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## ISSUED CAPITAL (CONTINUED) 

## 29. 

Effective 1 July 1998, the Corporations legislation in place abolished the concepts of authorised capital and par share values. Accordingly, the Parent does not have authorised capital nor par value in respect of its issued shares. 

## (d) Escrow Restrictions 

There are no current escrow restrictions on the issued capital of the Company. 

## (e) Options on Issue 

Unissued ordinary shares of the company under option at the date of this report are as follows: 

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* The above options are exercisable at any time on or before the expiry date. 

** These options were issued pursuant to the Metals X Limited Employee Option Scheme and can only be exercised pursuant to the scheme rules. 

Share options carry no right to dividends and no voting rights. 

## (f) Option conversions 

There were no option conversions during the financial year. 

## (g) Capital management 

Capital managed by the Board includes shareholder equity, which was $290,056,226 at 30 June 2011 (2010: $290,141,787). When managing capital, management’s objective is to ensure the entity continues as a going concern as well as to maintain optimal returns to shareholders and benefits for other stakeholders. Management also aims to maintain a capital structure that ensures the lowest cost of capital available to the entity. Managed capital is disclosed on the face of the statement of financial position and comprises shareholder equity, accumulated losses and reserves. 

Management may adjust the capital structure to take advantage of favourable costs of capital or higher returns on assets. As the market is constantly changing, management may issue new shares or sell assets to raise cash, change the amount of dividends to be paid to shareholders (if at all) or return capital to shareholders. 

During the financial year ending 30 June 2011, management did not pay a dividend and does not expect to pay a dividend in the foreseeable future. 

The Consolidated Entity monitors the adequacy of capital by analysing cash flow forecasts for each of its projects. To a lesser extent, gearing ratios are also used to monitor capital. Appropriate capital levels are maintained to ensure that all approved expenditure programs are adequately funded. This funding is derived from an appropriate combination of debt and equity. 

The gearing ratio is calculated as net debt divided by total capital. Net debt is defined as interest bearing liabilities and total capital is calculated as ‘equity as shown in the statement of financial position (including minority interest). 

During the year ended 30 June 2011, interest bearing liabilities decreased as a result of the Consolidated Entity making repayments of its finance lease facility to finance property, plant and equipment at its Renison Tin Project (refer to note 38). The net effect was a decrease in the gearing ratio. 

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The entity is not subject to any externally imposed capital requirements. 

