PREDICTIVE DISCOVERY LIMITED ACN 127 171 877

ENTITLEMENT OFFER PROSPECTUS

For a pro-rata non-renounceable entitlement offer of 1 New Share for every 5 Shares held by Eligible Shareholders registered at 7.00pm (AEST) on 18 June 2012 at an issue price of \$0.08 per Share together with 1 free attaching unlisted New Option for every 2 New Shares issued to raise up to approximately \$2,008,886.

The Entitlement Offer is scheduled to close at 5.00pm (AEST) on 13 July 2012.

IMPORTANT INFORMATION

This is an important document and requires your immediate attention.

If you are an Eligible Shareholder, you should read this Prospectus in its entirety before deciding whether to apply for New Shares and New Options.

If you do not understand any part of this Prospectus, or are in any doubt as to how to deal with it or your Entitlement, you should consult your stockbroker, accountant, solicitor or other professional adviser.

You should have regard to all publicly available information concerning the Company.

Important notices

You should read this entire Prospectus carefully before deciding whether to invest in New Shares and New Options. In particular, you should consider the key risks that could affect the performance of the Company or the value of an investment in the Company, some of which are outlined in section 5 of this Prospectus.

However, the information provided in this Prospectus is not financial product advice and has been prepared without taking into account your investment objectives, financial circumstances or particular needs. Before deciding whether to apply for New Shares and New Options, you should consider whether they are a suitable investment for you in light of your own investment objectives and financial circumstances and having regard to the merits or risks involved. If, after reading this Prospectus, you have any questions about the Entitlement Offer, you should contact your stockbroker, accountant, solicitor or other professional adviser.

Regulatory Information

This Prospectus is dated 6 June 2012 and was lodged with ASIC on that date. This Prospectus has been prepared by the Company.

The Company will apply to ASX for quotation of the New Shares within 7 days of the date of this Prospectus.

Neither ASIC nor ASX take any responsibility for the contents of this Prospectus.

This Prospectus expires on the date 13 months after the date of this Prospectus. No securities will be allotted, issued or sold on the basis of this Prospectus after that date.

This is a Prospectus for an offer of 'continuously quoted securities' (as defined in the Corporations Act) of the Company and has been prepared in accordance with section 713 of the Corporations Act. Accordingly, this Prospectus does not contain the same level of disclosure as an initial public offering prospectus.

Disclaimer

Except as required by law, and only then to the extent so required, neither the Company nor any other person warrants the future performance of the Company, or any return on any investment made under this Prospectus. An investment in the New Shares and New Options offered by this Prospectus should be considered speculative.

No person is authorised to give any information or make any representation in connection with the Entitlement Offer described in this Prospectus which is not contained in this Prospectus. Any information or representation not contained in this Prospectus may not be relied on as having been

authorised by the Company in connection with the Entitlement Offer.

Forward-looking statements

This Prospectus includes forward-looking statements that have been based on current expectations about future acts, events and circumstances. These forward-looking statements are, however, subject to known and unknown risks, uncertainties and assumptions that could cause those acts, events and circumstances to differ materially from the expectations described in or implied by the forward-looking statements in this Prospectus.

In particular, this Prospectus details some important factors and risks that could cause the Company's actual results to differ from the forward-looking statements in this Prospectus (some of which are outlined in section 5 of this Prospectus).

The pro-forma financial information provided in this Prospectus is for illustrative purposes only and is not represented as being indicative of the Company's view on its future financial condition and/or performance.

Prospectus availability

Shareholders with registered addresses in Australia and New Zealand can obtain a copy of this Prospectus during the Offer Period on the Company's website at

www.predictivediscovery.com or by calling the Company on (08) 9216 1000 at any time from 8.30am to 5.00pm (AWST) Monday to Friday during the Offer Period. If you access the electronic version of this Prospectus, you should ensure that you download and read the entire Prospectus.

The electronic version of this Prospectus on the Company's website will not include a personalised Entitlement and Acceptance Form. You will only be entitled to accept the Entitlement Offer by completing and returning your personalised Entitlement and Acceptance Form, which accompanies this Prospectus, or by making a payment via BPAY® using the information provided on your personalised Entitlement and Acceptance Form (refer to section 3 of this Prospectus for further information).

The Corporations Act prohibits any person from passing the Entitlement and Acceptance Form on to another person unless it is attached to a hard copy of this Prospectus or a complete and unaltered electronic version of this Prospectus.

The distribution of this Prospectus (including an electronic copy) outside Australia may be restricted by law. If you come into possession of this Prospectus, you should observe any such restrictions and should seek your own advice on those restrictions. Any non-compliance with the restrictions may contravene applicable securities

laws.

This document may not be released or distributed in the United States.

Foreign jurisdictions

This Prospectus has been prepared to comply with the requirements of the laws of Australia. No action has been taken to register the New Shares or otherwise permit an offering of New Shares in any jurisdiction outside of Australia.

New Zealand

The New Shares are not being offered or sold to the public within New Zealand other than to existing Shareholders of the Company with registered addresses in New Zealand to whom the offer of New Shares is being made in reliance on the Securities Act (Overseas Companies) Exemption Notice 2002 (New Zealand).

This Prospectus has not been registered, filed with or approved by any New Zealand regulatory authority under the Securities Act 1978 (New Zealand). This Prospectus is not an investment statement or prospectus under New Zealand law and is not required to, and may not, contain all the information that an investment statement or prospectus under New Zealand law is required to contain.

United States

This Prospectus does not constitute an offer in any place in which, or to any person to whom, it would not be lawful to make such an offer. In particular, this Prospectus does not constitute an offer to sell, or a solicitation of an offer to buy, securities in the United States. Any securities described in this Prospectus have not been, and will not be, registered under the US Securities Act and may not be offered or sold in the United States except in transactions exempt from, or not subject to, registration under the US Securities Act and applicable US state securities laws.

See section 2.8 of this Prospectus for further details in relation to persons in other jurisdictions.

Glossary

Terms and abbreviations used in this Prospectus are explained in the Glossary in section 7 of this Prospectus.

A reference in this Prospectus to time is a reference to the local time in Perth, Western Australia, unless otherwise stated.

All financial amounts in this Prospectus are expressed in Australian dollars, unless otherwise stated.

Enquiries

If you have any questions in relation to the Entitlement Offer, please contact your stockbroker, accountant, solicitor or other professional adviser.

If you have questions in relation to the Existing

Shares upon which your Entitlement has been calculated, or how to complete the Entitlement and Acceptance Form or take up all or part of your Entitlement, please call the Company on (08) 9216 1000 at any time from 8.30am to 5.00pm (AWST) Monday to Friday during the Offer Period.

Privacy

Please read the privacy statement located in section 6.7 of this Prospectus.

It is important you understand that by submitting an Entitlement and Acceptance Form accompanying this Prospectus or by making a payment via BPAY® using the information provided on the Entitlement and Acceptance Form, you consent to the matters outlined in that privacy statement.

	Chairman's Letter	5
	Key Offer Information	6
	Key Dates	6
1	Investment Overview	7
2	Details of Entitlement Offer	13
3	How to Apply	21
4	Overview of the Company	25
5	Key Risks	32
6	Additional Information	44
7	Glossary	57
	Authorisation	61

Chairman's Letter

6 June 2012

Dear Shareholder,

On behalf of Predictive Discovery Limited (Company), I am pleased to invite you to participate in a 1 for 5 pro-rata non-renounceable entitlement offer of New Shares at an offer price of \$0.08 per New Share (Entitlement Offer) to raise up to approximately \$2 million together with 1 free attaching unlisted New Option for every 2 New Shares issued subject to the terms of the Entitlement Offer outlined in this Prospectus.

Canaccord BGF is the lead manager of the Entitlement Offer. The Entitlement Offer is not underwritten.

The offer price represents a 14% discount to the Company's closing price of \$0.093 on 25 May 2012 and a 25% discount to the volume-weighted average price of the Company's shares during the 20 trading days up to and including 25 May 2012 (being the trading day before the Entitlement Offer was announced).

The Company intends to use the proceeds of the Entitlement Offer primarily to fund the Company's exploration of its gold project portfolio in Burkina Faso, capital raising costs, and for general working capital purposes. Further details of the use of the funds raised are set out in section 2.1 of this Prospectus.

The Entitlement Offer is non-renounceable, which means that entitlements to take up New Shares (Entitlements) are non-transferable and will not be tradeable on ASX. Shareholders who do not take up all or any part of their Entitlement will not receive any payment or value in respect of the Entitlement not taken up and their equity interest in the Company will be diluted.

This Prospectus contains important information about the Entitlement Offer. With this Prospectus, you will also find a personalised Entitlement and Acceptance Form that contains details of your Entitlement. Details of how to accept the Entitlement Offer are provided on the form and in section 3 of this Prospectus.

The Entitlement Offer is scheduled to close at 5.00pm (AEST) on 13 July 2012. To participate, you need to ensure that you have completed and returned the Entitlement and Acceptance Form and paid all monies before this time and date or, alternatively, that you have paid all monies via BPAY® by no later than 5:00pm (AEST) on that date.

For further information regarding the Entitlement Offer, please call the Company on (08) 9216 1000 between 8.30am and 5.00pm (AWST) Monday to Friday, or visit our website at www.predictivediscovery.com for more information about our Company.

You should also consult your stockbroker, accountant, solicitor or other professional adviser to evaluate whether or not to participate in the Entitlement Offer.

On behalf of the Board of the Company, I thank you for your support of our Company.

Yours faithfully,

Phillip Harman Chairman

Key Offer Information

Offer Price per New Share under the Entitlement Offer	\$0.08
Eligible Shareholders' Entitlement	1 New Share for every 5 Existing Shares held on the Record Date together with 1 free attaching New Option for every 2 New Shares
Approximate maximum Entitlement Offer Proceeds	\$2 million (before costs)
Approximate number of New Shares to be issued in respect of the maximum Entitlement Offer Proceeds	25.11 million
Approximate number of New Options to be issued in respect of the maximum Entitlement Offer Proceeds	12.56 million
Approximate maximum number of Shares on issue on completion of the Entitlement Offer	150.67 million
Approximate maximum number of Options on issue on completion of the Entitlement Offer	21.06 million

Key Dates

Prospectus lodged with ASX and ASIC	6 June 2012
'Ex' date	12 June 2012
Record Date	7:00pm (AEST), 18 June 2012
Opening Date	21 June 2012
Prospectus and Entitlement and Acceptance Forms dispatched to Eligible Shareholders	21 June 2012
Closing Date for acceptance and payment	5:00pm (AEST), 13 July 2012
Deferred settlement trading commences	16 July 2012
Notification of Under-Subscriptions	17 July 2012
Issue and allotment of New Shares and New Options	19 July 2012
Commencement of trading of New Shares	20 July 2012

Note: All dates (other than the date of the Prospectus and date of lodgement of the Prospectus with ASX and ASIC) are indicative only. The Company reserves the right, subject to the Corporations Act, ASX Listing Rules and other applicable laws, to vary the dates of the Entitlement Offer, including extending the Closing Date or accepting late applications, either generally or in particular cases, without notice.

1 Investment Overview

1.1 Investment highlights

Overview

Strong Board, technically strong management with technology capability	The Company's Managing Director and Exploration Manager have experience over many years in conducting successful exploration programs and have been associated with a number of discoveries. The Managing Director and Chief Geologist are both key people in the development of its regional structural analysis Predictore™ technology. The Board has a balanced mix of experience at senior levels in Australia and overseas and in the junior explorer and capital markets. They have a clear understanding of the risks in exploration and the role technology may play.
Large, strategic ground position in Burkina Faso	The Company has applied its Predictore™ technology to select specific areas and acquire interests and/or apply for ground in gold mineralised greenstone belts. The Company currently holds exploration permits in Burkina Faso, West Africa totalling 1,542km2 with a view to project generation aimed at acquiring further high quality West African tenements.
Rapid progress and excellent drill results since listing in December 2010	The Company has completed extensive aeromagnetic and geological surveys and intense RC, diamond core and power auger drilling in Burkina Faso resulting in high grade drill results on the Bangaba and Bonsiega Projects which the Company believes may have the potential to host a major mining operation.
Advancing towards resource calculation in Burkina Faso	Completion of the Entitlement Offer will help fund the Company's planned aggressive exploration program on its exploration permits in Burkina Faso. The Company's drilling program has two key objectives:
	• to identify the scale of potential gold mineralised systems on the Company's properties; and
	• to infill drill the best prospects with RC drilling in order to advance them towards a JORC Code Resource calculation.
	Numerous encouraging drill results have been reported by the Company in the Company's Quarterly Report for the period ended 31 March 2012, indicating that the Company is making rapid progress towards this goal.
Shareholder support	Acorn Capital (the Company's largest Shareholder) as well as those Directors that are Major Shareholders (in respect of Shares they own or control), have each indicated that it is their present intention to take up their rights under the Entitlement Offer. Should the Major Shareholders ultimately elect to take up their Entitlement, approximately \$500,000 will be raised from these parties.
Summary of Burkina Faso projects
Bangaba Project	The Bangaba project in Eastern Burkina Faso covers areas of extensive artisanal mining. The Company is earning a 95% interest in the 128km² Bangaba exploration permit by making a series of staged payments in cash and Shares.
	Significant quantities of gold have been produced at Bangaba for at least 28 years with cumulative gold production estimated to be several tonnes. Known workings are located on two complex structures on the north-west

	and south-east contacts of a diorite-granodiorite body.
Bonsiega Project	The Bonsiega Project covers approximately 100km of strike length in the Samira Hill greenstone belt in eastern Burkina Faso. This belt hosts the 2.5 million ounce Samira Hill gold mine across the border in Niger and contains numerous active artisanal gold mine sites along its length.
Summary of Australian projects
Modest exploration on Australian projects	The Company conducted a modest gravity survey program on both its Skipton and Woady Creek exploration licences in Victoria, Australia during the March Quarter 2012. Processing of the data was in progress at the date of this Prospectus.

