Silex Systems : Chair's Address to Shareholders - 2014 AGM

Silex Systems Limited

A.C.N. 003 372 067

Level 8, Suite 8.03

56 Clarence Street

Sydney NSW 2000 Australia

PO Box 364

Sydney NSW 2001

Tel: + 61 2 9704 8888

Fax: +61 2 9279 1051 www.silex.com.au

Good morning, ladies and gentlemen, and fellow shareholders. It is with great pleasure that
I present my first Annual General Meeting as Chair of Silex Systems.
After my opening comments, our Founder, Managing Director and CEO, Dr Michael Goldsworthy will provide an operational update. We are also joined today by our other fellow directors Andrew Stock and Chris Wilks and by our Chief Financial Officer and Company Secretary, Julie Ducie.
Let me start proceedings today by stating categorically, Silex's uranium enrichment
technology is revolutionary.
While we have not been operating in ideal market conditions, I acknowledge we have also missed some significant commercial milestones in the development of our technologies which have disappointed our investors and loyal shareholders. Consequently, our share price has declined significantly since the Fukushima event and particularly in the last 12 months reflecting these issues and the restructure implemented by the licensee of our SILEX technology, Global Laser Enrichment, in July.
Our job is now to provide a clear vision and deliver value, whilst we await the inevitable recovery in the nuclear fuel markets. Most importantly, we need to rebuild trust and confidence with the market.
All of this requires strong action. The major strategic review is the result of that call for action and is focused on returning Silex back to a streamlined entity, with a primary focus on our core uranium enrichment technology. The strategic review announced on the 30th June continues to be implemented and our Managing Director will update you on our progress in his upcoming presentation.
We are implementing a number of initiatives which we believe will deliver value to our shareholders, including the accelerated transition to market of the other technologies being developed by Solar Systems and Translucent. We are eager to ensure that these technologies can successfully transition with the help of strong strategic partners and/or investors who are better positioned to commercially leverage these technologies. The timing of these efforts will ultimately be determined by the responses we receive from industry.
In addition, we have put a number of initiatives in place since I became Chair:

 Ensuring we are pursuing the objectives outlined in the Strategic Review expeditiously and sensibly;

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 Commissioning a "first principles" review of the uranium enrichment market to confirm the underlying value of our SILEX technology, notwithstanding the negative shift in the nuclear industry since Fukushima, and identifying any opportunities to further mitigate risk and maximise value;

 Preparing the company, including key management personnel and the Board, for a full review of roles and remuneration to ensure the transformation to a simpler, streamlined entity with associated cost reductions; and

 Committing to achieving the milestones we set so we can rebuild confidence with our shareholders and the broader market.

Looking ahead, some of the changes you can expect to see are:

 Value realisation from the Solar Systems and Translucent technologies;

 More considered communication to ensure we do not over-commit to timelines or milestones that we don't control;

 Better communication around the value of our core SILEX technology, which will depend on future natural uranium and enriched uranium requirements and their respective market prices. We continue to believe that the SILEX technology has a very important role to play in providing enrichment services in the future which will create significant value for our shareholders.

Again, I acknowledge the Company's share price performance has been extremely disappointing for us as a company and, most importantly, for our shareholders and I can assure you that the Board and Management are very focused on turning around the fortunes of the Company. Rebuilding confidence and value in the Company will take some time, just like the inevitable recovery of the nuclear fuel market is taking time.
For the year ahead, Silex has a program of clear activities and goals, guided by our strategic review. We are here for the long term, committed to commercialising our transformational SILEX uranium enrichment technology and driving its underlying value. However, we are also focused on the near-term, ensuring we do all that we can to deliver value through the Solar Systems and Translucent technologies.
On behalf of my fellow Directors, I wish to thank you, our shareholders, for your ongoing support, as well as our staff members, who continue to work tirelessly to achieve our goals. As always, we appreciate your feedback on our activities.
With that, I'd like to now handover to our Managing Director and CEO, Dr Michael
Goldsworthy.
Further information on the Company's activities can be found on the Silex website:
www.silex.com.auor by contacting the persons listed below.

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In June 2014, a major strategic review of Silex Systems Limited (ASX: SLX) (OTCQX: SILXY) resulted in a significant restructure of the Company. Under the restructure, the Board determined to refocus efforts on the Company's primary economic asset, and to significantly reduce cash burn beyond FY 2015.

This strategic review would allow Silex to support uranium enrichment technology licensee, GE- Hitachi Global Laser Enrichment with their efforts to bring the SILEX Technology to market. Should this be successfully achieved, Silex could earn attractive royalty revenues, under a technology commercialisation and license agreement, signed originally in 2006.

Under the restructure, it was also announced that the transitions to market for subsidiaries Solar Systems and Translucent would be accelerated, and that operations at ChronoLogic would cease, all during FY2015.

For more detailed information on Silex Systems Limited, please visit www.silex.com.au

Silex Systems is a research and development Company whose assets are its proprietary rights in various technologies, including, but not limited to, the SILEX technology, Solar Systems technology and business , Translucent technology and ChronoLogic technology. Several of the Company's technologies are in the development stage and have not been commercially deployed, and therefore are high-risk. Accordingly, the statements in this announcement regarding the future of the Company's technologies and commercial prospects are forward looking and actual results could be materially different from those expressed or implied by such forward looking statements as a result of various risk factors.

Some risk factors that could affect future results and commercial prospects include, but are not limited to: results from the SILEX uranium enrichment commercialisation program; the demand for enriched uranium; the risks associated with the development of Solar Systems technology and related marketing activities; the outcomes of the Company's interests in the development of various semiconductor, photonics, instrumentation and alternative energy technologies; the time taken to develop various technologies; the development of competing technologies; the potential for third party claims against the Company's ownership of Intellectual Property associated with its numerous technologies; the potential impact of government regulations or policies; and the outcomes of various commercialisation strategies undertaken by the Company.

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