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Mindax To Bank A$2.5M From Sophisticated Investors

Mindax (ASX: MDX) has received binding commitments for a placement raising A$2.5 million at a 21% premium to the company's last traded share price of $0.07.

The placement, which is also at a premium to the 30 day volume weighted average price, of 29.5 million shares at $0.085 is being made to sophisticated investors Zhensheng Zhuang and Chenfei Zhuang.

The funds raised from the placement will be applied to Mindax's project activities and to working capital.

Last week Mindax executed a farm-in agreement with the investors which provides for $2.5 million to be spent on the Meekatharra North Gold Project over three years in exchange for a 51% interest in the project.

Dr Steve Ward, managing director, commented: "We are delighted with this placement. It is a real vote of confidence in the company.

"We have been building momentum on our significant portfolio of key commodities and these funds will enable us to step up these work programs."

Under the farm-in deal, Zhensheng Zhuang and Chenfei Zhuang are required to spend an initial $500,000 by August 2013 before the first opportunity to withdraw. The agreement is subject to certain government approvals.

Mindax will continue to manage the tenement and provide technical expertise during the earn-in period.

The Meekatharra North Project is situated 40 kilometres north of Meekatharra and 20 kilometres along structure from the Paddy's Flat gold field, where 2.5 million ounces of gold has been produced.

The project also lies immediately along strike from Doray Minerals' (ASX: DRM) high grade Andy Well gold project, which hosts a resource of 831,000 tonnes at 12.7 grams per tonne (g/t) for 338,000 contained gold ounces and is scheduled for first production in 2013.

Work by Doray suggests that the mineralised structures encountered to date continue southwards into Mindax's tenements.

Mindax expects work on the ground, including surveys to determine drill targets and a subsequent drill program to assess these targets, to begin during the first half of 2013.

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