1.2 Key risks

A more detailed explanation of these and other risks is set out in section 5 of this Prospectus.

Exploration stage The Company's mineral tenements are at the exploration stage only. and success The Company is not at a development stage and has no JORC Code compliant Reserves or Resources. Despite the best efforts of the Company, there is no guarantee of exploration success, and, even if there is exploration success, there is no guarantee that development of any such success will be commercially viable.
Operating and project risks	In Burkina Faso, the Company's projects cover areas of outcrop and thin cover which may obscure undiscovered gold ore deposits. There is no certainty that the Company will discover sufficient gold mineralisation at a high enough grade to justify the development of a profitable gold mine. In Australia, the Company has deliberately selected projects in areas where the target rock sequences lie under younger cover. There can be no guarantee that any of the Company's targets will lead to economic intersections when they are drill tested or even intersect the expected geological sequences.	Section 5.2
Technology risks	With the exception of certain case histories, the Predictore™ technology is at a relatively early stage of application and it has no proven track record of generating targets that have led to ore deposits more efficiently than any other approach.	Section 5.2
Personnel risks	The potential application by the Company of the Predictore™ technology is a key distinguishing feature from other exploration entities. Any loss of the Managing Director or Chief Geologist, given their understanding of this technology, would severely impact on the Company's ability to deliver on this strategy. The Company has taken out key-man personal accident insurance to cover the position of the Managing Director and Chief Geologist.	Section 5.2

Additional requirements for capital	As a non revenue generating entity, there will be a requirement to seek additional capital in due course. The Company's ability to do this at an appropriate price will be significantly impacted by commodity prices, market conditions and the capital raising environment at that time.
Geopolitical risk	Given that a large proportion of the Company's tenements are located in Burkina Faso, the Company 's ability to carry on its business in the normal course may be adversely affected by considerations associated with economic, social or political instability in that country. Furthermore, the Company is operating in areas where there are subsistence farmers and artisanal miners and where any discovery could lead to access disputes, potentially delaying any proposed development.	Section 5.2
Tenement title	The Company's title to its tenements generally requires the Company to continue to satisfy its commitments (including in relation to ongoing expenditure). The Company currently has no reason to believe that that it will not satisfy those commitments. However, this cannot be guaranteed.	Section 5.2
Litigation and Like any corporation operating in a commercial setting, the counterparty risks Company is exposed to potential legal and other claims or disputes in the course of its business, including claims by employees, regulators or other third parties. As with any litigation, there is a risk that defending such claims, or the outcome of the claims, may have an adverse impact on the Company. The Company's financial performance is also exposed to and may be adversely impacted by the actions of counterparties to its contracts.
Conditions and The mandate letter under which Canaccord BGF is appointed as termination of the Lead Manager and to assist the Company to place any Shortfall Lead Manager entitles the Lead Manager to terminate its appointment at any time mandate on twenty days prior written notice.		Section 5.2
Liquidity and volatility	The Company is a small company in terms of market capitalisation and also has a relatively small Shareholder base. Therefore there is a risk that there will not be a highly liquid market for Shares, or that the price of Shares may decrease considerably. The New Options are unlisted and are not freely transferrable.	Section 5.2
Risks associated with mining exploration and operations	There are risks inherent in the mining exploration and operating activities undertaken by the Company, which could result in an adverse impact on the Company's ability to conduct those activities and on its financial position and performance. These include: • potential adverse effects from changes in legislative and administrative regimes, taxation laws or other legal and governmental policies, including the potential impact of the carbon price mechanism implemented in Australia; • the Company's ability to conduct its exploration and production activities is dependent on its title to the relevant tenements and authorisations to conduct such activities, which may not be granted or may be withdrawn or made subject to onerous conditions, or affected by native title; • while the Company attempts to conduct its operations and activities to the highest standard of environmental obligation,	Section 5.3

	there is an inherent risk of significant liability arising from non compliance with environmental laws and regulations;
	• although the Company's maiden resource estimate will be prepared in accordance with the JORC Code, they are expressions of judgement and no assurance can be given that any particular level of recovery will be realised; and
	• the Company's insurance may not always be of a nature or level to provide adequate cover, and appropriate insurance may not be available on acceptable terms.
Entitlement Offer	There are certain risks associated with participating or not participating in the Entitlement Offer, including:	Section 5.4
	• your Shareholding in the Company may be diluted as a result of not taking up your full Entitlement; and
	• if the Company is unable to successfully complete the Entitlement Offer, it will have to consider alternative funding options, which may or may not be available on acceptable terms or may result in dilution to Shareholders.
General risks	There are a number of general risks attaching to an investment in New Shares and New Options, including:	Section 5.5
	• risks associated with the effectiveness and results of the application of the Company's capital resources;
	• the market price of Shares may rise or fall as a result of a number of factors affecting the liquidity of Shares and/or the stock market generally; and
	• changes in macroeconomic conditions may result in a change in demand for the Company's products, which may adversely affect the Company's future revenues and Share price.

1.3 The Entitlement Offer

What is the The Entitlement Offer is a pro-rata non-renounceable offer made to Entitlement Offer? Eligible Shareholders to subscribe for New Shares.		Section 2.2
What is my Each Eligible Shareholder is entitled to subscribe for 1 New Share Entitlement? for every 5 Existing Shares held on the Record Date, and 1 free attaching unlisted New Option for every 2 New Shares issued under the Entitlement Offer, subject to the terms of this Prospectus.		Entitlement and Acceptance Form
What is the Offer Price?	The Offer Price is \$0.08 per New Share. There is no consideration payable for the issue of New Options.	Section 2.5
Am I an Eligible Shareholder?	Eligible Shareholders are those persons who: • are registered as a holder of Shares as at 7.00pm (AEST) on the Record Date; • have a registered address in Australia or New Zealand or are, in the opinion of the Company and the Lead Manager, otherwise eligible under all applicable securities laws to receive an offer of New Shares under the Entitlement Offer; and • are not in the United States and are subscribing for the New	Sections 2.7 and 2.8

Shares in an 'offshore transaction' (as defined in Rule 902(h) of the US Securities Act).

How much will be The Entitlement Offer will raise approximately \$2 million (before raised from the costs). Entitlement Offer?		Sections 4.5 and 4.6
What is the The Company intends to use the proceeds of the Entitlement Offer purpose of the primarily to fund the Company's exploration of its gold project Entitlement Offer portfolio in Burkina Faso, capital raising costs, and for general and how will the working capital purposes. funds raised be See section 2.1 for further details. used?		Section 2.1
Is the Entitlement Offer underwritten?	No – however Canaccord BGF has been appointed Lead Manager of the Entitlement Offer.	Section 6.6
What are the tax implications of participating in the Entitlement Offer?	Taxation implications will vary depending upon the specific circumstances of individual Shareholders. Investors should obtain their own professional advice as to the particular taxation treatment which will apply to them.	Section 6.11
Can I apply for Yes – Eligible Shareholders may also apply for New Shares and Additional New New Options in excess of their Entitlement, subject to there being a Shares and New sufficient Shortfall and subject to the Board's discretion. Options above my Entitlement?		Section 2.3
Where can I find more information about the Company?	For more information on the Company, see section 4 of this Prospectus.	Section 4

1.4 Actions for Eligible Shareholders

How do Eligible Your Entitlement is set out on the personalised Entitlement and Shareholders find Acceptance Form accompanying this Prospectus. out what their Entitlement is?		Entitlement and Acceptance Form
What can I do with my Entitlement?	You can do the following: • take up all or part of your Entitlement; or • do nothing, in which case your Entitlement will lapse. You may also choose to apply for Additional New Shares and New Options, as described in section 2.3.	Section 3.1
Can I trade my Entitlement?	No – the Entitlement Offer is non-renounceable, meaning you cannot trade your Entitlement.	Section 2.10

What happens if I If you do not take up all of your Entitlement by the Closing Date, do not take up my then New Shares and New Options representing the number of New Entitlement, or Shares and New Options not taken up under your Entitlement will take up only part form part of the Shortfall. This will likely result in your interest in the of my Entitlement? Company being diluted.
How do I accept the Entitlement Offer? And how do I apply for Additional New Shares and New Options?	If you wish to take up all or part of your Entitlement (and if you wish to apply for Additional New Shares and New Options), you must either: • complete and return the personalised Entitlement and Acceptance Form to the Share Registry together with a cheque, bank draft or money order for the full Application Monies so that it is received by the Share Registry by no later than 5.00pm (AEST) on the Closing Date; or • pay the full Application Monies via BPAY® by no later than 5.00pm (AEST) on the Closing Date.	Section 3.4

1.5 Further information

If you have any questions about the Entitlement Offer that are not answered in this Prospectus you should consult your stockbroker, accountant, solicitor or other professional adviser before deciding to invest or call the Company on (08) 9216 1000 at any time from 8.30am to 5.00pm (AWST) Monday to Friday during the Offer Period.

2 Details of Entitlement Offer

2.1 Purpose of Entitlement Offer and use of funds

The purpose of the Entitlement Offer is to raise up to \$2,008,886 (before costs), to enable the Company to fund the exploration of its gold project portfolio in Burkina Faso, capital raising costs, and for general working capital purposes.

The Entitlement Offer Proceeds are planned to be used in accordance with the table set out below:

Use of funds	\$ (millions)
Exploration of Burkina Faso projects	\$1,500,000
Costs of the Entitlement Offer (including capital raising costs)	\$155,480
Allowances	\$153,406
Working capital	\$200,000
Total	\$2,008,886

Any funds received by the Company on exercise of the New Options will be used to fund the Company's current exploration program at the time of exercise of the New Options and for general working capital purposes.

The above is a statement of the Board's current intention as at the date of this Prospectus. However, Shareholders should note that, as with any budget, the allocation of funds set out in the above table may change depending on a number of factors, including the outcome of operational and development activities, regulatory developments, market and general economic conditions and environmental factors. In light of this, the Board reserves the right to alter the way the funds are applied.

In the event that Eligible Shareholders do not take up all of their Entitlements and any Shortfall is not successfully placed, resulting in less than the maximum amount being raised, the proceeds of the Entitlement Offer will be allocated to the costs of the Entitlement Offer and the exploration of the Burkina Faso projects, with allowances and working capital being reduced on a pro-rata basis. In the event that less than adequate funds are raised to pay the costs of the Entitlement Offer and other proposed uses of funds, the Company is likely to need to use existing cash resources to pay those amounts or make other alternative arrangements.

2.2 Structure of Entitlement Offer

Approximately 25,111,081 New Shares are being offered at an Offer Price of \$0.08 per New Share. Each Eligible Shareholder has the opportunity to subscribe for 1 New Share for every 5 Existing Shares held on the Record Date, together with 1 free attaching New Option for every 2 New Shares issued under the Entitlement Offer.

The free attaching New Options are exercisable at \$0.10 on or before 30 June 2013, \$0.15 on or before 30 June 2014, and \$0.20 on or before their expiry date on 30 June 2015. The full terms of the New Options are set out in section 6.4.

Due to rounding of Entitlements under the Entitlement Offer to Shareholdings on the Record Date, among other things, the exact number of New Shares and New Options to be issued will not be known until completion of the Entitlement Offer.

The Entitlement Offer is intended to raise up to approximately \$2 million (before costs).

Eligible Shareholders are being sent this Prospectus together with a personalised Entitlement and Acceptance Form and are invited to apply for New Shares and New Options. The Entitlement Offer opens on 21 June 2012 and is scheduled to close at 5.00pm (AEST) on 13 July 2012.

2.3 Additional New Shares and New Options

Eligible Shareholders may also apply for New Shares and New Options in excess of their Entitlement (Additional New Shares and New Options).

Any Additional New Shares and New Options will be limited to the extent that there are sufficient New Shares from Eligible Shareholders who do not take up their full Entitlements (ie that form part of the Shortfall) or from New Shares and New Options that would have been offered to Ineligible Shareholders (as defined in section 2.8 below) if they had been entitled to participate in the Entitlement Offer.

Additional New Shares and New Options will only be allocated to Eligible Shareholders, if and to the extent that the Company so determines, in its absolute discretion, having regards to circumstances as at the time of the close of the Entitlement Offer and subject to the Corporations Act and the ASX Listing Rules. The Company may apply any scale-back in its absolute discretion. The Company's decision on the number of Additional New Shares and New Options allocated to Eligible Shareholders will be final.

To the extent that there remains any shortfall in the take-up of the Entitlement Offer following allocations of Additional New Shares and New Options, the Directors reserve the right to issue the shortfall at their discretion, subject to the Company's obligations under the mandate entered into with the Lead Manager (see further section 6.6).

2.4 No minimum subscription

There is no minimum subscription for the Entitlement Offer.

2.5 Offer Price

The Offer Price is \$0.08 per New Share. This is payable on taking up your Entitlement. There is no consideration payable for the issue of New Options.

Additional New Shares and New Options are also offered at \$0.08 per New Share, payable at the time of applying for Additional New Shares and New Options.

The Offer Price represents a 14% discount to the Company's closing price of \$0.093 on 25 May 2012 and a 25% discount to the volume-weighted average price of the Company's shares during the 20 trading days up to and including 25 May 2012 (being the trading day before the Entitlement Offer was announced).

