Panex Resources Inc. - FORM 10-K

Attached files

file	filename
EXCEL - IDEA: XBRL DOCUMENT - Panex Resources Inc.	Financial_Report.xls
EX-32 - EXHIBIT 32 - Panex Resources Inc.	exhibit32.htm
EX-31.2 - EXHIBIT 31.2 - Panex Resources Inc.	exhibit31-2.htm
EX-31.1 - EXHIBIT 31.1 - Panex Resources Inc.	exhibit31-1.htm

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

ýANNUAL REPORT UNDER SECTION 13 0R 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐TRANSITION REPORT UNDER SECTION 13 0R 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________________ to _________________

Commission file number 000-51707

PANEX RESOURCES INC.

(Exact name of registrant as specified in its charter)

Incorporated in the State of Nevada

(State or other jurisdiction of incorporation or organization)

00-0000000

(I.R.S. Employer Identification No.)

Coresco AG, Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland

(Address of principal executive offices)

+41 7887 96966

(Issuer’s telephone number)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, par value $0.001 per share

(Title of each class)

Name of each exchange on which registered: OTCQB

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

☐ Yes ý No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. ☐Yes ý No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

ýYes ☐ No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

ýYes ☐ No

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☐ Yes ý No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “accelerated filer”, “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Larger accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐

(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

ýYes ☐ No

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter: $962,198 as of February 28, 2013.

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class	Outstanding at November 1, 2013
Common Stock – $0.001 par value	118,261,507

Documents incorporated by reference: Refer to Exhibits

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

INDEX	Page
PART I	5
ITEM 1 – DESCRIPTION OF BUSINESS	5
ITEM 1A – RISK FACTORS	7
ITEM 1B – UNRESOLVED STAFF COMMENTS	7
ITEM 2 – DESCRIPTION OF PROPERTY	7
ITEM 3 – LEGAL PROCEEDINGS	7
ITEM 4 – MINING SAFETY DISCLOSURES	7
PART II	8
ITEM 5 – MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASE OF EQUITY SECURITIES	8
ITEM 6 – SELECTED FINANCIAL DATA	11
ITEM 7 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	11
ITEM 7A – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	15
ITEM 8 – FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA	15
ITEM 9 – CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	15
ITEM 9A – CONTROLS AND PROCEDURES	15
ITEM 9B – OTHER INFORMATION	17
PART III	18
ITEM 10 – DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE	18
ITEM 11 – EXECUTIVE COMPENSATION	21
ITEM 12 – SECURITY OWNERSHIP OF CERTAIN BENEFICIAL HOLDERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS	22
ITEM 13 – CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE	23
ITEM 14 – PRINCIPAL ACCOUNTING FEES AND SERVICES	24
PART IV	25
ITEM 15 – EXHIBIT, FINANCIAL STATEMENT SCHEDULES	25
SIGNATURES	26
EXHIBIT A	27
FINANCIAL STATEMENTS	27
BALANCE SHEETS	29
STATEMENTS OF OPERATIONS	30
STATEMENTS OF CASH FLOWS	31
STATEMENTS OF STOCKHOLDER’S EQUITY (DEFICIENCY)	32
NOTES TO FINANCIAL STATEMENTS	33

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

Uncertainties Relating To Forward-Looking Statements

The information in this annual report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act (SEC) of 1934. These forward-looking statements involve risks and uncertainties, including statements regarding the Company’s capital needs, business strategy and expectations. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements.

In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict”, “potential”, or “continue”, the negative of such terms or other comparable terminology. Actual events or results may differ materially. In evaluating these statements, you should consider various factors, including the risks outlined from time to time, in other reports the Company files with the Securities and Exchange Commission.

The information constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements in this Form 10-K for the fiscal year end, are subject to risks and uncertainties that could cause actual results to differ materially from the results expressed in or implied by the statements contained in this report. As a result, the identification and interpretation of data and other information and their use in developing and selecting assumptions from and among reasonable alternatives requires the exercise of judgment. To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results, and accordingly, no opinion is expressed on the achievability of those forward-looking statements. No assurance can be given that any of the assumptions relating to the forward-looking statements specified in the following information are accurate.

