting held on 1 November 2012.

On 10 December 2012 the Company issued 2,500,000 unlisted options exercisable at $0.11 per option and expiring on 10 December 2015 to non-executive directors pursuant to shareholder approval received at the Company’s 2012 Annual General Meeting, summarised as follows:

• 1,000,000 options to a party nominated by Mr Gilbert George, being the Gilbert George Superannuation Fund;

• 500,000 options to a party nominated by Mr Benjamin Chow, being Sydney Subdivision Pty Ltd;

• 500,000 options to Mr Andrew Tsang; and

• 500,000 options to Mr Loh Kgai Mun.

Issue of Convertible Note

Subsequent to the end of the fi nancial year, 22 August 2013, the Company issued a Convertible Note for $600,000 to the aforementioned Ms Lai You. The key terms and conditions of the Note are as follows:

• The Note is unsecured.

• The Note will not convert and it will be a condition precedent to its conversion into Shares that shareholder approval to its conversion be obtained as soon as practicable following the issue of the Note and in any event by not later than the Company’s 2013 Annual General Meeting.

• The Note shall convert into ordinary fully paid shares at an issue price of $0.12 per share, immediately following the meeting at which shareholders approve the conversion.

• No interest will be payable on the Note unless shareholder approval to the conversion of the Note is not obtained on or before the Company’s 2013 Annual General Meeting.

• Interest applicable (in the event of non-approval by shareholders) will accrue at the rate of 9% per annum, capitalised monthly from the date of issue of the Note until the date the Note is repaid.

• If not converted the face value of the Note is to be repaid on 31 January 2014.

Consulting Fees

On the resignation of Mr Gregory Bromley as Managing Director in April 2012, the Board formed a temporary working committee from its members to oversee the operations of the Company until the appointment of Dr Steve Ward on 30 July 2012. For the period ended 30 June 2013, Messrs Chow and Stacpoole were paid consulting fees of $21,000 and $31,206 respectively for the additional time requirements for their role on the working committee. The specifi c consultancy services to the Company were on reasonable arm’s length, commercial terms.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

22) CASH FLOW INFORMATION

2) CASH FLOW INFORMATION
Reconciliation of cash f ow from operations with loss after income tax Net loss for the year Non cash f ows in Statement of Comprehensive Income Depreciation and amortisation Exploration written of Share based payments (Shares/Options issued under the Company’s employee equity schemes) (Gain)/loss on sale of f xed assets Changes in assets & liabilities, net of the ef ects of purchase and disposal of subsidiaries (Increase)/decrease in trade and other receivables (Increase)/decrease in prepayments Increase/(decrease) in trade and other payables Increase/(decrease) in provisions	2013 $ 2012 $
	(1,814,133) (2,299,213) 17,653 25,033 952,530 153,720 115,419 146,000 112 (14,518) (71,633) 79,577 (76,683) 91,768 148,215 13,066 27,497 (48,731)
	(701,023) (1,853,299)

23) NON-CASH INVESTING AND FINANCING ACTIVITIES

Other than unlisted options issued to directors and disclosed under Note (21) “Related Party Transactions” and Note (24) “Share based Payments” there have been no non-cash investing and fi nancing activities.

24) SHARE BASED PAYMENTS

The Company operates an Employee Options Scheme (EOS), from which Share based payments are undertaken. A summary of the scheme is set out in Note (11) “Issued Capital”.