2.6 Shortfall

The Directors reserve the right in accordance with the Corporations Act and ASX Listing Rule 7.2 (exemption 3) to place any Shortfall at their discretion with:

Eligible Shareholders whose acceptance exceeds their Entitlement; or
any other parties selected by them.

Any New Shares and New Options the subject of the Shortfall will be placed no later than 3 months after the Closing Date and will be issued on the same terms as are offered to Eligible Shareholders under the Entitlement Offer.

The Company has appointed the Lead Manager to manage the placement of any Shortfall. The Company has agreed to pay the Lead Manager 4% of the proceeds of the issue of any New Shares and New Options comprised in the Shortfall (if any) that are placed by the Lead Manager (but not including New Shares issued pursuant to applications by Eligible Shareholders for Additional New Shares and New Options in excess of their Entitlements or placed by other brokers). The terms of the mandate entered into with the Lead Manager are summarised in section 6.6.

This arrangement does not constitute an underwriting of the Entitlement Offer or the Shortfall. The Offer is not underwritten and there is no guarantee that any amount of the Shortfall (if any) will be successfully placed to investors.

The offer of any New Shares and New Options comprised in any Shortfall is a separate offer made pursuant to this Prospectus and will remain open for up to 3 months following the Closing Date. The purpose of offering New Shares and New Options comprised in the Shortfall is to comply with section 708A(11) of the Corporations Act so that sophisticated and professional investors issued New Shares and New Options pursuant to the placement of the Shortfall by the Lead Manager can sell their New Shares and New Options within the next twelve months without the issue of a prospectus.

Eligible Shareholders who subscribe for New Shares and New Options in excess of their Entitlement are not guaranteed to be issued any New Shares and New Options in excess of their Entitlement. The number, if any, of New Shares and New Options Eligible Shareholders will be issued in excess of their Entitlement will depend on demand for New Shares and New Options from other Eligible Shareholders and from other persons to whom the Company decides to offer New Shares and New Options, and any scale back that the Company may apply (in its absolute discretion).

You may apply for any New Shares and New Options comprised in any Shortfall by completing the relevant section of your Entitlement and Acceptance Form sent with the Prospectus or, for sophisticated and professional investors, pursuant to a separate application form provided by the Lead Manager. Payment for New Options and New Shares comprised in the Shortfall must be made in the same manner as described in section 3 of the Prospectus.

2.7 Eligible Shareholders

Eligible Shareholders are those persons who:

are registered as a holder of Shares as at 7.00pm (AEST) on the Record Date;
have a registered address in Australia or New Zealand or are, in the opinion of the Company and the Lead Manager, otherwise eligible under all applicable securities laws to receive an offer of New Shares under the Entitlement Offer; and
are not in the United States and are subscribing for the New Shares in an 'offshore transaction' (as defined in Rule 902(h) of the US Securities Act).

See below regarding the treatment of Foreign Shareholders.

2.8 Treatment of Foreign Shareholders

This Prospectus and the accompanying Entitlement and Acceptance Form does not constitute an offer of New Shares and New Options in any jurisdiction in which, or to any person to whom, it would be unlawful to make such an offer.

Return of a duly completed Entitlement and Acceptance Form or BPAY® payment will be taken by the Company to constitute a representation by the Applicant that there has been no breach of applicable securities laws.

The distribution of this Prospectus in jurisdictions outside Australia may be restricted by law and anyone who receives this Prospectus should seek advice on and observe such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities laws. No action has been taken to register or qualify the New Shares or the Entitlement Offer, or otherwise permit a public offering of New Shares, in any jurisdiction outside Australia. New Shares may not be offered or sold in any country outside Australia except to the extent permitted below.

It is the responsibility of any Applicant to ensure compliance with any laws of the country relevant to their application. Return of a duly completed Entitlement and Acceptance Form and/or payment of Application Money will be taken by the Company to constitute a representation that there has been no breach of such laws and that the Applicant is physically present in Australia or New Zealand.

New Zealand

Ineligible Shareholders

Shareholders who are not Eligible Shareholders are Ineligible Shareholders.

The Company has determined, in reliance on Listing Rule 7.7.1, that it would be unreasonable to extend the Entitlement Offer to Ineligible Shareholders, having regard to the:

small number of Ineligible Shareholders;
small number and value of the New Shares and New Options which would be offered to Ineligible Shareholders if they were Eligible Shareholders; and
cost of complying with the legal and regulatory requirements in the respective overseas jurisdictions.

Accordingly, the Entitlement Offer is not being extended to any Shareholders outside Australia and New Zealand, unless, in the opinion of the Company and the Lead Manager, that Shareholder would be eligible under all applicable securities laws to receive an offer of New Shares under the Entitlement Offer.

The Company will notify all Ineligible Shareholders of the Entitlement Offer and advise that the Company is not extending the Entitlement Offer to those Shareholders.

2.9 Nominees, trustees and custodians

The foreign selling restrictions under the Entitlement Offer summarised in section 2.8 apply to the underlying beneficial holder. Nominees, trustees or custodians must not apply on behalf of any beneficial holder that would not itself be an Eligible Shareholder.

Shareholders who hold Shares on behalf of persons whose registered address

is not in Australia or New Zealand are responsible for ensuring that accepting the Entitlement Offer does not breach securities laws in the relevant overseas jurisdictions.

Shareholders who are nominees, trustees or custodians are therefore advised to seek professional advice as to how they should proceed. Failure to comply with restrictions set out in this Prospectus may result in violations of applicable securities laws.

In particular, nominees, trustees and custodians must not:

send any materials relating to the Entitlement Offer into the United States or to any other country outside Australia and New Zealand except to beneficial Shareholders who are institutional or professional investors in other countries listed in, and to the extent permitted under, section 2.8 above; or
submit an Application or otherwise accept the Entitlement Offer on behalf of a person in the United States or any other country outside Australia and New Zealand except beneficial Shareholders who are institutional or professional investors in other countries listed in, and to the extent permitted under, section 2.8 above.

2.10 Trading of Entitlements

Entitlements cannot be traded on ASX or any other exchange, or privately transferred.

2.11 ASX quotation and trading of New Shares

The Company will apply to ASX for the official quotation of the New Shares. The New Options will not be quoted on the ASX.

Subject to approval being granted, it is expected that normal trading of New Shares issued under the Entitlement Offer will commence on 20 July 2012. If ASX does not permit quotation within three months from the date of this Prospectus, the Application Monies will be refunded in full without interest.

Holding statements are expected to be dispatched to Eligible Shareholders on 19 July 2012. It is the responsibility of each Applicant to confirm their holding before trading in New Shares commences. Any Applicant who sells New Shares before receiving confirmation of their holding in the form of their holding statement will do so at their own risk. The Company disclaims all liability, whether in negligence or otherwise (and to the maximum extent permitted by law), to persons who trade New Shares before receiving their holding statements, whether on the basis of confirmation of the allocation provided by the Company or the Share Registry.

2.12 Rounding and determining Entitlements

All Entitlements will be rounded up to the nearest whole number of New Shares and New Options.

The Company reserves the right (in its absolute discretion) to reduce the

number of New Shares and New Options allocated to Eligible Shareholders, or persons claiming to be Eligible Shareholders, if their claims prove to be overstated.

2.13 Ranking of New Shares

New Shares will be issued on a fully paid basis and will rank equally in all respects with Existing Shares.

2.14 Application Monies

All Application Monies will be held by the Company in a bank account on trust for Applicants until the New Shares are issued or, if the New Shares are not issued, until the Application Monies are returned to Applicants.

The bank account will be established and maintained by the Company solely for the purposes of depositing Application Monies and retaining those funds for as long as required under the Corporations Act.

Interest earned on the Application Monies will be for the benefit of, and will remain the property of, the Company and will be retained by the Company whether or not the allotment and issue of New Shares take place.

Amounts received by the Company in excess of your Entitlement (Excess Amount) may be treated as an Application to apply for as many Additional New Shares and New Options as your Excess Amount will pay for in full. Alternatively, your application may not be accepted.

Any Application Monies received for more than your final allocation of New Shares and Additional New Shares and New Options (if any) will be refunded as soon as practicable after the Closing Date (except for where the amount is less than the Offer Price, in which case it will be retained by the Company).

If the New Shares are not issued to you, a cheque will be drawn and relevant Application Monies will be refunded as soon as practicable after the Closing Date.

2.15 Withdrawal of the Entitlement Offer

The Company reserves the right to withdraw the Entitlement Offer at any time, in which case the Company will refund Application Monies in accordance with the Corporations Act and will do so without interest.

2.16 CHESS

The Company participates in the Clearing House Electronic Subregister System (CHESS). ASX Settlement Pty Ltd (ASX Settlement), a wholly-owned subsidiary of ASX, operates CHESS in accordance with the ASX Listing Rules and ASX Settlement Operating Rules.

Under CHESS, Applicants will not receive a certificate but will receive a statement of their holding of New Shares.

If you are broker sponsored, ASX Settlement will send you a CHESS statement. The CHESS statement will set out the number of New Shares issued to you under this Prospectus, and provide details of your holder identification number and the participant identification number of the sponsor. A CHESS allotment advice will be despatched from the Share Registry on 19 July 2012.

If you are registered on the Issuer Sponsored sub-register, your statement will be dispatched by the Share Registry on 19 July 2012 and will contain the number of New Shares issued to you under this Prospectus and your security holder reference number.

A CHESS statement or Issuer Sponsored statement will routinely be sent to Shareholders at the end of any calendar month during which the balance of their Shareholding changes. Shareholders may request a statement at any other time. However, a charge may be incurred for additional statements.

2.17 Optionholders

Holders of Options in respect of Shares will not be entitled to participate in the Entitlement Offer unless:

they have become entitled to exercise their Options under the terms of their issue and do so prior to the Record Date; and
participate in the Entitlement Offer as a result of being a holder of Shares registered on the share register at 7.00pm (AEST) on the Record Date.

3 How to Apply

Eligible Shareholders

You should read this section in its entirety for instructions in relation to the choices available to you as an Eligible Shareholder. You should also refer to section 2 for an overview of the Entitlement Offer.

Foreign Shareholders

Please refer to section 2.8 to determine whether you are an Eligible Shareholder.

3.1 Choices available

Eligible Shareholders may do any of the following:

take up all or part of their Entitlement (refer to section 3.2); or
do nothing (refer to section 3.3).

Eligible Shareholders may also choose to apply for Additional New Shares and New Options as described in section 2.3.

You are not required to take any action in relation to the New Options. The New Options are free attaching Options and therefore 1 New Option will be issued along with each 2 New Shares issued under the Entitlement Offer.

The Entitlement Offer is a pro-rata offer to Eligible Shareholders and is not underwritten. Eligible Shareholders who take up their Entitlement in full will not have their percentage Shareholding in the Company diluted by the Entitlement Offer. The percentage Shareholding of Eligible Shareholders who do not take up all of their Entitlement will be diluted.

For further details on the effect of the Entitlement Offer on the Company, please refer to section 4.6.

3.2 If you wish the take up all or part of your Entitlement

If you wish to take up all or part of your Entitlement, complete the Entitlement and Acceptance Form in respect of the number of New Shares (including any Additional New Shares) you wish to subscribe for and arrange for payment of the Application Monies in accordance with section 3.4.

3.3 Allow all or part of your Entitlement to lapse

If you decide not to accept all or part of your Entitlement to New Shares, or fail to accept by the Closing Date, the part of your Entitlement not accepted will lapse. The New Shares not subscribed for will form part of the Shortfall.

You should note that if you do not take up your Entitlement, then although you will continue to own the same number of Shares, your percentage holding in the Company will be reduced.

3.4 Payment and return of Entitlement and Acceptance Form

You have two payment options in order to take up your Entitlement.

Option 1: Submit your completed Entitlement and Acceptance Form together with a cheque, bank draft or money order.

To follow Option 1, you should:

complete the personalised Entitlement and Acceptance Form accompanying this Prospectus in accordance with the instructions set out on that form, and indicate the number of New Shares (including any Additional New Shares) you wish to subscribe for; and
return the form to the Share Registry (address details below) together with a cheque, bank draft or money order which must be:
in respect of the full Application Monies (being \$0.08 multiplied by the number of New Shares (including any Additional New Shares you wish to subscribe for); and
in Australian currency drawn on an Australian branch of a financial institution; and
made payable to 'Predictive Discovery Limited' and crossed 'Not Negotiable'.

You should ensure that sufficient funds are held in the relevant account(s) to cover the Application Monies. If the amount of your cheque for Application Monies (or the amount for which the cheque clears in time for allocation) is insufficient to pay for the number of New Shares you have applied for in your Entitlement and Acceptance Form in full, you will be taken to have applied for the lower number of whole New Shares as your cleared Application Monies will pay for (and to have specified that number of New Shares on your Entitlement and Acceptance Form). Alternatively, your Application will be rejected.

Cash payments will not be accepted. Receipts for payment will not be issued.

You need to ensure that your completed Entitlement and Acceptance Form and cheque, bank draft or money order reaches the Share Registry at the address below by no later than 5.00pm (AEST) on 13 July 2012.

Your completed Entitlement and Acceptance Form should be returned to the Share Registry at the following address:

	By hand delivery Predictive Discovery Limited
	C/- Link Market Services Limited
	1A Homebush Bay Drive
	RHODES NSW 2138

By post	Predictive Discovery Limited
	C/- Link Market Services Limited
	Reply Paid 3560

SYDNEY NSW 2001

Entitlement and Acceptance Forms (and payment of Application Monies) may not be accepted if received after 5.00pm (AEST) on 13 July 2012 or at the Company's registered or corporate offices.