All forward-looking statements are made as of the date of filing of this Form 10-K and the Company disclaims any obligation to publicly update these statements, or disclose any difference between its actual results and those reflected in these statements. The Company may, from time to time, make oral forward-looking statements. The Company strongly advises that the above paragraphs and the risk factors described in this Annual Report and in the Company’s other documents filed with the United States Securities and Exchange Commission should be read for a description of certain factors that could cause the actual results of the Company to materially differ from those in the oral forward-looking statements. The Company disclaims any intention or obligation to update or revise any oral or written forward-looking statements whether as a result of new information, future events or otherwise.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

PART I

ITEM 1 – DESCRIPTION OF BUSINESS

Background

Panex Resources Inc. (“Panex” or the “Company”) is a Nevada corporation that was incorporated on May 28, 2004.

The Company conducts principal and technical activities from Coresco AG, Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland. The telephone number is +41 41 711 0281. These offices are provided to the Company on a month-to-month basis. The Company believes these offices are adequate for the business requirements during the next 12 months. The Company does not own any real property. Panex maintains its statutory registered agent’s office at 1859 Whitney Mesa Drive, Henderson, Nevada, 89014.

Panex is an exploration stage company engaged in the acquisition and exploration of mineral properties. The Company’s plan of operations is to conduct mineral exploration activities on mineral properties in order to assess whether these claims possess commercially exploitable mineral deposits. Panex’s exploration program will be designed to explore for commercially viable deposits of base and precious minerals, such as gold, silver, lead, barium, mercury, copper, and zinc minerals.

Panex has an authorized capital of 500,000,000 shares of common stock with a par value of $0.001 per share with 118,261,507 shares of common stock currently issued and outstanding. On August 30, 2010, the authorized capital was increased from 75,000,000 shares of common stock to 500,000,000 shares of common stock.

Panex has not been involved in any bankruptcy, receivership or similar proceedings. There have been no material reclassifications, mergers, consolidations or purchases or sales of a significant amount of assets not in the ordinary course of Panex’s business.

Currently, Panex has not obtained an employer identification number for the purpose of registering to do business in the United States. Panex does not currently conduct any business in the United States nor employ any staff in the United States and is therefore not required by law to obtain an employer identification number at this time. Panex will take immediate steps to obtain an employer identification number if it becomes necessary to do so at any time in the future.

Plan of Operation

Panex is an Exploration Stage Company. Panex’s principal business is the acquisition and exploration of mineral resources. Panex currently has no interest in any mineral resources or properties but is continuing to identify and assess viable mineral properties or mineral projects.

Panex is also a “shell” company as defined by the SEC as a result of only having nominal operations and nominal assets.

Panex has not generated any revenues from its mineral exploration activities. From the time of its incorporation in 2004 to early 2008, Panex was actively engaged in the exploration of various mineral projects that were prospective for gold, silver and copper. Since 2008, a combination of limited exploration success and a dwindling of its working capital caused Panex to withdraw from its mineral exploration projects.

During the next 12 months, management’s objective is to recapitalize Panex, continue to raise new capital and to seek new investment opportunities in the mineral sector. As is evident from the “Background” section above and previous SEC filings, Panex has in the past successfully negotiated agreements enabling it to earn an interest in a number of different mineral properties. Consequently, management believes that its worldwide industry contacts will make it possible to identify and assess new projects for acquisition purposes.