The following options from share based payments to Employees under the EOS were outstanding at 30 June 2013

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----- Start of picture text -----

Grant Date Expiry Date Exercise Balance At Granted Exercised Cancelled Balance Vested And
Price Start Of During During During At End Of Exercisable
$ The Year The Year The Year The Year The Year At End
(Number) (Number) (Number) (Number) (Number) Of Year
(Number)
11 Oct 2011 30 Sept 2013 0.45 1,750,000 - - (650,000) 1,100,000 1,100,000
11 Oct 2011 30 Sept 2014 0.60 1,750,000 - - (650,000) 1,100,000 1,100,000
Totals 3,500,000 - - (1,300,000) 2,200,000 2,200,000
- -
Weighted average exercise price $0.53 $0.53 $0.53 $0.53
----- End of picture text -----

The weighted average remaining contractual life of share options outstanding at the end of the period was 0.75 years

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

24) SHARE BASED PAYMENTS (continued)

The following options from share based payments made to directors were outstanding at 30 June 2013*

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----- Start of picture text -----

Grant Date Expiry Exercise Balance At Granted Exercised Cancelled Balance Vested And
Date Price $ Start Of During During During At End Of Exercisable
The Year The Year The Year The Year The Year At End
(Number) (Number) (Number) (Number) (Number) Of Year
(Number)
9 Nov 2012 9 Nov 2015 0.108 - 4,000,000 - - 4,000,000 -
10 Dec 2012 10 Dec 2015 0.11 - 2,500,000 - - 2,500,000 -
Totals - 6,500,000 - - 6,500,000 -
- - - -
Weighted average exercise price $0.109 $0.109
----- End of picture text -----

Note *: refer Note (17) “Key Management Personnel” for details. The weighted average remaining contractual life of share options outstanding at the end of the period was 2.4 years

The following options from share based payments were outstanding at 30 June 2012:

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----- Start of picture text -----

Grant Date Expiry Date Exercise Balance At Granted Exercised Cancelled Balance Vested And
Price Start Of During During During At End Of Exercisable
$ The Year The Year The Year The Year The Year At End
(Number) (Number) (Number) (Number) (Number) Of Year
(Number)
4 Aug 2008 1 Aug 2012 0.53 250,000 - - - 250,000 250,000
12 Oct 2009 12 Oct 2012 0.48 300,000 - - - 300,000 300,000
11 Oct 2011 30 Sept 2013 0.45 - 1,750,000 - - 1,750,000 1,750,000
11 Oct 2011 30 Sept 2013 0.60 - 1,750,000 - - 1,750,000 1,750,000
Totals 550,000 3,500,000 - - 4,050,000 4,050,000
- -
Weighted average exercise price $0.58 $0.53 $0.52 $0.52
----- End of picture text -----

The weighted average remaining contractual life of share options outstanding at the end of the period was 0.97 years

EXPENSES ARISING FROM SHARE-BASED PAYMENT TRANSACTIONS

Total expenses arising from share based payment transactions recognised during the period as part of employee benefi t expense were as follows:

Expenses arising from share-based payment transactions Shares issued under EOS Options issued to Key Management Personnel under EOS Options issued to other employees under EOS Employee options cancelled Options issued to Directors Totals	2013 $ 2012 $
	- 90,000 - 48,000 - 8,000 (20,800) 136,219 -
	115,419 146,000

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

24) SHARE BASED PAYMENTS (continued)

FAIR VALUE OF OPTIONS GRANTED

During the fi nancial year 6,500,000 unlisted options were granted to directors of the Company. The expense arising from the transaction at reporting date is $136,219.00. The fair value is independently determined using a Black Scholes option pricing model that takes into account the exercise price, the option term, the share price at grant date and expected price volatility of the underlying share and the risk-free interest rate for the term of the option.

The model inputs for options granted during the year ended 30 June 2013 included:

==> picture [433 x 46] intentionally omitted <==

----- Start of picture text -----

4,000,000 director 2,500,000 director
options issued options issued
9 November 2012 10 December 2012
----- End of picture text -----

Exercise price	$0.108	$0.14
Grant date	9 November 2012	10 December 2012
Expiry date	9 November 2015	10 December 2015
Share price at grant date	$0.085	$0.09
Expected price volatility of the Company’s shares	100%	100%
Expected dividend yield	0%	0%
Risk-free interest rate	2.50%	2.50%
Fair Value	$0.03460	$0.03460

The model inputs for options granted during the year ended 30 June 2012 included:

==> picture [433 x 45] intentionally omitted <==

----- Start of picture text -----

1,750,000 Employee 1,750,000 Employee
options issued options issued
11 October 2011 11 October 2011
----- End of picture text -----

Exercise price	$0.45	$0.60
Grant date	11 October 2011	11 October 2011
Expiry date	30 September 2013	30 September 2014
Share price at grant date	$0.15	$0.15
Expected price volatility of the Company’s shares	65%	65%
Expected dividend yield	0%	0%
Risk-free interest rate	3.73%	3.76%
Fair Value	$0.014	$0.018

25) EVENTS AFTER THE END OF THE REPORTING PERIOD

On 21 August 2013 the Company issued a Convertible Note for $600,000 to Ms Lai You, an existing shareholder of the Company and related party to non-executive director, Mr Andrew Tsang. Refer to Note (21) “Related Party Transactions” for details.

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

26) PARENT ENTITY

The following information has been extracted from the books and records of the parent entity, Mindax Limited and has been prepared in accordance with Accounting Standards.

The fi nancial information for the parent entity has been prepared on the same basis as the consolidated fi nancial statements except as disclosed below.

==> picture [433 x 30] intentionally omitted <==

----- Start of picture text -----

2013 2012
MINDAX LIMITED
$ $
----- End of picture text -----

MINDAX LIMITED	2013 $ 2012 $
Assets Current assets Non-current assets Total Assets Liabilities Current liabilities Non-current liabilities Total Liabilities Equity Issued capital Accumulated losses Share based payment reserve Total Equity Total loss for the year Total comprehensive income	3,644,733 2,402,909 26,659,604 22,160,907
	30,304,337 24,563,816
	(1,557,754) (550,083) - -
	(1,557,754) (550,083)
	39,353,930 33,875,906 (11,402,917) (10,542,324) 795,570 680,151
	28,746,583 24,013,734
	(860,593) (2,157,752)
	(860,593) (2,157,752)

CONTINGENT LIABILITIES

The parent entity has contingent liabilities as at 30 June 2013 that are disclosed in Note (20) “Contingent Asset & Liabilities”.

CONTRACTUAL COMMITMENTS

The parent entity has commitments as at 30 June 2013 that are disclosed in Note (14) “Capital and Leasing Commitments”.

ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES

The additional information, dated 18 September 2013, is required by ASX Limited Listing Rules and not disclosed elsewhere in this report.

DISTRIBUTION OF SHAREHOLDERS (ASX CODE ‘MDX’):

Spread of holdings	Number
1 - 1,000	58
1,001 - 5,000	64
5,001 - 10,000	84
10,001 - 100,000	221
100,001 – and over	113
TOTAL	540

Number of shareholders holding less than a marketable parcel: 111 (0.58% of issued capital).

SUBSTANTIAL SHAREHOLDERS (ASX CODE ‘MDX’):

Shareholder Name	Number of shares	%
Andrew Tsang*	48,139,543	19.080
LAP Exploration Pte Ltd	32,034,616	12.697
HSBC Custody	24,263,105	9.617
Nominees (Aus) Ltd
Zhensheng Zhuang#	23,295,522	9.233
Chenfei Zhuang#	19,844,956	7.866
Jupiter Mines Limited	13,213,579	5.237
TOTAL	160,791,321	63.730%

Note *: The interest held with respect to 15,534,431, 1,355,979, 80,000 and 375,000 of these shares is held by Lei You (mother of Andrew Tsang); Chunxiang Zeng (wife of Andrew Tsang) and Xiang Rong (Australia) Construction Group Pty Ltd (an entity controlled by Andrew Tsang) and the Zeng Superannuation Fund respectively.

Note[#] : The interest held with respect Messrs Zhuang were declared as an association with a third shareholder, Mr Qi Lin, who holds 5,900,000 (2.34%). Accordingly the associated holding for these three shareholders totals 49,040,478 shares (19.44%).

VOTING RIGHTS:

Ordinary shares: on a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote.