Option 2: Pay via BPAY® payment

To follow Option 2, you should pay the full Application Monies, being \$0.08 multiplied by the number of New Shares comprising your Entitlement (plus any Additional New Shares), or, if you are subscribing for only part of your Entitlement, the number of New Shares you wish to subscribe for, via BPAY® payment in accordance with the instructions set out on the personalised Entitlement and Acceptance Form (which includes the biller code and your unique customer reference number). You can only make a payment via BPAY® if you are the holder of an account with an Australian financial institution.

Please note that if you choose to pay by BPAY® payment:

you do not need to submit the personalised Entitlement and Acceptance Form but are taken to make the statements on that form; and
if you subscribe for less than your Entitlement or do not pay for your full Entitlement, you are taken to have taken up your Entitlement in respect of such whole number of New Shares which is covered in full by your Application Monies.

You need to ensure that your BPAY® payment is received by the Share Registry by no later than 5.00pm (AEST) on 13 July 2012. Applicants should be aware that their own financial institution may implement earlier cut off times with regards to electronic payment, and should therefore take this into consideration when making payment. It is the responsibility of the Applicant to ensure that funds are submitted through BPAY® by the date and time mentioned above.

Effect of returning Entitlement and Acceptance Form or making BPAY® payment

If an Application is not completed or submitted correctly it may still be treated as a valid Application. The Company's decision whether to treat an Application as valid and how to construe, amend, complete or submit an Application is final.

Returning a completed Entitlement and Acceptance Form or making a BPAY® payment will be taken to constitute a representation by the Applicant that they:

are an Eligible Shareholder;
have received, read and understood a printed or electronic copy of this Prospectus and the accompanying Entitlement and Acceptance Form;
agree to be bound by the terms of this Prospectus and the Constitution;
declare that the law of any other place does not prohibit you from being given this Prospectus or making an application for New Shares or New Options;
declare that all details and statements in the Entitlement and Acceptance Form are complete and accurate;
declare that they are the current registered holder(s) of the Shares in their name at the Record Date;
declare that they are over 18 years of age and have full legal capacity and power to perform all their rights and obligations under the Entitlement and Acceptance Form;
acknowledge that once the Entitlement and Acceptance Form is returned or a BPAY® payment made their acceptance may not be withdrawn, except as allowed by law;
agree to being issued the number of New Shares and New Options they apply for at the Offer Price (or a lower number issued in a way described in this Prospectus) and, subject to section 2.3, to being issued up to the number of Additional New Shares and New Options they apply for at the Offer Price;
authorise the Company to register them as the holder(s) of the New Shares and New Options allotted or granted to them;
acknowledge that the information contained in this Prospectus is not investment advice or a recommendation that New Shares or New Options are suitable for them, given their investment objectives, financial situation or particular needs; and
authorise the Company and its officers or agents to do anything on their behalf necessary for New Shares or New Options to be issued to them, including correcting any errors in their Entitlement and Acceptance Form or other form provided by them and acting on instructions received by the Share Registry using the contact details in the Entitlement and Acceptance Form.

3.5 Enquiries

If you are in doubt as to the course you should follow, you should consult your stockbroker, accountant, solicitor or other professional adviser before deciding to invest. If you:

have questions in relation to the Existing Shares upon which your Entitlement have been calculated;
have questions on how to complete the Entitlement and Acceptance Form or take up your Entitlement; or
have lost your Entitlement and Acceptance Form and would like a replacement form,

please call the Company on (08) 9216 1000 at any time from 8.30am to 5.00pm (AWST) Monday to Friday during the Offer Period.

4 Overview of the Company

The Company was established in late 2007 and is exploring for large high value gold ore deposits in West Africa and Australia. The Company's project focus is on eleven gold exploration permits in Burkina Faso, West Africa. In addition, the Company has a distinctive technological capability, known as Predictore™, which is designed to increase drill targeting efficiency thereby reducing ore discovery cost.

Completion of the Entitlement Offer will help fund the Company's planned and aggressive exploration program on its exploration permits in Burkina Faso, West Africa. The Company's drilling programs have two objectives:

to identify the scale of potential gold mineralised systems on the Company's properties; and
to infill drill the best prospects with RC and diamond drilling in order to advance them towards a JORC Code Resource calculation.

In addition, the Company is evaluating other opportunities in Burkina Faso and more generally in West Africa with a view to expanding its property portfolio into other highly prospective belts. Given ongoing drill results, the Company aims to calculate a maiden JORC Code Resource later this year. Further details regarding the Company, its projects and drill results are disclosed in the Company's Quarterly Report for the period ended 31 March 2012 released to ASX on 1 May 2012, an announcement regarding further drill success on Bonsiega Project released to ASX on 23 May 2012 and an update released to ASX on 30 May 2012. These announcements are available on the Company's website (www.predictivediscovery.com) and ASX's website (www.asx.com.au).

4.1 Overview of Predictore™ technology

The Company's exploration strategy begins with the identification of high priority regions within well mineralised terrains using analyses of country-scale geophysical, geological and mineral deposit data. Ground-based work then involves extensive mapping, followed by geochemistry and drilling. The Company's Predictore™ technology plays a critical role in identifying high priority targets at all scales – from country scale area selection to drill target prioritisation.

Predictore™ is an Australian developed technology that resulted from over seven years of joint government/industry funded research at a cost of approximately \$17 million. A number of case history studies carried out during that research program demonstrated the effectiveness of the approach. The Company has the exclusive right to apply the technology outside of Australia and non-exclusive rights to apply it within Australia. The technology has two components: the first is applied to regional data sets and is able to highlight subtle large and deep structures that potentially controlled large mineralised systems. The second uses advanced computer simulation to map the movement of mineralising fluids through rocks and thereby predict where ore deposits are most likely to have formed. This powerful approach allows the

Company's geologists to test a variety of predictions against what they actually observe in the field and make more rigorous conclusions about the location of priority targets. The Company believes that it has the potential to increase the odds of discovery.

4.2 Summary of exploration projects

Name	Number	Owner	Location	JV/option partner (if any)	Area (km²)
Burkina Faso
Fouli	Arrêté 2011- 11- 351/MCE/SG/DGMGC	Birrimian (BVI) Ltd (earned 72%)	Burkina Faso	ElDore Mining Corporation Ltd.	186
Tantiabongou	Arrêté 2007- 019/MCE/SG/DGMGC	Birrimian (BVI) Ltd (earned 72%)	Burkina Faso	ElDore Mining Corporation Ltd	126
Sirba	Arrêté 2011-11 - 353 /MCE/SG/DGMGC	Birrimian (BVI) Ltd (earned 72%)	Burkina Faso	ElDore Mining Corporation Ltd	137
Madyabari	Arrêté 2011- 11 - 352/MCE/SG/DGMGC	Birrimian (BVI) Ltd (earned 72%)	Burkina Faso	ElDore Mining Corporation Ltd	172
Tyekanyebi	Arrêté 2010- 202/MCE/SG/DGMGC	Predictive Discovery SARL (100%)	Burkina Faso	None	242
Tamfoagou	353 (arrêté 2005- 061/MCE/SG/DGMGC)	Predictive Discovery SARL (100%)	Burkina Faso	None	238
Tangagari	Arrêté 2009- 068/MCE/SG/DGMGC	Sebi, Bourougou (earning 95%)	Burkina Faso	Sebi, Bourougou and SOMIKA	128
Aoura	Arrêté 2008- 023/MCE/SG/DGMGC	Nabaloum, Patrice (earning 95%)	Burkina Faso	Nabaloum, Patrice and SOMIKA	25
Kogodou	2011-11-299MCE	Zongo Richard (earning 95%)	Burkina Faso	Mr Zongo Richard	44
Boussouma	Arrete 2011- 059/MCE/SG/DGMGC	Somika SARL (earning 95%)	Burkina Faso	Somika SARL	116
Bangaba	Arrete 2009- 100/MCE/SG/DGMGC	Somika SARL (earning 95%)	Burkina Faso	Somika SARL	128
Australia
Woady Creek	EL 5314	Predictive Discovery Ltd (100%)	Victoria, Australia	None	2
Skipton	EL 5172	Predictive Discovery Pty Ltd (100%)	Victoria, Australia	None	346
Total					1,890

4.3 Overview of the Company's projects

Burkina Faso Gold Projects

The Company's major country focus is in Burkina Faso, West Africa where it has established a large Burkina-based exploration team and a large tenement package located mainly in the north-east of the country, largely in the Bonsiega and Bangaba Projects (Figure 1), and is exploring for large open-pittable gold ore deposits. Since the beginning of November 2011, when field programs began after the rainy season, the Company has completed approximately 65,000m of drilling.

Figure 1: Locality Plan – Company's projects in Eastern Burkina Faso superimposed on a Government geological map.

Bonsiega Gold Project

The Bonsiega Project covers 1,056km² and over 100 kilometres of strike length of the Samira Hill greenstone belt (see Figure 2). Historic work consisted of geological mapping, airborne geophysical surveys and soil geochemistry but only limited drilling. Despite this, according to databases assembled by the Company's joint venture partner on four of the permits, ElDore Mining Corporation Limited, a series of ore width and grade intercepts were obtained by prior explorers at various locations within their permits.

This belt hosts the 2.5 million ounce Samira Hill gold mine across the border in Niger and contains numerous active artisanal gold mine sites along its length.

Figure 2: Bonsiega Project locality plan superimposed on Government geological map (pink is granite, green is greenstone). The ElDore Joint Venture (72%) permits are outlined in blue, two 95% earn-in option agreements are in red, a 100% option agreement is in magenta and the Company's wholly owned Tamfoagou permit is in brown.

Bangaba Project

The Bangaba Project in Eastern Burkina Faso is located on the Sebba Belt, the next greenstone belt to the north of the Samira Hill Belt, where the Bonsiega Project is located (see Figure 1). The Company is earning a 95% interest in the 128 km² Bangaba exploration permit by making a series of staged payments in cash and shares.

The permit covers extensive areas of artisanal mining, principally at Solna, Tambiri and Mossiga. Significant quantities of gold have been produced at Bangaba for at least 28 years and cumulative gold production is estimated to be two tonnes or more. Artisanal workings extend to up to 50 metres depth in places. Approximately 4,000 people live at the artisanal mining community of Solna, the largest such community in the district.

Permit-wide geological mapping has shown that the known workings are largely located on two large structures on the north-western and south-eastern contacts of a diorite-granodiorite body. These contact zones are largely hidden beneath shallow cover and are each over 10 kilometres long within the permit, suggesting that there is considerable potential to discover additional zones of high grade mineralisation in these areas.

Australian projects

Victorian Gold Exploration

The Company holds two wholly owned exploration licences in Victoria, Skipton and Woady Creek, covering 348 km² .

Work during the March Quarter 2012 on this project consisted of a modest gravity survey. The purpose of this work was to outline a possible concealed volcanic dome under basalt cover which was tentatively interpreted from the 2010 reconnaissance gravity survey. An earlier magneto-telluric survey line identified a resistive feature at depth which might represent a concealed volcanic dome, and which therefore supports the large Stawell-like conceptual gold target that the Company is pursuing.

4.4 Corporate structure and ownership

Structure

The Company is a company limited by shares that is incorporated and domiciled in Australia. It is the ultimate parent entity of the Predictive Group. The companies in the Predictive Group include one wholly owned subsidiary Predictive Discovery SARL, an entity incorporated under the laws of Burkina Faso.

Ownership

Substantial Shareholder	Shareholding
Acorn Capital	12.7%
Lowell Resource Fund	6.0%

4.5 Effect of the Entitlement Offer on the Company

Effect on capital structure

A comparative table of changes in the capital structure of the Company as a consequence of the Entitlement Offer is set out below, assuming that the Entitlement Offer is fully subscribed.

Shares on issue at date of this Prospectus	125,555,405
Issue of New Shares under the Entitlement Offer	25,111,081
Total Shares on issue after completion of the Entitlement Offer	150,666,486
Options
Options exercisable at \$0.25 each on or before 20 August 2015	6,000,000
Options exercisable at \$0.31 each on or before expiring 11 July 2015	500,000
Issue of New Options under the Entitlement Offer (see section 6.4)	12,555,541
Issue of Lead Manager Options to the Lead Manager (see section 6.6)	2,000,000
Total Options on issue after completion of the Entitlement Offer	21,055,541

The above figures assume that no further Shares or Options are issued prior to the issue of New Shares and New Options under the Entitlement Offer. In addition, Shareholders should note that due to rounding of Entitlements under the Entitlement Offer to Shareholdings on the Record Date, among other things, the exact number of New Shares and New Options to be issued will not be known until completion of the Entitlement Offer.

4.6 Financial position

This section provides relevant financial information for Shareholders to consider when assessing whether to participate in the Entitlement Offer, including details of the potential financial impact of the Entitlement Offer. The impact of the Entitlement Offer is expected to be an increase in cash of approximately \$1.85 million (after estimated costs).

The pro forma financial information should be read in conjunction with the limitations explained in the Important Notices section of this Prospectus.

All financial information is presented in accordance with the measurement and recognition principles under AIFRS unless otherwise noted.

Pro forma Statement of Financial Position

Set out on the following page is the audited Statement of Financial Position for the Company at 30 June 2011, audit reviewed Statement of Financial Position at 31 December 2011 and pro forma Statement of Financial Position as at 31 December 2011.