Panex is seeking a viable business opportunity through acquisition, merger or other suitable business combination method, with a focus on undervalued mineral properties for eventual acquisition. Panex intends to concentrate its acquisition efforts on mineral properties or mineral exploration businesses that management believes to be undervalued or that management believes may realize a substantial benefit from being publicly owned. Panex will continue to identify and assess undervalued mineral properties when capital raisings are completed. A small number of mineral properties are presently being reviewed, but it is too early to say whether they may be considered appropriate for acquisition.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

On June 15, 2012, the Securities and Exchange Commission declared Panex’s Form S-1 Registration Statement effective, file number 333-172375, permitting Panex to offer up to 30,000,000 shares of common stock at $0.08 per share. The offering was being conducted on a best efforts basis and there was no underwriter involved in this public offering. Through August 31, 2012, Panex received and accepted 22 subscription agreements and received an aggregate $978,989 in proceeds from those subscriptions and issued 12,237,075 shares of common stock. No further subscriptions were received and the offering was closed on December 12, 2012. Panex utilized the proceeds to ongoing operations, paying accounts payable, paying for offering expenses, assessing and evaluating possible new mineral project opportunities, and, subject to acquiring any such new projects, funding the exploration on such projects.

The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts or classification of liabilities that may result from the possible inability of the Company to continue as a going concern.

Property Interests

Panex does not have any mineral property assets or mineral property interests.

Competition

Panex competes with other mining and exploration companies possessing greater financial resources and technical facilities than Panex in connection with the acquisition of mineral exploration claims and in connection with the recruitment and retention of qualified personnel. Many of Panex’s competitors have a very diverse portfolio and have not confined their market to one mineral or property, but explore a wide array of minerals and mineral exploration properties. Some of these competitors have been in business for longer than Panex and may have established more strategic partnerships and relationships than Panex.

Management believes that it will have a competitive advantage over its competitors due to its network of contacts, which will enable it to identify and acquire prospective mineral properties more quickly and efficiently than many of its competitors.

Government Controls and Regulations

Panex is not subject to any government controls or regulations as the Company has no interests in any mineral projects.

If and when Panex acquires a mineral property asset or a mineral property interest, its business may be subject to various levels of government controls and regulations, which are supplemented and revised from time to time. Changes to current local, state or federal laws and regulations in the jurisdictions where Panex will operate could require additional capital expenditures and increased operating and/or reclamation costs. Panex is unable to predict what additional legislation or revisions may be proposed that might affect its business or when any such proposals, if enacted, might become effective. Such changes, however, could require increased capital and operating expenditures and could prevent or delay certain operations by Panex or the property operators. Although Panex is unable to predict what additional legislation, if any, might be proposed or enacted, additional regulatory requirements could render certain exploration activities uneconomical.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

Patents/Trade Marks/Licences/Franchises/Concessions/Royalty Agreements or Labour Contracts

Panex currently does not own any patents or trade marks. Also, Panex is not party to any license or franchise agreements, concessions, royalty agreements or labor contracts arising from any patents or trademarks.

Number of Total Employees and Number of Full Time Employees

There are no employees at the present time, with the exception of its officers.

ITEM 1A – RISK FACTORS

Panex is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required under this item.

ITEM 1B – UNRESOLVED STAFF COMMENTS

Panex is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required under this item.

ITEM 2 – DESCRIPTION OF PROPERTY

ITEM 3 – LEGAL PROCEEDINGS

Panex is not a party to any pending legal proceedings and, to the best of Panex’s knowledge, none of Panex’s assets are the subject of any pending legal proceedings.

ITEM 4 – MINING SAFETY DISCLOSURES

There are no current mining activities at the date of this report.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

PART II

ITEM 5 – MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASE OF EQUITY SECURITIES

a.	Market Information

Panex’s shares of common stock were quoted on the FINRA OTC Bulletin Board under the symbol “DBGF” from March 8, 2006 to December 17, 2007. Since then Panex’s shares of common stock have been quoted on the OTCQB under the symbol “OTCQB:DBGF”.

The following table gives the high and low bid information for each fiscal quarter Panex’s common stock has been quoted for the last two fiscal years. The bid information was obtained from OTC Markets, Inc. and reflects inter-dealer prices, without retail mark-up, mark-down or commission, and may not represent actual transactions.

