Silex Systems Ltd : Annual General Meeting Chairman's Address

Silex Systems Limited

A.C.N. 003 372 067

Good morning, ladies and gentlemen, and fellow shareholders.

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
My name is Steve Burdon. As your Chairman, I am delighted to have this opportunity to speak with you about the significant progress your Company has made throughout the 2013 financial year.

After my opening comments, I will ask our Managing Director and CEO, Dr Michael
Goldsworthy, to provide the operational update.
Now I would like to introduce my fellow directors: Michael Goldsworthy, Colin Goldschmidt, Lisa McIntyre, Andrew Stock and Chris Wilks.

Silex Systems is evolving into a global diversified clean energy company. The past year has seen Silex achieve a number of important milestones that demonstrate significant commercial progress for both of our energy assets, namely, the SILEX laser uranium enrichment technology and the utility-scale solar technology being developed by Solar Systems.
Both technologies are new generation and at the cutting edge of innovation, with potential to lead their field whilst being disruptive within their respective markets.
In May 2013, we received confirmation from Global Laser Enrichment (GLE) that our enrichment technology had passed a critical milestone, known as the Test Loop Program. Basically, the achievement of the milestone confirms that the SILEX technology works at a significant scale in a demonstration setting.

In September 2012, the US Nuclear Regulatory Commission (NRC) approved the world's first license to construct and operate a commercial SILEX laser enrichment plant in Wilmington, North Carolina. Completing these two milestones triggered a US$15 million milestone payment.

Also during August this year, GLE submitted a non-binding proposal in response to a Request for Offer from the US Department of Energy for the establishment of an enrichment facility at Paducah, Kentucky, the objective being to convert very large stockpiles of depleted uranium tails into natural uranium, utilising the SILEX technology. If this proposal goes ahead, and there are several qualifying criteria, it would be equivalent to one of the world's largest uranium mines operating for up to 40 years, translating to a potentially valuable royalty flow back to Silex.
Casting our attention to the Solar Systems business, following our 1.5 MW Mildura Solar Power Demonstration Facility being connected to the grid in April, the facility was officially opened in July by the Victorian Minister for Energy and Resources, the Honourable Nicholas Kotsiras.
Subject to successful outcomes from our current cost reduction and engineering optimisation program, we believe this technology could deliver significant economic benefits for Solar Systems and our Group.
We are also pleased to have progressed the construction of our 1MW facility in Saudi Arabia
- a key future market for this innovative technology. An option for an additional site has also been secured in California, USA and we are currently assessing several other mid-sized global commercial project opportunities.
We have also made further progress with our Translucent and ChronoLogic business units, and Michael will cover highlights from those divisions in his presentation.

Our financial results were very solid for the 2013 financial year. We managed to maintain a healthy cash position whilst continuing to invest in our technologies. Revenue from continuing operations was $23.5 million up from $9.5 million for FY2012. We recorded a very small net loss for the year and our improved result was largely due to the receipt of the US$15 million milestone payment from GLE. The result also reflects an improved operational cost base, a favourable R&D Tax Incentive program and government grants.

We have remained acutely focused on improving market sentiment and our share price, and during the year stepped up our efforts with a new investor and public relations program. We introduced an investor newsletter and increased communications with both current and potential shareholders. These activities will continue into the New Year and we believe will provide a good platform for us to keep you fully informed of our progress and the opportunities ahead. As always, your Board and Management teams are interested in your
feedback on all of these initiatives.

In line with a focused strategy to expand our share register in the US, where our SILEX technology is being developed, Silex Systems listed on the OTCQX exchange. This platform is reserved for high quality non-US companies and is an easy way for US investors to trade in our securities.

Your Board decided last year to bolster our executive management capability, with the goal of providing greater focus on the commercialisation phases of our various businesses. This strategy led us to the active recruitment of additional executives within the Group, including the recruitment of a Chief Executive Officer for the Solar Systems business, currently underway, as well as the promotion of our long serving Vice President of Engineering Dr Andrew Clark, to a business unit operational leadership role at Translucent.
We will continue to recruit and boost our executive ranks, as and when it makes commercial sense.

Our commitment to Board renewal continued this year and I am pleased to report that it led to the appointment of two new directors during FY2013.
Dr Lisa McIntyre was appointed in July 2012 and has extensive experience in company directorships and her contribution is highly valued by the Board.
We have also recently welcomed Andrew Stock, who was appointed to the Board on 1
August 2013. Andrew brings a wealth of energy industry experience to the Board and his appointment will continue to strengthen and diversify your Board's skill set. Silex Directors unanimously recommend shareholders vote to formally elect Andrew today.
Chris Wilks who has been one of your long standing Directors also stands for re-election today. Chris has made invaluable contributions both to the Board and Management. His deep legacy knowledge, financial skills, particularly relating to GE and GLE, remain a significant asset and we strongly recommend shareholders vote for his re-election at today's AGM.
Finally, Peter Campbell retired from the Board in September. My fellow Board members and I wish to officially thank Peter, who provided 17 years of service on the Silex Board. Peter has been an exemplary Director who made immeasurable contributions to the Board during his period of service. I am sure you will join me in wishing Peter well in his future endeavours.
With our recent changes, we now believe we have a good mix of skills, experience and industry knowledge for the current opportunities and challenges, but we will continue to
review the best Board composition for our business during the next 12 months.

Silex's People and Remuneration Committee have continued to address shareholder concerns with the remuneration of key management and non-executive Directors. Throughout the 2013 financial year, we implemented additional initiatives to provide greater clarity and links between remuneration and the execution of the Group's strategy and performance, designed to take performance into account at all times when reviewing total remuneration for all Group employees.
In finalising our short term incentive awards for our CEO and other senior managers, we have taken into account share price over the year, therefore significantly lower entitlements than normal have been provided to continue our policy of aligning incentive payments with total shareholder returns.
My fellow Directors and I look forward to answering any questions you may have about our remuneration practices, or indeed any other questions with regards to your company following the conclusion of our formal proceedings today.
Your Board wishes to thank the entire Silex Systems team. Our progress in reaching the two major milestones during the year has required tenacity and dedication.

I would now like to hand over to our Managing Director and CEO, Dr Michael Goldsworthy to provide you with a more detailed update on our operations.
Further information on the Company's activities can be found on the Silex website:
www.silex.com.auor by contacting the persons listed below:

Silex Systems Limited (ASX: SLX) (OTCQX: SILXY) is a world leader in research, development and commercialisation of leading edge technologies in key strategic markets, including nuclear power, solar power, semiconductor materials and instrumentation. Silex is a member of the S&P/ASX 300 index and operates four divisions:

ultra-low cost USB-inSync™ platform, targeting applications in the electronic instrumentation markets.

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

Forward Looking Statements and Business Risks

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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