	30 June 2011 (\$)	31 December 2011 (\$)	Proforma (\$)
Current Assets
Cash and cash equivalents	5,208,418	6,268,476	2,653,000
Trade and other receivables	325,339	463,119	463,119
Total Current Assets	5,533,757	6,731,595	3,116,119
Non-current Assets
Property, plant and equipment	287,593	420,682	420,682
Exploration and evaluation expenditure	3,925,307	6,086,531	9,862,447
Total Non-current Assets	4,212,900	6,507,213	10,283,129
Total Assets	9,746,657	13,238,808	13,399,248
Current Liabilities
Trade and other payables	792,662	967,966	250,000
Provisions	81,307	156,599	156,599
Total Current Liabilities	873,969	1,124,565	406,599
Total Liabilities	873,969	1,124,565	406,599
Net Assets	8,872,688	12,114,243	12,992,649
Equity
Issued capital	10,349,630	15,220,690	17,074,096
Reserves	168,717	218,846	218,846
Accumulated losses	-1,645,659	-3,325,293	-4,300,293
Total Equity	8,872,688	12,114,243	12,992,649

Notes of pro forma

The unaudited pro forma consolidated Statement of Financial Position set out above has been prepared on the basis and assumption that there has been and will be no material movements in the assets and liabilities of the consolidated entity between 1 January 2012 and the Closing Date other than:

the issue of 25,111,081 New Shares, 12,555,541 New Options and 2,000,000 Lead Manager Options through the Entitlement Offer raising \$1,853,000 after deducting expenses of the Entitlement Offer \$155,000; and
the payment of estimated exploration and administration costs in the period.

Expense	\$000's
Capital of raising	120,480
Legal fees	20,000
Offer related fees	15,000
Total	155,480

Expenses of Entitlement Offer

4.7 Dividend history

No dividends have been paid by the Company since it was listed on ASX. The Company's dividend policy will be reviewed annually by the Board.

4.8 Directors

The Directors of the Company as at the date of this Prospectus are:

Mr Phillip Harman (Non-Executive Chairman);
Mr Paul Roberts (Managing Director);
Dr Tom Whiting (Non Executive Director);
Dr Robert Danchin (Non Executive Director); and
Mr Philip Henty (Non Executive Director).

Biographies of each Director are set out in the Directors' Report in the Company's 2011 Annual Report, lodged with ASIC and available on the Company's website at www.predictivediscovery.com. The Company will also provide, free of charge, a copy of the 2011 Annual Report to any person who asks for it during the Offer Period – see further section 6.1.

5 Key Risks

5.1 Overview

The Company is a mineral exploration company with a primary focus on gold in West Africa and Australia. Due to the nature of the Company's business activities and mineral exploration interests, increasing your investment in the Company carries with it risks reasonably expected of an investment in a business of this type. Accordingly, whilst the Directors recommend the Entitlement Offer, New Shares and New Options offered pursuant to this Prospectus should be considered speculative. Mineral exploration is a high risk endeavour and prospective investors should read the whole of this Prospectus and consider the risk factors described within it as well as consult their stockbroker, accountant, solicitor or other professional adviser in order to fully appreciate the manner in which the Company operates before deciding whether to apply for their Entitlement, any Additional New Shares and New Options or to otherwise participate in the Shortfall.

The current and future activities of the Company, including exploration, appraisal and production activities, may be affected by a range of factors, including, but not limited to, those discussed in this Prospectus. There is a range of specific risks associated with the Company's involvement in the mineral exploration industry. There are also numerous widespread risks associated with investing in any form of business and with investing in the share market generally. These risk factors are largely beyond the control of the Company and its Directors because of the nature of the Company's business.

By their nature, investments in mining ventures are subject to numerous risks. This section describes certain specific areas that are believed to be material risks associated with an investment in the Company. This section does not, and does not purport to, contain an exhaustive list of the risks associated with an investment in New Shares or New Options.

Before increasing your investment in the Company, you should consider whether this investment is suitable for you having regard to the risk factors set out below, publicly available information, your investment objectives and personal financial circumstances, and following consultation with your professional advisors.

A reference to the Company in this key risks section should be taken to include, where relevant, a reference to the Company's project interests.

5.2 Risk associated with an investment in the Company

The following risks have been identified as being key risks specific to an investment in the Company. These risks have the potential to have a significant adverse impact on the Company and may affect the Company's financial position, prospects and price and value of New Shares and New Options.

Exploration stage and success

The mineral tenements of the Company as described in this Prospectus are at the exploration stage only. The Company is not at the development stage and

has no JORC Code compliant Reserves or Resources. There can be no assurance that exploration of the tenements currently held by the Company, or any other tenements that may be acquired in the future by the Company, will result in the discovery of an economic deposit. Investors should understand that mineral exploration and any subsequent development are high-risk undertakings.

Despite the best efforts of the Company, there is no guarantee of exploration success, and even if there is exploration success, there is no guarantee that development of any such success will be commercially viable. The current and future operations of the Company will be affected by a range of factors. If exploration is successful, there will be additional costs and processes involved in moving to the development phase.

The exploration costs of the Company described in this Prospectus are based on certain estimates and assumptions with respect to the method and timing of exploration. By their nature, these estimates and assumptions are subject to significant uncertainties and, accordingly, the actual costs may materially differ from these estimates and assumptions. Accordingly, no assurance can be given that the cost estimates and the underlying assumptions will be realised in practice, which may materially and adversely affect the Company's viability.

Operating and project risks

The operations of the Company may be affected by various factors, including failure to locate or identify deposits, failure to achieve predicted grades in exploration or mining, operational and technical difficulties in mining, difficulties in commissioning and operating plant and equipment, mechanical failure or plant breakdown, unanticipated metallurgical problems which may affect extraction costs, adverse weather conditions, industrial and environmental accidents, industrial disputes and unexpected shortages or increases in the costs of consumables, spare parts, plant and equipment.

In Australia, the Company has selected projects in areas where the target rock sequences lie under younger cover and is using inferences from geology and remote data sets to predict target locations. There can be no guarantee that any of the Company's targets will lead to economic intersections when they are drill tested or even intersect the expected geological sequences.

In Burkina Faso, the Company's projects cover areas of outcrop and thin cover which may obscure undiscovered gold ore deposits. While there are artisanal mine workings in many of these areas indicating the presence of gold mineralisation, there is no certainty that the Company will discover sufficient gold mineralisation at a high enough grade to justify the development of a profitable gold mine.

Technology risks

As referred to in section 4 of this Prospectus, the Company is utilising the Predictore™ technology which is a computer based targeting system used to map fluids and fluid pathways which are likely to have caused economic minerals in sufficient concentration to form ore deposits. Generally, other computer based targeting systems are based on various automated methods for recognising empirical geological patterns thought to be associated with ore deposits which are inherently unreliable because of the variability of the geological characteristics of ore bodies and their settings. The Company believes that the Predictore™ system will be much more effective because it uses the actual mechanical, physical and chemical properties of rocks and ore forming processes to simulate the actual mechanisms of ore formation.

However, with the exception of certain case histories, the Predictore™ technology is at a relatively early stage of application and it has no proven track record of generating targets that have led to economic intersections and ore deposits any more efficiently than any other approach. The inference of deep crustal structures and their relationship to ore deposits is an empirical observation that may or may not be correct. The application of the fluid flow technology inherently depends on the quality of the model input data which is derived from an analysis of remote data sets such as geophysical data along with sparsely mapped geology. The input model may be incorrect or so inexact that potential locations may not be predicted with sufficient precision to locate reliable or commercial drill targets.

Over time, there is a risk that a research group, either in Australia or overseas, may develop a similar but competing system to Predictore™ which may reduce the competitive advantage that the Company believes it has obtained through its intellectual property rights under the Ausmodel arrangements. This risk may increase if the Company's application of Predictore™ proves to be highly successful in generating new economically viable ore discoveries.

Personnel risks

The potential application by the Company of the Predictore™ technology is a key distinguishing feature from other exploration entities. The Company's Managing Director, Paul Roberts and the Company's Chief Geologist, Dr Barry Murphy each has a deep understanding of the Predictore™ technology including its application in locating exploration targets.

Any loss of the Managing Director or Chief Geologist given their understanding of this would severely impact on the Company's ability to deliver on this strategy. The Company has taken out key-man personal accident insurance to cover the position of the Managing Director and Chief Geologist.

More generally, the Company's success depends to a significant extent upon its key management personnel, as well as other management and technical personnel including sub-contractors. Although the Company enters into employment and incentive arrangements with its personnel to secure their services, it cannot guarantee the retention of their services.

There can be no assurance given that there will be no detrimental impact on the Company if one or more of these people cease their engagement. The Company's inability to recruit additional appropriate skilled and qualified personnel to replace these key personnel could have an adverse effect on the Company. There can be no guarantee that personnel with the appropriate skills will be available within the Company's required timeframes.

Additional requirements for capital

The Company is a small entity that, during its exploration and development stages, will not generate revenue. There is no guarantee that the Company will generate revenue in the future. The Company's future capital requirements will depend on numerous factors. Exploration costs will reduce the Company's cash reserves, which may not be replaced through future operations or other acquisition opportunities, should these prove unsuccessful or perform below expectations. The Company would then be dependent on seeking additional capital elsewhere, through equity, debt or joint venture financing, to support long term exploration and evaluation of its projects.

In addition to amounts raised pursuant to this Entitlement Offer, it is contemplated that the Company will likely require further financing after completing its budgeted use of funds over the financial year ending 30 June 2013. No assurance may be given that the Company will be able to procure funding (if required) in a timely manner on terms acceptable to it and its ability to raise financing will be significantly impacted by commodity prices, market conditions and the capital raising environment at that time. Any additional equity financing will dilute Shareholdings, and debt financing, if available, may involve restrictions on financing and operating activities.

If the Company is unable to obtain additional financing as needed, it may be required to reduce the scope of its operations or scale back its exploration programs, as the case may be. This could have an adverse affect on the Company's activities and could, in extreme circumstances, affect the Company's ability to continue as a going concern.

In addition, in the ordinary course of its operations and development, the Company is required to issue financial assurances, including insurances and bond/bank guarantee instruments, to secure statutory and environmental performance undertakings and commercial arrangements. The Company's ability to provide such assurances is subject to external financial and credit market assessments, and its own financial position.

Geopolitical risk, commodity price volatility and exchange rates risks

Given that a large proportion of the Company's tenements are located in Burkina Faso, the Company's ability to carry on its business in the normal course may be adversely affected by considerations associated with economic, social or political instability or change, hyperinflation, changes to regulatory regimes affecting foreign ownership, government participation, working conditions, taxation, exchange rates and licensing in that country. Any of these events could result in conditions that delay or prevent the Company from exploring or ultimately developing its properties if economic quantities of minerals are found. There is no guarantee that, even if a potentially economic deposit is discovered, the political environment will not change in a way that will significantly impact on the economics of a mining project. Furthermore, the Company is operating in areas where there are subsistence farmers and artisanal miners and where any discovery could lead to access disputes, considerably delaying any proposed development. At this stage, the Company does not maintain political risk insurance.

In the event that the Company achieves exploration success, the revenue it will derive through the sale of commodities exposes the potential income of the Company to commodity price and exchange rate risks. Commodity prices fluctuate and are affected by many factors beyond the control of the Company. Such factors include supply and demand fluctuations for commodities, technological advancements, forward selling activities and other macroeconomic factors. Furthermore, international prices of various commodities and some services are denominated in United States dollars, whereas the income and expenditure of the Company are and will be taken into account in Australian currency. This exposes the Company to the fluctuations and volatility of the rates of exchange between the United States dollar, the Australian dollar and the Euro, and hence the West African Franc, as determined by international markets.

Changes in government policies, taxation and other laws are also a risk factor. The Company understands in this respect that there are no current plans for a new Australian federal government tax on gold mining.

Tenement title

Interests in tenements in Australia are governed by Federal and State legislation and are evidenced by the granting of licences. Each licence is for a specific term and carries with it annual expenditure and reporting commitments, as well as other conditions requiring compliance. Consequently, the Company could lose title to or its interest in tenements if licence conditions are not met or if insufficient funds are available to meet expenditure commitments as and when they arise.

Further, mining and exploration tenements, once granted, are subject to periodic renewal. There is no guarantee that current or future tenement renewals will be approved. Renewal of the term of a granted tenement is at the discretion of the relevant government authority and may include additional or varied expenditure or work commitments or compulsory relinquishment of the areas comprising the Company's projects. The imposition of new conditions or the inability to meet those conditions may adversely affect the operations, financial position and/or performance of the Company.

Interests in tenements in Burkina Faso are governed by the mining law and regulations of that country. There is no guarantee that the Burkina Faso mining law or regulations will not be changed in a way that is adverse to the Company's interests.

The Company's title to its tenements generally requires the Company to continue to satisfy its expenditure or work commitments. The Company currently has no reason to believe that that it will not satisfy those commitments. However, this cannot be guaranteed.

In addition, the Company has entered into farm-in and option arrangements involving both local (Burkina Faso) entities and individuals and a British Virgin Island registered company. In both cases, there is a risk that the Company's ability to successfully defend its rights to equity in Burkina Faso tenement titles in the event of a legal dispute may be compromised by the fact that some of

the counterparties are located in countries where Australian law does not prevail.

Litigation and counterparty risks

Like any corporation operating in a commercial setting, the Company is exposed to potential legal and other claims or disputes in the course of its business, including litigation from employees, regulators or other third parties. As with all litigation, there are risks involved – an adverse outcome in litigation or the cost of responding to potential or actual litigation may have a material adverse impact on the financial performance of the Company.