High & Low Bids
Period ended	High	Low	Source
31 August 2013	$0.02	$0.00	OTC Markets, Inc.
31 May 2013	$0.02	$0.00	OTC Markets, Inc.
28 February 2013	$0.02	$0.00	OTC Markets, Inc.
30 November 2012	$0.06	$0.02	OTC Markets, Inc.
31 August 2012	$0.10	$0.03	OTC Markets, Inc.
31 May 2012	$0.10	$0.06	OTC Markets, Inc.
28 February 2012	$0.08	$0.05	OTC Markets, Inc.
30 November 2011	$0.08	$0.04	OTC Markets, Inc.

b.	Holders of Record

Panex has approximately 69 holders of record of Panex’s common stock as of August 31, 2013 according to a shareholders’ list provided by Panex’s transfer agent as of that date. The number of registered shareholders does not include any estimate by Panex of the number of beneficial owners of common stock held in street name. The transfer agent for Panex’s common stock is Empire Stock Transfer Inc., 1859 Whitney Mesa Drive, Henderson, Nevada, 89014 and their telephone number is 702-818-5898.

Dividends

There are no restrictions in Panex’s Articles of Incorporation or By-laws that restrict Panex from declaring dividends. The Nevada Revised statutes, however, do prohibit Panex from declaring dividends where, after giving effect to the distribution of the dividend:

1. Panex would not be able to pay its debts as they become due in the usual course of business; or

2. Panex’s total assets would be less than the sum of its total liabilities, plus the amount that would be needed to satisfy the rights of stockholders who have preferential rights superior to those receiving the distribution.

Panex has declared no cash dividends on its shares of common stock and is not subject to any restrictions that limit its ability to pay cash dividends on its shares of common stock. Cash dividends are declared at the sole discretion of Panex’s Board of Directors.

d.	Unregistered Sales of Equity Securities and Use of Proceeds

There have been no sales of unregistered securities within the last three years that would be required to be disclosed pursuant to Item 701 of Regulation S-K, except for the following:

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

June 15, 2012 – S-1 Registration Statement Effective

On June 15, 2012, the Securities and Exchange Commission declared Panex’s Form S-1 Registration Statement effective, file number 333-172375, permitting Panex to offer up to 30,000,000 shares of common stock at $0.08 per share. The offering is being conducted on a best efforts basis and there is no underwriter involved in this public offering. At the close of the public offer on December 12, 2012, Panex has received and accepted 22 subscription agreements and received an aggregate $978,989 in proceeds from those subscriptions and issued 12,237,075 shares of common stock. Panex utilized the proceeds to ongoing operations, paying accounts payable, paying for offering expenses, assessing and evaluating possible new mineral project opportunities, and, subject to acquiring any such new projects, funding the exploration on such projects.

March 28, 2012 – 3,196,971 Shares For Debt Offering

During March 2012, the Company entered into debt settlement agreements with creditors in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.08 per share. As a result, the Company will no longer be indebted as further set forth in the debt settlement agreements as follows:

-	Dr Georg Schnura, a creditor, for $175,758, for a total of 2,196,971 shares at a price of $0.08 per share.

-	Victor Dario, a creditor, for $80,000, for a total of 1,000,000 shares at a price of $0.08 per share.

February 24, 2012 - 8,477,553 Shares For Debt Offering

On February 24, 2012, the board of directors approved the settlement of debt for shares at a settlement price of $0.02 per restricted share. Panex settled $169,551 in debt in this closing, and on February 24, 2012 issued an aggregate 8,477,553 restricted shares of common stock to three non-US creditors outside the United States.

The share certificates for this common stock were issued June 20, 2012.

December 2010 - $0.05 Shares For Debt Offering

On December 20, 2010, the board of directors approved the settlement of debt for shares at a settlement price of $0.05 per restricted share. Panex settled an aggregate $615,156 in debt in this closing, and issued an aggregate 12,303,123 restricted shares of common stock to seven non-US creditors outside the United States.

Panex set the value of the restricted shares arbitrarily without reference to its assets, book value, revenues or other established criteria of value. All the restricted shares issued in this offering were issued for investment purposes in a “private transaction”.