Options issued by Mindax have no voting rights.

QUOTED SECURITIES:

Mindax Limited is listed on the Australian Securities Exchange. Shares (ASX Code: MDX) – all 252,303,570 ordinary fully paid shares on issue are quoted securities.

RESTRICTED SECURITIES:

There are no restricted securities.

ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES

UNLISTED OPTIONS:

The Company has on issue the following unlisted options over unissued shares:

• a) 1,110,000 employee options with an exercise price of $0.45 and an expiry date of 30 September 2013A

• b) 1,110,000 employee options with an exercise price of $0.60 and an expiry date of 30 September 2014A

• c) 2,321 options with an exercise price of $0.35 and an expiry date of 31 May 2015.

• d) 4,000,000 director options with an exercise price of $0.108 and an expiry date of 9 November 2015B

• e) 2,500,000 director options with an exercise price of $0.11 and an expiry date of 10 December 2015B

Note : A - Options were issued pursuant to the Company’s Employee Option Scheme. B - Related Party Options - refer to Note (21) “Related Party Transactions”.

TWENTY LARGEST SHAREHOLDERS (ASX CODE ‘MDX’):

Rank	Name	Units	% of Units
1	LAP Exploration Pte Ltd	32,034,616	12.697
2	Mr Andrew Tsang	30,794,133	12.205
3	HSBC Custody Nominees (Australia) Limited	24,068,366	9.539
4	Mr Zhensheng Zhuang	23,295,522	9.233
5	Mr Chenfei Zhuang	19,844,956	7.866
6	Ms Lai You	15,534,431	6.157
7	Jupiter Mines Limited	13,213,579	5.237
8	Mr Guo Xiong Zeng	6,148,971	2.437
9	Mr Qi Lin	5,900,000	2.338
10	Citicorp Nominees Pty Limited	5,666,643	2.246
11	Ms Lici Zeng	5,097,151	2.020
12	Mr Jian Cai Chen	5,000,000	1.982
13	Sherryland Investments Pty Ltd	4,999,000	1.981
14	Chipingi Pty Ltd	4,840,000	1.918
15	Mr Gilbert Charles George	3,639,413	1.442
16	Mr Yuanwen Zhu	3,139,706	1.244
17	Mr Chengze Yu	2,398,789	0.951
18	Ms Mei Ying Yang	1,764,706	0.699
19	Ms Lixuan Zeng	1,598,600	0.634
20	Mr Chaohui Zhang	1,499,000	0.594
Totals		210,672,321	83.500%

ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES

INTEREST IN MINING TENEMENTS:

Tenement	Project	Locality	Status	Interest %
Number
M29/257	Bulga Downs	Mount Forrest - Bulga Downs	Granted	100
M29/258	Bulga Downs	Mount Forrest - Bulga Downs	Granted	100
M29/314	Bulga Downs	Mount Forrest	Granted	100
M29/348	Bulga Downs	Toucan - Bulga Downs	Granted	100
M29/349	Bulga Downs	Macaw North - Bulga Downs	Granted	100
M29/350	Bulga Downs	Macaw - Bulga Downs	Granted	100
M29/351	Bulga Downs	Bulga Downs	Granted	100
E70/3266	Yilgarn-Avon	Canternatting Pool	Granted	81
	Mortlock
E70/3616	Yilgarn-Avon	Hulongine	Granted	81
	Mortlock
E70/3617	Yilgarn-Avon	Youloning	Granted	81
	Mortlock
E70/3820	Yilgarn-Avon	Grass Valley/Avon	Granted	81
	Mortlock
E77/1336	Yilgarn-Avon	Mukinbudin	Granted	81
	Mukinbudin
E70/2986	Yilgarn-Avon	Mukinbudin	Granted	81
	Mukinbudin
E70/2920	Yilgarn-Avon	Bonnie Rock	Granted	81
	Mukinbudin
E77/1337	Yilgarn-Avon	Mukinbudin	Granted	81
	Mukinbudin
E77/1405	Yilgarn-Avon	Jinadarra	Granted	81
	Mukinbudin
E70/3661	Yilgarn-Avon	Mukinbudin	Granted	81
	Mukinbudin
E77/1709	Yilgarn-Avon	Nierguine	Granted	81
	Mukinbudin
E77/1710	Yilgarn-Avon	Geeranning	Granted	81
	Mukinbudin
E70/3887	Yilgarn-Avon	Mukinbudin	Granted	81
	Mukinbudin
E77/1918	Yilgarn-Avon	Jinadarra	Granted	81
	Mukinbudin
E70/3039	Yilgarn-Avon	Brookton	Granted	81
	Quairading
E77/1709	Yilgarn-Avon	Nierguine	Granted	81
	Mukinbudin
E77/1710	Yilgarn-Avon	Geeranning	Granted	81
	Mukinbudin
E70/3887	Yilgarn-Avon	Mukinbudin	Granted	81
	Mukinbudin
E77/1918	Yilgarn-Avon	Jinadarra	Granted	81
	Mukinbudin
E70/3039	Yilgarn-Avon	Brookton	Granted	81
	Quairading

ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES

Tenement	Project	Locality	Status	Interest %
Number
E70/3040	Yilgarn-Avon	South Kellerberrin	Granted	81
	Quairading
E70/3168	Yilgarn-Avon	Quairading	Granted	81
	Quairading
E70/3165	Yilgarn-Avon	Yenyenning Lakes	Granted	81
	Quairading
E70/3178	Yilgarn-Avon	Belka North	Granted	81
	Kellerberrin
E70/3641	Yilgarn-Avon	Kellerberrin	Granted	81
	Kellerberrin
E51/1034	Meekatharra North	Sherwood	Granted	100
E29/809	Fred’s Bore	Panhandle Bore	Granted	100
L29/85	Mt Forrest to	Menzies Sandstone Road	Application	N/A
	Menzies Corridor
L29/86	Mt Forrest to	Menzies Sandstone Road	Application	N/A
	Menzies Corridor
L29/87	Mt Forrest to	Menzies Sandstone Road	Application	N/A
	Menzies Corridor
L29/88	Mt Forrest to	Menzies Sandstone Road	Application	N/A
	Menzies Corridor
L29/89	Mt Forrest to	Menzies Sandstone Road	Granted	100
	Menzies Corridor
L29/90	Mt Forrest to	Menzies Sandstone Road	Granted	100
	Menzies Corridor
L29/102	Mt Forrest Water	Menzies Sandstone Road	Application	N/A
	Licence	(Perrinvale)
L29/103	Mt Forrest to	Menzies Sandstone Road	Granted	100
	Menzies Corridor
L29/104	Mt Forrest to	Menzies Sandstone Road	Application	N/A
	Menzies Corridor
L29/107	Mt Forrest to	Menzies Sandstone Road	Application	N/A
	Menzies Corridor
L29/108	Mt Forrest to	Menzies Sandstone Road	Application	N/A
	Menzies Corridor
L30/45	Mt Forrest to	Menzies Sandstone Road	Granted	100
	Menzies Corridor
L30/46	Mt Forrest to	Menzies Sandstone Road	Granted	100
	Menzies Corridor
L30/47	Mt Forrest to	Menzies Sandstone Road	Granted	100
	Menzies Corridor
L30/52	Mt Forrest Water	Evanstone Menzies Road (Riverina)	Granted	100
	Licence
L37/208	Mt Forrest to	Menzies Sandstone Road	Application	N/A
	Menzies Corridor
L57/38	Mt Forrest Water	Bulga Downs	Application	N/A
	Licence
L57/39	Mt Forrest Water	Yuinmery	Application	N/A
	Licence

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MINDAX LIMITED ABN 28 106 866 442 LEVEL 2, 25 RICHARDSON STREET, WEST PERTH WA 6005 TELEPHONE: (08) 9485 2600 FACSIMILE: (08) 9485 2500

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