In addition, there is a risk of financial failure or default by a participant in any joint venture to which the Company is or may become a party, or the insolvency or managerial failure by any of the contractors or other suppliers used by the Company in any of its activities, or that any of those agreements are terminated in accordance with their terms. There is also a risk of legal or other disputes between the Company and co-venturers or contractors or others suppliers. In particular, the successful exploration of the Company's projects in Burkina Faso is heavily dependent on the services to be provided by the Company's drilling services contractor. Any of the above outcomes, particularly in respect of the drilling services contract, could result in an adverse effect on the Company's ability to explore its projects, as well as its operations, financial position and performance.

Conditions and termination of the Lead Manager mandate letter

The mandate letter under which Canaccord BGF is appointed as Lead Manager and to assist the Company to place any Shortfall entitles the Lead Manager to terminate its appointment at any time on twenty days prior written notice.

A summary of the mandate letter is set out in section 6.6.

Any termination of the mandate letter by the Lead Manager or failure by the Lead Manager to perform its obligations under the mandate letter may result in an adverse effect on the Entitlement Offer (including the placement of any Shortfall).

Liquidity and volatility

The Company is a small company in terms of market capitalisation. An investment in New Shares and New Options should be regarded as speculative. The Company also has a relatively small Shareholder base. As a consequence there is a risk, particularly in times of share market turbulence or negative investor sentiment, that there will not be a highly liquid market for Shares or that the price of Shares may decrease considerably. There may be relatively few buyers or sellers of securities on ASX at any given time and the market price may by highly volatile. This may result in Shareholders wishing to sell their Shares at such a time receiving a market price for their Shares that is considerably less than the price paid under the Entitlement Offer.

The past performance of the Company is not necessarily an indication as to future performance of the Company as the trading price of Shares can go up or

down.

The New Options are not quoted on ASX and are not transferable. Accordingly, they are not a liquid investment. Holders of New Options who wish to exercise their New Options will be required to fund the exercise price, which may be higher than the price of Shares at the time of exercise.

As noted earlier, the Major Shareholders have each indicated that it is their present intention to take up their rights under the Entitlement Offer. Should the Major Shareholders ultimately elect to take up their rights, approximately \$500,000 will be raised from these parties. The Major Shareholders may not elect to take up their rights under the Entitlement Offer, in which case this amount will form part of the Shortfall, which may not be subscribed for by any party.

5.3 Risks associated with mining exploration and operations

Potential investors should understand that all mineral exploration, development and mining activities are high-risk undertakings and there can be no assurance that any exploration or development activity in regard to the Company's current properties, or any properties that may be acquired in the future, will result in the discovery or exploitation of an economic Resource.

Mineral exploration, development and mining may be hampered by circumstances beyond the control of the Company and are speculative operations which by their nature are subject to a number of inherent risks, including those summarised in the section below.

Exploration risks

Exploration is a high risk activity that requires large amounts of expenditure over extended periods of time. The Company's exploration activities are subject to all the hazards and risks normally encountered in the exploration of minerals, including climatic conditions, hazards of operating vehicles and plant, risks associated with operating in remote areas and other similar considerations. Conclusions drawn during mineral exploration are subject to the uncertainties associated with all sampling techniques and to the risk of incorrect interpretation of geological, geochemical, geophysical, drilling and other data.

Further, the costs of the Company's exploration activities may materially differ from its estimates and assumptions. No assurance can be given that the Company's cost estimates and the underlying assumptions will be realised in practice, which may materially and adversely affect the value of the Company's Shares.

Regulatory risks

Changes in legislative and administrative regimes, taxation laws, interest rates, other legal and government policies in Australia or Burkina Faso may have an adverse effect on the assets, operations and ultimately the financial performance of the Company and the market price of Shares.

Exploration and prospective production are dependent upon the granting and

maintenance of appropriate licences, permits and regulatory consents and authorisations (Authorisations), which may not be granted or may be withdrawn or by made subject to limitations at the discretion of government or regulatory authorities. Although the Authorisations may be renewed following expiry or grant (as the case may be), there can be no assurance that such Authorisations will be continued, renewed or granted, or as to the terms of renewals or grants. If the Company cannot obtain or retain the appropriate Authorisations or there is a material delay in obtaining or renewing them or they are granted subject to onerous conditions, then the Company's ability to conduct its exploration or development operations may be adversely affected.

The Australian Parliament passed legislation in November 2011 to implement a carbon price mechanism in Australia from 1 July 2012. A carbon price will increase the cost of activities that directly or indirectly (ie through their inputs) emit greenhouse gas emissions. For mining activities in Australia, such as those to be undertaken by the Company, the key carbon costs will attach to gas, diesel and electricity use. The Company expects to pay, directly or indirectly, for its carbon footprint in Australia. Among other things the Company pays for fuel and electricity use and some power generation it undertakes and the Company's suppliers will most likely look to pass their carbon costs through to the Company. The introduction of the carbon price mechanism has created a level of uncertainty in price outcomes, such as operating costs to buy permits (if required), operating fuel costs, capital expenditure to introduce greenhouse gas abatement measures and increased supply costs. However, the extent of the potential impact of a carbon price on the Company's operations and financial performance remains uncertain and will depend on a range of factors. The Company is preparing to adapt to the new legislation, including assessing whether it can access any Government assistance or reduce its carbon footprint. The Company notes that its Australian assets are not the current principal focus of the Company's expenditure and exploration program.

Native title risks

Native title may impact on the Company's Australian operations and future plans. For tenements that may still be subject to native title to be validly granted (or renewed), the 'right to negotiate' regime established by the Native Title Act 1993 (Cth) must be followed. Alternatively, an indigenous land use agreement may be entered into between the Company and relevant native title parties.

The Company must also comply with Aboriginal heritage legislation requirements which require heritage survey work to be undertaken ahead of the commencement of mining and exploration operations.

Environmental risks

The Company's operations and activities are subject to the environmental laws and regulations of Burkina Faso, Australia and any other places the Company may conduct business. As with most exploration projects, the Company's operations and activities are expected to have an impact on the environment, particularly if advanced exploration or mine development proceeds. The Company attempts to conduct its operations and activities to the highest

standard of environmental obligation, including compliance with all environmental laws and regulations. However, non-compliance with or breach of any conditions attached to the Company's mining or environmental licences may lead to penalties and/or revocation of the licence, and significant liability could be imposed on the Company for damages, clean-up costs or penalties in the event of certain environmental damage. This would require the Company to incur significant costs and may result in an adverse impact on the Company's cash flows, financial position and performance.

Further, the Company is unable to predict the effect of additional environmental laws and regulations which may be adopted in the future, including whether any such laws or regulations would materially increase the Company's cost of doing business or affect its operations in any area. There can be no assurances that new environmental laws, regulations or stricter enforcement policies, once implemented, will not oblige the Company to incur significant expenses and undertake significant investments which could have a material adverse effect on the Company's operations, financial position and performance.

Resource estimate risks

The Company is working towards defining a maiden JORC Code compliant Resource at its Burkina Faso projects. Resources for the Company's assets are estimates only and no assurance can be given that any particular recovery level of metals will in fact be realised. The Company will prepare any estimates in accordance with the JORC Code, but they are expressions of judgement based on knowledge, experience and industry practice, and may require revision. Estimates that are valid when made may change significantly when new information becomes available.

Insurance risks

The Company will endeavour to maintain insurance within ranges of coverage in accordance with industry practice. However, in certain circumstances, the Company's insurance may not be of a nature or level to provide adequate cover. The occurrence of an event that is not covered or fully covered by insurance could have an adverse effect on the Company's operations and financial position and performance.

Insurance of risks associated with minerals exploration is not always available and, where available, the costs can be prohibitive. There is a risk that insurance premiums may increase to a level where the Company considers it is unreasonable or not in its interests to maintain insurance cover or not to a level of coverage that is in accordance with industry practice. The Company will use reasonable endeavours to insure against the risks it considers appropriate for the Company's needs and circumstances. However, no assurance can be given that the Company will be able to obtain such insurance coverage in the future at reasonable rates or that any coverage it arranges will be adequate and available to cover claims.

5.4 Risks associated with the Entitlement Offer

Dilution

The Entitlement Offer will result in the issue of up to approximately 25,111,081 New Shares and 12,555,541 New Options. If you do not participate in the Entitlement Offer or you do not take up your full Entitlement, your percentage holding in the Company (held at the Record Date) will be reduced.

Potential effect on control

The potential effect of the Entitlement Offer on the control of the Company is as follows:

the Entitlement Offer is not expected to have any material effect or consequence on the control of the Company;
if some Eligible Shareholders do not take up all of their Entitlement, then the proportional interest of those Eligible Shareholders in the Company will be diluted (both on the issue of New Shares and upon the issue of Shares upon any exercise of the New Options);
if some Eligible Shareholders do not take up all of their Entitlement and other Eligible Shareholders take up Additional New Shares and New Options or participate in the Shortfall, then the proportional interest of those Eligible Shareholders who take up Additional New Shares and New Options or participate in the Shortfall in the Company will be increased (both on the issue of New Shares and upon the issue of Shares upon any exercise of the New Options); and
the proportional interest of Ineligible Shareholders in the Company will be diluted because Ineligible Shareholders are not entitled to participate in the Entitlement Offer.

As noted above, Acorn Capital holds 12.7% of the Company's issued Shares and has indicated that it is their present intention to take up their rights under the Entitlement Offer. Should Acorn Capital ultimately elect to take up their Entitlement, in circumstances where:

no other Shareholder takes up any of their respective Entitlements and no New Shares or New Options are placed under any Shortfall, then it would increase its holding to approximately 14.9% of all issued Shares;
50% of all Entitlements are taken up (including Acorn Capital taking up all of its Entitlement) and no New Shares or New Options are placed under any Shortfall, then Acorn Capital would increase its holding to approximately 13.9% of all issued Shares; or
75% of all Entitlements are taken up (including Acorn Capital taking up its Entitlements) and no New Shares or New Options are placed under any Shortfall, then Acorn Capital would increase its holding to approximately 13.2% of all issued Shares.

Completion of Entitlement Offer

As noted in this Prospectus, the Directors may not place some or all of any Shortfall under this Entitlement Offer. Accordingly, the Company may not raise all of the funds proposed to be raised under the Entitlement Offer. If the Company is unable to raise approximately \$2m, it will have to reconsider its funding options for its exploration program in Burkina Faso. Alternative means of raising equity may result in dilution to existing Shareholders.

5.5 General risks

The business activities of the Company are subject to various general economic and investment risks that may impact on the future performance of the Company. Some of these risks can be mitigated by the use of safeguards and appropriate systems and controls, but some are outside the control of the Company and cannot be mitigated. There are a number of general economic and investment risk factors that apply to companies generally and may include economic, financial, market or regulatory conditions. These risk factors include, but are not limited to those summarised in the section below.

Discretion in use of capital

The Board and the Company's management have discretion concerning the use of the Company's capital resources as well as the timing of expenditures. Capital resources may be used in ways not previously anticipated or disclosed. The results and the effectiveness of the application of capital resources are uncertain. If they are not applied effectively, the Company's financial and/or operational performance may suffer.

Investment in capital markets

As with all stock market investments, there are risks associated with an investment in the Company.

Securities listed on the stock market, and in particular securities of mining and exploration companies, have experienced extreme price and volume fluctuations that have often been unrelated to the operating performances of such companies. These factors may materially affect the market price of Shares regardless of the Company's performance. The price of Shares might trade below or above the Offer Price for the New Shares.

General factors that may affect the market price of Shares include economic conditions in both Australia and internationally, investor sentiment and local and international share market conditions, changes in interest rates and the rate of inflation, variations in commodity process, the global security situation and the possibility of terrorist disturbances, changes to government regulation, policy or legislation, changes which may occur to the taxation of companies as a result of changes in Australian and foreign taxation laws, changes to the system of dividend imputation in Australia, and changes in exchange rates.

General economic conditions

The operating and financial performance of the Company is influenced by a variety of general economic and business conditions, including levels of

consumer spending, oil prices, inflation, interest rates and exchange rates, supply and demand, industrial disruption, access to debt and capital markets and government fiscal, monetary and regulatory policies. Changes in general economic conditions may result from many factors including government policy, international economic conditions, significant acts of terrorism, hostilities or war or natural disasters. A prolonged deterioration in general economic conditions, including an increase in interest rates or a decrease in consumer and business demand, could be expected to have an adverse impact on the Company's operating and financial performance and financial position.

The Company's future possible revenues and Share prices may be affected by these factors, which are beyond the control of the Company.

6 Additional Information

6.1 Continuous disclosure

The Company is a 'disclosing entity' under the Corporations Act and is subject to regular reporting and disclosure obligations under the Corporations Act and the ASX Listing Rules. Broadly, these obligations require:

the preparation of yearly and half-yearly financial statements and a report on the Company's operations during the relevant accounting period together with an audit or review report on those operations by the Company's auditor; and
the Company to notify ASX immediately of any information (subject to certain exceptions) of which it is or becomes aware which a reasonable person would expect to have a material effect on the price value of its securities. That information is available to the public from ASX.

Copies of documents lodged with ASIC in relation to the Company may be obtained from, or inspected at, an ASIC office.