For the seven non-US creditors outside the United States in this closing, Panex relied upon Section 4(2) of the Securities Act of 1933 and Rule 903 of Regulation S promulgated pursuant to that Act by the Securities and Exchange Commission. Management is satisfied that Panex complied with the requirements of the exemption from the registration and prospectus delivery of the Securities Act of 1933. The settlement of debt was not a public offering and was not accompanied by any general advertisement or any general solicitation. Panex received from each creditor a completed and signed shares for debt agreement containing certain representations and warranties, including, among others, that (a) the creditor was not a U.S. person, (b) the creditor accepted the shares for debt for their own investment account and not on behalf of a U.S. person, and (c) there was no prearrangement for the resale of the shares with any buyer. No offer was made or accepted in the United States and the share certificates representing the shares were issued bearing a legend with the applicable trading restrictions.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

January 2010 - $0.01 Shares For Debt Offering

On January 7, 2010, the board of directors approved the settlement of debt for shares at a settlement price of $0.01 per restricted share. De Beira settled $10,000 in debt in this closing, and on January 7, 2010 issued an aggregate 1,000,000 restricted shares of common stock to one non-US creditor outside the United States.

De Beira set the value of the restricted shares arbitrarily without reference to its assets, book value, revenues or other established criteria of value. All the restricted shares issued in this offering were issued for investment purposes in a “private transaction”.

For the one non-US creditor outside the United States in this one closing, De Beira relied upon Section 4(2) of the Securities Act of 1933 and Rule 903 of Regulation S promulgated pursuant to that Act by the Securities and Exchange Commission. Management is satisfied that De Beira complied with the requirements of the exemption from the registration and prospectus delivery of the Securities Act of 1933. The settlement of debt was not a public offering and was not accompanied by any general advertisement or any general solicitation. De Beira received from each creditor a completed and signed shares for debt agreement containing certain representations and warranties, including, among others, that (a) the creditor was not a U.S. person, (b) the creditor accepted the shares for debt for their own investment account and not on behalf of a U.S. person, and (c) there was no prearrangement for the resale of the shares with any buyer. No offer was made or accepted in the United States and the share certificates representing the shares were issued bearing a legend with the applicable trading restrictions.

e.	Penny Stock Rules

The SEC has also adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system).

The shares of Panex will remain penny stock for the foreseeable future. The classification of penny stock makes it more difficult for a broker-dealer to sell the stock into a secondary market, which makes it more difficult for a purchaser to liquidate his or her investment. Any broker-dealer engaged by the purchaser for the purpose of selling his or her shares in Panex will be subject to rules 15g-1 through 15g-10 of the Exchange Act. Rather than creating a need to comply with those rules, some broker-dealers will refuse to attempt to sell penny stock.

The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, deliver a standardized risk disclosure document prepared by the SEC, which:

·	contains a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary trading;

·	contains a description of the broker’s or dealer’s duties to the customer and of the rights and remedies available to the customer with respect to a violation to such duties or other requirements;

·	contains a brief, clear, narrative description of a dealer market, including “ bid” and “ ask” prices for penny stocks and the significance of the spread between the bid and ask price;

·	contains a toll-free telephone number for inquiries on disciplinary actions;

·	defines significant terms in the disclosure document or in the conduct of trading penny stocks; and

·	contains such other information and is in such form (including language, type, size, and format) as the Commission shall require by rule or regulation.

·	The broker-dealer also must provide, prior to effecting any transaction in a penny stock, the customer:

o	with bid and offer quotations for the penny stock;

o	the compensation of the broker-dealer and its salesperson in the transaction;

o	the number of shares to which such bid and ask prices apply, or other comparable information relating to the depth and liquidity of the market for such stock; and

o	monthly account statements showing the market value of each penny stock held in the customer’s account.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from those rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written acknowledgment of the receipt of a risk disclosure statement, a written agreement to transactions involving penny stocks, and a signed and dated copy of a written suitability statement. These disclosure requirements will have the effect of reducing the trading activity in the secondary market for Panex’s stock because it will be subject to these penny stock rules. Therefore, stockholders may have difficulty selling those securities.

ITEM 6 – SELECTED FINANCIAL DATA

Panex is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required under this item.

