Silex Systems : Response to ASX Price Query Letter

Silex Systems Limited

A.C.N. 003 372 067

Mr Andrew Kabega
Adviser, Listings Compliance (Sydney) ASX Compliance Pty Ltd
20 Bridge Street
SYDNEY NSW 2000
Via email: andrew.kabega@asx.com.au

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
Dear Andrew,

We refer to your letter dated 9 May 2014 and respond to each question as follows:

The company is not aware of any information concerning it that has not been announced which, if known, could be an explanation for recent trading in the securities of the Company.

The company has no other explanation for the price decrease in the securities of the Company, other than the possibility that there is focus in the market relating to two of the Company's key activities:
i) The Paducah Laser Enrichment Plant Opportunity: Silex can confirm that negotiations continue between General Electric-Hitachi Global Laser Enrichment LLC (GLE) and the US Department of Energy (DOE) with regard to GLE's proposal to establish a laser enrichment facility in Paducah, Kentucky (the "Paducah Laser Enrichment Facility" or "PLEF"). The DOE announced in November 2013 that GLE's proposal for the potential establishment of a commercial uranium tails processing facility, based upon the SILEX Technology, had been selected for future operations at the Paducah uranium enrichment site (refer to ASX release dated 28/11/13). This led to the commencement of confidential negotiations between GLE and the DOE, which are expected to be completed as early as the current quarter.
ii) ARENA Conditional Funding Contribution for Proposed Solar Systems Mildura Power Station Project: There is considerable speculation in the media regarding future funding capabilities of the Australian Renewable Energy Agency (ARENA) in light of reports on the Federal Government's Budget planning, including with regard to conditional funding commitments to the proposed 100MW Solar power station being planned by Silex subsidiary Solar Systems Pty Ltd. At this stage the Company continues to proceed with the Mildura project planning and awaits the outcome of the Federal Budget and further advice from ARENA before making any further comment.

The Company understands its continuous disclosure obligations and believes that it is in compliance with listing rule 3.1.
We trust that this response satisfies your query, 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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Yours sincerely,

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