The Company will provide, free of charge, a copy of each of the following continuous disclosure documents to any person who asks for it during the Offer Period:

the Company's annual report for the period ending 30 June 2011 (being the Company's most recent annual report lodged with ASIC before the date of this Prospectus);
the Company's half-year results for the period ending 31 December 2011; and
any of the other continuous disclosure documents released to ASX by the Company after lodgement of the Company's annual report for the period ending 30 June 2011 and before the lodgement of this Prospectus with ASIC:

Document	Date
Notice of Annual General Meeting/Proxy Form	24 October 2011
Quarterly Cashflow Report	31 October 2011
Quarterly Activities Report	31 October 2011
Boardroom Radio Audio Presentation	7 November 2011
Bonseiga Gold Project Strike Extended by 10km	16 November 2011

Document	Date
Results of Meeting	29 November 2011
Annual General Meeting 2011 Presentation	29 November 2011
Drilling Extends High Grade Solna Gold Prospect`s Strike	21 December 2011
Quarterly Cashflow Report	31 January 2012
Quarterly Activities Report	31 January 2012
PDI Equity in Eldore Joint Venture increases to 72%	1 February 2012
EDM: Burkina Faso Drilling Update	13 February 2012
Laterite Hill Gold Anomalies Extended to More Than 18km	13 February 2012
EDM: Burkina Faso Drilling Update	28 February 2012
Infill drilling at Dave East shows gold mineralisation	28 February 2012
Appendix 3B	1 March 2012
S 708A Notice	6 March 2012
Half Year Accounts	15 March 2012
High Grade Gold Intercepts at Bangaba	20 March 2012
Predictive Discovery Limited audio broadcast presentation	23 March 2012
Corporate Presentation	27 March 2012
EDM: Burkina Faso Update	23 April 2012
10m at 18g/t Au from Dave Prospect	23 April 2012
Predictive Discovery Limited audio broadcast presentation	24 April 2012
Quarterly Cashflow Report	30 April 2012

Document	Date
Quarterly Activities Report	1 May 2012
PDI Acquires Gold Project in Cote D`Ivoire	14 May 2012
EDM: Further Burkina Faso Drill Success	23 May 2012
Further Drill Success on Bonsiega Project	23 May 2012
Predictive Discovery Limited audio broadcast presentation	25 May 2012
Non Renounceable Rights Issue	28 May 2012
Appendix 3B	28 May 2012
Corporate Presentation – May 2012	30 May 2012

All requests for copies of the above documents should be addressed to:

Company Secretary Predictive Discovery Limited Level 2, 9 Colin St West Perth WA 6005 Telephone: +61 8 9216 1000

The above documents may also be obtained from the Company's website (www.predictivediscovery.com) and ASX's website (www.asx.com.au). The Company's ASX code is 'PDI'.

6.2 Market price of Shares on ASX

The highest and lowest sale price of Shares on ASX during the 3 months immediately preceding the date of this Prospectus, and the last sale price on the Trading Day before this Prospectus was lodged with ASIC, are set out below.

3-month high (on 20 March 2012)	3-month low (on 1 June 2012)	Last sale price before date of lodgement of Prospectus (on 5 June 2012)
\$0.215	\$0.083	\$0.093

6.3 Rights and liabilities attaching to New Shares

New Shares will be fully paid ordinary shares in the Company and will rank equally with the Shares already on issue.

The following is a broad summary (though not necessarily an exhaustive or definitive statement) of the rights and liabilities attaching to Shares. Full details of the rights and liabilities attaching to the Shares are contained in the Constitution and, in certain circumstances, are regulated by the Corporations Act, the ASX Listing Rules, the ASX Settlement Operating Rules and the common law. The Constitution is available for inspection free of charge at the Company's registered office during normal business hours.

Issue of Shares

The power to issue Shares and other securities in the capital of the Company lies with the Board subject to the restrictions contained otherwise in the Constitution, the Listing Rules and the Corporations Act.

Voting

Every Shareholder present in person or by proxy at a meeting of Shareholders has one vote on a vote taken by a show of hands, and on a poll, every Shareholder who is present in person or by proxy has one vote for every fully paid Share held. A poll may be demanded at a meeting in the manner permitted by the Corporations Act.

Dividends

Dividends are payable upon the determination of the Directors, who may fix the amount, time for payment and method of payment of dividends.

Transfer of Shares

Subject to the Corporations Act, Listing Rules and ASX Settlement Operating Rules, a Shareholder may transfer Shares by an instrument in writing in a form approved by the Directors. Except as otherwise provided for in the Listing Rules or the ASX Settlement Operating Rules, the Directors may in certain circumstances refuse to register any transfer of Shares, or request ASX Settlement or the Share Registry to apply a holding lock to prevent a proper transfer of Shares.

Meetings and notice

Each Shareholder is entitled to receive notice of, and to attend, general meetings of the Company and to receive all notices, accounts and other documents required to be sent to Shareholders under the Constitution, the Corporations Act and the Listing Rules. A Director may call a meeting of Shareholders and Shareholders may also requisition or convene general meetings in accordance with the procedures for Shareholder-initiated meetings set out in the Corporations Act. Shareholders must be given at least 28 days written notice of any general meeting unless otherwise permitted by the Corporations Act.

Rights on winding up

All Shares rank equally in the event of a winding up, subject to any amount remaining unpaid on any Shares. Once all the liabilities of the Company are met, the liquidator may, with the sanction of a special resolution of the members, divide amongst the members all or any of the Company's assets and for that purpose determine how the liquidator will carry out the division between the different classes of members.

Variation of rights

If the Share capital is divided into different classes of Shares, the rights attached to any class may be varied or cancelled by a special resolution passed at a general meeting of the Shareholders in that class or with the written consent of three quarters of the Shareholders in that class.

Unmarketable parcels

If a Shareholder holds a number of Shares that is less than a marketable parcel (as defined in the Listing Rules), the Company has the power to sell or dispose of such Shares unless otherwise instructed by the Shareholder. The net proceeds from the sale will be paid to the Shareholder.

6.4 Rights and liabilities attaching to New Options

The terms and conditions of the New Options are as follows:

Each New Option entitles the holder to subscribe for one Share upon exercise of the Option and payment of the Exercise Price (defined below).
Each New Option is exercisable at:
10 cents during the period from the date of grant to 30 June 2013 (each inclusive);
15 cents during the period from 1 July 2013 to 30 June 2014 (each inclusive); and
20 cents during the period from 1 July 2014 to the Expiry Date (each inclusive)

(Exercise Price), payable in full on exercise of the New Option.

The New Options automatically expire at 5.00 pm AWST on 30 June 2015 (Expiry Date).
The New Options will not be quoted on ASX.
The Company must give the holder of each New Option a certificate or holding statement stating:
the number of New Options issued to each holder;
the Exercise Price of the New Options; and
the date of issue of the New Options.
Holders may exercise the New Options at any time up to the Expiry

Date. Any New Option not exercised, automatically expires on the Expiry Date.

New Options may only be exercised during the hours of 8.30am to 5.00pm AWST (Business Hours) by the delivery to the registered office of the Company or the Share Registry of a notice in writing stating the intention of the holder to:
exercise all or a specified number of the New Options; and
pay the Exercise Price in full for the exercise of each such New Option.
A notice in writing received outside of Business Hours will be deemed received at the next opening of Business Hours.
The exercise notice must be accompanied by the certificate or holding statement for the options being exercised and a cheque made payable to the Company for the Exercise Price for the New Options being exercised.
The New Options will be deemed to have been exercised on the date the exercise notice is received or deemed to be received by the Company or the Share Registry.
The Company will allot the Shares to which a holder is entitled following exercise of New Options and deliver a holding statement with respect to such Shares within the timeframe required by the Listing Rules.
The exercise of only some New Options will not affect the rights of the holder to the balance of the New Options held by them.
If the holder of the New Options exercises less than the total number of New Options registered in the holder's name:
the holder of the New Options must surrender its option certificate, if one has been issued by the Company; and
the Company must cancel the certificate and issue the holder of the New Options a new certificate or holding statement stating the remaining number of New Options held by the holder and stating the information set out above.
New Options will not confer an entitlement to receive dividends declared and paid by the Company, nor an entitlement to vote at general meetings of the Company unless the holder of the New Options has exercised the New Options before the record date for determining these entitlements and participates as a result of holding Shares.
All Shares issued on exercise of an New Option will:
rank equally in all respects (including, without limitation, rights relating to dividends) with other issued Shares;
be issued credited as fully paid;
be duly authorised and issued by all necessary corporate action; and
be allotted and issued free from all liens, charges and encumbrances whether known about or not, including statutory and other pre-emption rights and any transfer restrictions.
The Company will apply to ASX Limited for official quotation of the Shares issued upon exercise of New Options within the time period required by the Listing Rules.
The New Options are not transferable.
A holder of New Options does not have the right to participate in bonus issues or new issues of securities offered to Shareholders until Shares are allotted to the holder pursuant to the exercise of the New Options.
In the event of a reorganisation (including, without limitation, consolidation, sub-division, reduction or return) of the capital of the Company, the rights of the holders of New Options (including, without limitation, the number of New Options to which the Optionholder is entitled to and the Exercise Price) will be changed (as appropriate) in accordance with the Listing Rules applying to a reorganisation of capital at the time of the reorganisation.
If the Company makes a pro-rata issue (other than a bonus issue) to existing Shareholders and no Share has been issued in respect of the New Option before the record date for determining entitlements to the issue, the Exercise Price of each New Option will be reduced in the manner permitted by the Listing Rules applying at the time of the prorata issue.
If the Company makes a bonus issue to existing Shareholders and no Share has been issued in respect of that Option before the record date for determining entitlements to the issue, then the number of Shares over which that New Option is exercisable will be increased in the manner permitted by the Listing Rules applying at the time of the bonus issue.
The Company is entitled to treat the registered holder of a New Option as the absolute holder of that New Option and is not bound to recognise any equitable or other claim to, or interest in, that New Option on the part of any person other than the registered holder, except as ordered by a court of competent jurisdiction or as required by statute.

6.5 ASX waivers and ASIC relief

The Company has confirmed that no waivers from the ASX Listing Rules are required in relation to the Entitlement Offer. The Company is not relying on any specific ASIC relief in order to conduct the Entitlement Offer.

6.6 Appointment of Lead Manager

The Company has entered into a mandate letter with the Lead Manager who has agreed to manage the Entitlement Offer on a best endeavours basis and attempt to place any Shortfall. The Lead Manager will receive:

a cash fee of 2% (plus GST) on all funds raised under the Entitlement Offer;
an additional cash fee of 4% (plus GST) on all funds raised from any New Shares and New Options placed by the Lead Manager under the Shortfall; and
2,000,000 Lead Manager Options. The Lead Manager Options will have identical terms to the New Options, except the exercise price for the Lead Manager Options will be \$0.15 and will expire 3 years from the date of the allotment of the New Shares the subject of the Entitlement Offer.

If any other broker places New Shares and New Options under the Shortfall, then they may be entitled to a cash fee of 4% (plus GST) on all funds raised by that placement. In these circumstances, the Lead Manager would not be entitled to the additional cash fee of 4% referred to above.

The Lead Manager's obligations in respect of the mandate letter are subject to satisfaction of a number of conditions precedent customary for offers of the kind of the Entitlement Offer.

Under the mandate letter, the Company gives certain representations, warranties and indemnities customary for offers of the kind of the Entitlement Offers.

The Company must pay the Lead Manager's fees and expenses on normal market terms and has agreed to indemnify the Lead Manager and persons connected with the Lead Manager against losses they may suffer in connection with the Entitlement Offer.

The Lead Manager or the Company may terminate the mandate letter at any time, without cause, by twenty days prior written notice.

Under the mandate letter, the Company has agreed to pay a stamping fee to ASX participants who have a broker stamp on the Entitlement and Acceptance Form that are received by the Share Registry by the Closing Date. The stamping fee will be a 2% of the total of an Application with a maximum of \$400 per Application.

6.7 Privacy

By filling out the Entitlement and Acceptance Form to apply for New Shares or paying your Application Monies by BPAY®, you are providing personal information to the Company.

The Privacy Act 1988 (Cth) regulates the way the Company collects, uses, disposes, keeps secure and gives people access to their personal information.

The Company is committed to respecting the privacy of your personal

information.

The Company collects, holds and uses that personal information in order to process your Application and to administer your Shareholding in the Company, including:

the Company maintaining a register of Shareholders in accordance with the Corporations Act;
the Company paying dividends to you;
the Company communicating with you, such as sending you annual reports, notices of meetings and any other document which the Company wishes to send to you as a Shareholder;
the Company carrying out general administration including monitoring, auditing, evaluating, modelling data, dealing with complaints and answering queries; and
the Company complying with its legal and regulatory obligations.

If you do not provide the information requested in the Entitlement and Acceptance Form, the Company may not be able to process or accept your application for New Shares.

Your personal information may also be provided to other members of the Predictive Group on the basis that they deal with such information in accordance with the Company's privacy policy.

Your personal information may be provided to the Company's agents or service providers on the basis that they deal with such information in accordance with the Company's privacy policy.

The types of agents and service providers that may be provided with your personal information and the circumstances in which your personal information may be disclosed are:

the Share Registry for ongoing administration of the share register (the Share Registry is contracted by the Company to maintain the register);
printers and mail houses for the purposes of preparation and distribution of documents to you and for handling mail;
professional service providers such as lawyers, accountants, auditors, consultants, and other professional advisers for the purpose of administering, and advising on, the New Shares and for any associated actions; and
other companies where the Company believes it is more efficient to outsource services or functions to those companies.

Your personal information may be provided to certain third parties. The types of third parties that may be provided with your personal information, and the circumstances in which your personal information may be disclosed, are:

• your financial adviser or broker (other than your tax file number

government, regulatory authorities or other people when permitted or required by law, such as ASIC or people inspecting the share register in accordance with the Corporations Act;
ASX; and
in certain circumstances and with safeguards to respect your privacy, potential or actual purchasers of an interest in the Company or the Company's business or any part thereof.