ITEM 7 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with the Financial Statements and Notes to the Financial Statements filed with this Report.

Organization, Nature of Business, Going Concern and Management’s Plans

Panex Resources Inc. (‘Panex” or the “Company”) was incorporated in the State of Nevada on May 28, 2004. The Company is considered to be an Exploration Stage Company. The Company’s principal business is the acquisition and exploration of mineral resources.

Going concern and management’s plans:

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. Since its inception on May 28, 2004, the Company has not generated revenue and has incurred net losses. The Company incurred a net loss of $143,626 for the year ended August 31, 2013, and a deficit accumulated during the exploration stage of $13,613,055 for the period May 28, 2004 (inception) through August 31, 2013. Accordingly, it has not generated cash flow from operations and has primarily relied upon advances from shareholders and proceeds from equity financings to fund its operations. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

The Company has no mineral property interests as of the date of this report. Certain mineral property interests are presently being considered, however it is too early to determine whether they may be considered appropriate for acquisition.

During the next 12 months, management’s objective is to recapitalize Panex, continue to raise new capital and to seek new investment opportunities in the mineral sector. Management believes that its worldwide industry contacts will make it possible to identify and assess new projects for acquisition purposes.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

Results of Operations

Panex has generated no operating revenues since its inception on May 28, 2004 through August 31, 2013.

For the year ended August 31, 2013, Panex had net interest expense of $36, compared to $21,653 for the year ended August 31, 2012. Total expenses for the year ended August 31, 2013 were $341,335 compared to $914,790 for the year ended August 31, 2012. Expenses were lower in fiscal year 2013 than 2012 largely in consideration of more efficient capital and operational management. Furthermore during the quarter end May 31, 2013 management worked closely with various vendors to negotiate the extinguishment and settlement of liabilities for a total amount of $197,745.

Liquidity and Capital Resources

The financial statements have been prepared assuming the Company will continue as a going concern. Since inception in May 2004, the Company has not generated revenue and has incurred net losses. The Company has a working capital deficit of $336,468 as at August 31, 2013, incurred net losses of $143,626 for the fiscal year 2013 compared to $926,017 for the fiscal year 2012, and has a deficit accumulated during the exploration stage of $13,613,055 for the period from May 28, 2004 (inception) through August 31, 2013.

Accordingly, the Company has not generated cash flows from operations and have primarily relied upon loans from related and unrelated parties and equity financing to fund operations. These conditions (as indicated in the 2013 audit report of our Independent Registered Public Accounting Firm) raise substantial doubt about the Company’s ability to continue as a going concern.

During the year ended August 31, 2013, Panex used cash of $183,101 in operating activities compared to $369,692 for the year ended August 31, 2012. As previously noted, Panex is not generating revenues and accordingly has not generated any significant cash flow from operations. Panex is uncertain as to when it will produce cash flows from operations that are required to meet operating and capital requirements and will require significant funding from external sources to continue its operations.

During the year ended August 31, 2012 $560,000 cash was used to repay debt (nil for year ended August 31, 2013).

During April 2013, the Company entered into debt settlement agreements with creditors in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.005 per share. As a result, the Company extinguished certain liabilities as further set forth in the debt settlement agreements as follows:

-	Michel Muyiha, a creditor, for $75,000, for a total of 15,000,000 shares at a price of $0.005 per share.

-	Dr Georg Schnura, a creditor, for $175,758, for a total of 2,196,971 shares at a price of $0.08 per share.

-	Victor Dario, a creditor, for $80,000, for a total of 1,000,000 shares at a price of $0.08 per share.

In September 2012, November 2012 and June 2013 the Company received loan proceeds of $75,000, $25,000 and $10,000 respectively (totalling $110,000), from an unrelated third party. The loan is unsecured, and had no stated interest rate. $75,000 of these funds received was used to pay aged outstanding accounts payable in December 2012.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

Plan of Operation

Panex is also a “shell” company as defined by the SEC as a result of only having nominal operations and nominal assets.