You have the right to gain access to your personal information held by, or on behalf of, the Company, subject to certain exemptions under the law. A reasonable charge for providing access to personal information may be charged for providing access to personal information. You can request access to your personal information by telephoning or writing to the Company Secretary as follows:

Company Secretary Predictive Discovery Limited Level 2, 9 Colin St West Perth WA 6005 Telephone: +61 8 9216 1000

6.8 Competent person's statement

Unless otherwise indicated, mineral exploration, Resource and reserve estimates contained in this Prospectus have been prepared in accordance with the JORC Code.

The information in this Prospectus that relates to exploration results is based on information compiled by Mr Paul Roberts (Fellow of the Australian Institute of Geoscientists). Mr Roberts is a full time employee of the Company and has sufficient experience relevant to the style of mineralisation and type deposits being considered to qualify as a Competent Person as defined by the JORC Code. Mr Roberts consents to the inclusion in this Prospectus of the matters based on his information in the form and context in which it appears.

6.9 Consents

Each of the parties referred to as consenting parties who are named below:

does not make the Entitlement Offer;
has not authorised, and has not caused the issue of this Prospectus;
has not made any statement in this Prospectus or any statement on which a statement made in this Prospectus is based, other than in the case of Mr Paul Roberts and the Major Shareholders, who have consented to the inclusion of statements in this Prospectus noted to have been made by them or to be based on statements made by them;
to the maximum extent permitted by law, expressly disclaims and takes no responsibility for any statements in or omissions from this Prospectus; and
has given and has not, before the lodgement of this Prospectus with ASIC, withdrawn its written consent to be named in this Prospectus in the form and context in which it is named.

Role	Consenting parties
Lead Manager	Canaccord BGF
Competent Person for the purposes of the JORC Code	Mr Paul Roberts
Share Registry	Link Market Services Limited
Major Shareholders	Acorn Capital
	Mrs Anne Amanda Harman
	Mr Phillip Harman as trustee for the P&A Harman Superfund
	Dr Tom Whiting
	Silver Whiting Pty Ltd as trustee for TWhiting Super Fund
	Mr Paul Roberts
	Dyspo Pty Limited
	Private Equity Capital Pty Ltd

6.10 Directors', experts' and advisers' consents and interests

Other than as set out below or elsewhere in this Prospectus no:

Director or proposed Director of the Company;
person named in this Prospectus as performing a function in a professional, advisory or other capacity in connection with the preparation or distribution of this Prospectus; or
promoter of the Company,

(together, the Interested Persons) holds at the date of this Prospectus or held at any time during the last two years, any interest in:

the formation or promotion of the Company;
property acquired or proposed to be acquired by the Company in connection with its formation or promotion, or the offer of Shares under the Entitlement Offer; or

• the offer of Shares.

Directors' Relevant Interests in securities

As at the date of this Prospectus, the Directors had the following Relevant Interests in Shares:

Director	Number
Mr Phillip Harman	1,954,688
Mr Paul Roberts	3,320,500
Dr Thomas Whiting	1,054,688
Dr Robert Danchin	nil
Mr Philip Henty	5,976,563

As at the date of this Prospectus, the Directors had the following Relevant Interests in Options:

Director	Exercise Price (A\$)	Expiry Date	Number
Mr Phillip Harman	\$0.25	20 August 2015	900,000
Mr Paul Roberts	\$0.25	20 August 2015	1,700,000
Dr Thomas Whiting	\$0.25	20 August 2015	600,000
Dr Robert Danchin	\$0.25	20 August 2015	600,000
Mr Philip Henty	\$0.25	20 August 2015	600,000

Remuneration

Directors are entitled to be remunerated by salary or other employment related benefits in accordance with their employment agreements. The table below sets out the remuneration paid to the Directors for the two financial years prior to the date of this Prospectus and for the current financial year until the date of this Prospectus:

Director	Remuneration paid in 30 June 2010 financial year	Remuneration paid in 30 June 2011 financial year	Remuneration paid in 30 June 2012 financial year to date of Prospectus
Mr Phillip Harman	Nil	\$50,001	\$45,833
Mr Paul Roberts	\$79,650	\$195,253	\$229,167
Dr Thomas Whiting	Nil	\$35,000	\$32,083
Dr Robert Danchin	Nil	\$35,000	\$32,083
Mr Philip Henty	Nil	\$35,000	\$32,083

Experts and advisers

Canaccord BGF have acted as Lead Manager of the Entitlement Offer. Details of the Lead Manager engagement and the fees payable to the Lead Manager in relation to the management of the Entitlement Offer as set out in section 6.6.

6.11 Australian taxation implications

Taxation implications will vary depending on the specific circumstances of individual Shareholders. Further, tax rules or their interpretation in relation to equity investments may change following the completion of the Entitlement Offer or Shortfall. You should obtain your own professional advice before concluding on the particular taxation implications that will apply to you if you participate in the Entitlement Offer or Shortfall.

6.12 Consents to lodgement

Each Director has given, and has not withdrawn, their consent to the issue of this Prospectus and to its lodgement with ASIC under the Corporations Act.

6.13 Governing law

This Prospectus and the contracts that arise from acceptance of the Applications are governed by the laws applicable in Western Australia and each Applicant submits to the non-exclusive jurisdiction of the courts of Western Australia.

7 Glossary

Term	Meaning
\$	Australian dollars.
Additional New Shares and New Options	The additional New Shares and New Options offered to Eligible Shareholders under this Prospectus above their Entitlement as set out in section 2.3 and Additional New Shares are the relevant additional New Shares.
AEST	Australian Eastern Standard Time.
AIFRS	Australian equivalents to International Financial Reporting Standards.
Applicants	An Eligible Shareholder who submits an Application together with Application Monies (each an Applicant).
Application	An application for New Shares and New Options under the Entitlement Offer made by an Applicant in an Entitlement and Acceptance Form or by payment via BPAY® or such other form as approved by the Company.
Application Monies	Monies received from persons applying for New Shares under the terms of the Entitlement Offer.
ASIC	Australian Securities & Investments Commission.
ASX	ASX Limited, or the market operated by it, as the context requires.
ASX Listing Rules	The official listing rules of ASX.
ASX Settlement	ASX Settlement Pty Limited.
ASX Settlement Operating Rules	The settlement and operating rules of ASX Settlement.
AWST	Australian Western Standard Time.
Board	The board of Directors of the Company.
Business Day	The meaning given in the ASX Listing Rules.
CHESS	The Clearing House Electronic Subregister System operated by ASX Settlement.
Closing Date	5.00pm (AEST) on 13 July 2012 (or such date as varied by the Company). Note that Applications made via BPAY® must be received

Term	Meaning
	by the Share Registry by 5.00pm (AEST) on 13 July 2012. See section 3.4 for further details.
Company or Predictive	Predictive Discovery Limited and where the context requires, includes its wholly owned subsidiaries.
Competent Person	The meaning given in the JORC Code
Constitution	The constitution of the Company as at the date of this Prospectus.
Corporations Act	The Corporations Act 2001 (Cth).
Director	A director of the Company.
Eligible Shareholder	The meaning given in section 2.7.
Entitlement	The number of New Shares and New Options for which an Eligible Shareholder is entitled to subscribe under the Entitlement Offer, in each case being 1 New Share for every 5 Shares held by the Eligible Shareholder on the Record Date together with 1 free attaching New Option for every 2 New Shares issued under the Entitlement Offer. Your Entitlement is set out in the Entitlement and Acceptance Form accompanying this Prospectus.
Entitlement and Acceptance Form	A personalised acceptance form in the form accompanying this Prospectus pursuant to which Applicants may apply for New Shares.
Entitlement Offer	The offer of New Shares and New Options pursuant to this Prospectus and Offer means the Entitlement Offer.
Entitlement Offer Proceeds	The proceeds received by the Company as a result of the issue of Shares the subject of the Entitlement Offer.
Exercise Price	The meaning given in section 6.4.
Expiry Date	The meaning given in section 6.4.
Existing Shares	Shares issued before 7.00pm (AEST) on the Record Date.
Ineligible Shareholders	Shareholders who are registered as holders of Existing Shares but to whom the Entitlement Offer is not being made as set out in section 2.7.
Interested Persons	The meaning given in section 6.10.
JORC Code	The 2004 Edition of the Australia Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, which comprises

Term	Meaning
	Appendix 5A of the Listing Rules.
Lead Manager Options	The 2,000,000 Options issued to the Lead Manager under the terms of the Lead Manager's mandate, as set out in section 6.6.
Lead Manager or Canaccord BGF	Canaccord BGF Limited
Major Shareholder	The meaning given in section 6.9.
New Options	The Options offered on the basis of, and under the terms of, the Entitlement Offer, the rights and liabilities of which are summarised in section 6.4.
New Shares	A Share offered for subscription on the basis of, and under the terms of, the Entitlement Offer, the rights and liabilities of which are summarised in section 6.3.
Offer Period	Refers to the period from the Opening Date to the Closing Date (inclusive of those dates).
Offer Price	\$0.08, the price payable for one New Share under the Entitlement Offer.
Opening Date	21 June 2012.
Options	The unlisted options to acquire Shares.
Predictive Group	The Company and its Related Bodies Corporate.
Prospectus	This document, dated 6 June 2012.
Record Date	The date for determining the Entitlement of Shareholders under the Entitlement Offer, being 7.00pm (AEST time) on 18 June 2012.
Related Body Corporate	The same meaning as in section 50 of the Corporations Act.
Relevant Interest	The same meaning as in section 9 of the Corporations Act.
Reserve or Ore Reserve	The meaning given in the JORC Code.
Resource or Mineral Resource	The meaning given in the JORC Code.
Share	A fully paid ordinary share in the capital of the Company.

Term	Meaning
Share Registry	Link Market Services Limited
Shareholder	The registered holder of a Share.
Shareholding	The Shares held by a Shareholder of the Company
Shortfall	Those New Shares and New Options not validly applied for by Shareholders under their Entitlement together with any New Shares and New Options that would have been offered to Ineligible Shareholders under the Entitlement Offer if they had been entitled to participate in the Entitlement Offer, which, subject to the Board's discretion regarding any applications received for Additional New Shares and New Options, will be placed by the Lead Manager.
Trading Day	The meaning given in the ASX Listing Rules.
US Securities Act	United States Securities Act of 1933, as amended.

Authorisation

This Prospectus is authorised by each Director of the Company under section 720 of the Corporations Act and signed by Paul Roberts on 6 June 2012 under section 351 of the Corporations Act.

Signed for and on behalf of Predictive Discovery Limited

---- Mr Paul Roberts Managing Director

Corporate Directory

Board of Directors

Mr Phillip Harman (Chairman) Mr Paul Roberts (Managing Director) Dr Tom Whiting (Non Executive Director) Dr Robert Danchin (Non Executive Director) Mr Philip Henty (Non Executive Director)

Company Secretary

Mr Ian Hobson

Share Registry

Link Market Services Limited Ground Floor 178 St Georges Terrace Perth WA 6000

Registered Office

Level 2 9 Colin Street West Perth WA 6005

Lead Manager

Canaccord BGF Limited Level 4 60 Collins Street Melbourne VIC 3000

AI assistant

PREDICTIVE DISCOVERY LIMITED — Capital/Financing Update 2012

65537_rns_2012-06-06_a140181c-2130-4895-99f4-3a2c1b136448.pdf

PREDICTIVE DISCOVERY LIMITED ACN 127 171 877

ENTITLEMENT OFFER PROSPECTUS

IMPORTANT INFORMATION

Important notices

Regulatory Information

Disclaimer

Forward-looking statements

Prospectus availability

laws.

Foreign jurisdictions

New Zealand

United States

Glossary

Enquiries

Privacy

Contents

Chairman's Letter

Key Offer Information

Key Dates

1 Investment Overview

1.1 Investment highlights

1.2 Key risks

1.3 The Entitlement Offer

1.4 Actions for Eligible Shareholders

1.5 Further information

2 Details of Entitlement Offer

2.1 Purpose of Entitlement Offer and use of funds

2.2 Structure of Entitlement Offer

2.3 Additional New Shares and New Options

2.4 No minimum subscription

2.5 Offer Price

2.6 Shortfall

2.7 Eligible Shareholders

2.8 Treatment of Foreign Shareholders

New Zealand

Ineligible Shareholders

2.9 Nominees, trustees and custodians

2.10 Trading of Entitlements

2.11 ASX quotation and trading of New Shares

2.12 Rounding and determining Entitlements

2.13 Ranking of New Shares

2.14 Application Monies

2.15 Withdrawal of the Entitlement Offer

2.16 CHESS

2.17 Optionholders

3 How to Apply

Eligible Shareholders

Foreign Shareholders

3.1 Choices available

3.2 If you wish the take up all or part of your Entitlement

3.3 Allow all or part of your Entitlement to lapse

3.4 Payment and return of Entitlement and Acceptance Form

Option 1: Submit your completed Entitlement and Acceptance Form together with a cheque, bank draft or money order.

Option 2: Pay via BPAY® payment

Effect of returning Entitlement and Acceptance Form or making BPAY® payment

3.5 Enquiries

4 Overview of the Company

4.1 Overview of Predictore™ technology

4.2 Summary of exploration projects

4.3 Overview of the Company's projects

Burkina Faso Gold Projects

Bonsiega Gold Project

Bangaba Project

Australian projects

Victorian Gold Exploration

4.4 Corporate structure and ownership

Structure

Ownership

4.5 Effect of the Entitlement Offer on the Company

Effect on capital structure

Shares

4.6 Financial position

Pro forma Statement of Financial Position

Notes of pro forma

Expenses of Entitlement Offer

4.7 Dividend history

4.8 Directors

PREDICTIVE DISCOVERY LIMITED Capital/Financing Update 2012