Accounting and Audit Plan

Panex intends to continue to have Coresco AG, its outside consultant, assist in the preparation of Panex’s quarterly and annual financial statements and have these financial statements reviewed or audited by Panex’s independent registered public accounting firm. Coresco AG is expected to charge Panex approximately $3,000 to prepare Panex’s quarterly financial statements and approximately $6,000 to prepare Panex’s annual financial statements. Panex’s independent auditor is expected to charge approximately $4,000 to review each of Panex’s quarterly financial statements and approximately $12,500 to audit Panex’s annual financial statements. In the next 12 months, Panex anticipates incurring approximately $39,500 to pay for its accounting and audit requirements.

SEC Filing Plan

Panex expects to incur filing costs of approximately $5,000 per quarter to support its quarterly and annual filings. In the next 12 months, Panex anticipates spending approximately $20,000 for costs to pay for three quarterly filings and one annual filing.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

Critical Accounting Policies

Mineral Property and Exploration Costs

The Company has been in the exploration stage since its formation on May 28, 2004 and has not realized any revenues from its planned operations. It has been primarily engaged in the acquisition and exploration of mining properties. Mineral property acquisition and exploration costs are expensed as incurred. When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, the costs incurred to develop such property are capitalized. Such costs will be amortized using the units-of-production method over the estimated life of the probable reserve. If mineral properties are subsequently abandoned or impaired, any capitalized costs will be charged to operations.

Stock-Based Compensation

The Company accounts for share-based payments under the fair value method of accounting for stock-based compensation consistent with US GAAP. Under the fair value method, stock-based compensation cost is measured at the grant date based on the fair value of the award using the Black-Sholes option pricing model and is recognized to expense on a straight-line basis over the requisite service period, which is generally the vesting period. Where upon grant the options vest immediately the stock-based costs are expensed immediately.

Outlook

Material Contingencies and Commitments

Except for the related party management consulting agreements described in Note 4 to the financial statements, Panex has no contingencies or long-term commitments.

While Panex has raised capital to meet its working capital and financing needs in the past, additional financing is required in order to fully complete its plan of operation and launch its business operations. Panex is seeking financing in the form of equity in order to provide the necessary working capital. Panex currently has no commitments for financing. There are no assurances Panex will be completely successful in raising the funds required.

Off-Balance Sheet Arrangements

Panex has no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on Panex’s financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors, nor did Panex have any non-consolidated, special-purpose entities during this quarter.

Recent Accounting Pronouncements

Management has evaluated any recently issued accounting pronouncements to determine their applicability and does not believe that any of these pronouncements will have a significant impact on the Company’s financial statements.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

ITEM 7A – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Panex is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required under this item.

ITEM 8 – FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Panex’s financial statements are stated in United States Dollars (USD) and are prepared in accordance with accounting principles generally accepted in the United States of America. See Exhibit A – Financial Statements attached below.

ITEM 9 – CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Not applicable.

ITEM 9A – CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

In connection with the preparation of this annual report on Form 10-K, an evaluation was carried out by Panex’s management, with the participation of the Chief Executive Officer and the Chief Financial Officer, of the effectiveness of Panex’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (“ Exchange Act ”)) as of August 31, 2013. Disclosure controls and procedures are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC rules and forms and that such information is accumulated and communicated to management, including the Chief Executive Officer and the Chief Financial Officer, to allow timely decisions regarding required disclosures.

Based on that evaluation, Panex’s management concluded, as of the end of the period covered by this report, that Panex’s disclosure controls and procedures were not effective in recording, processing, summarizing, and reporting information required to be disclosed, within the time periods specified in the SEC rules and forms and that such information was not accumulated or communicated to management to allow timely decisions regarding required disclosure, for the reasons listed below in management’s report on internal control over financial reporting.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

Management’s Report on Internal Controls over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as required by Sarbanes-Oxley (SOX) Section 404A. Panex’s internal control over financial reporting is a process designed under the supervision of Panex’s Chief Executive Officer and Chief Financial Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of Panex’s financial statements for external purposes in accordance with U.S. generally accepted accounting principles. Internal control over financial reporting includes those policies and procedures that:

·	pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of Panex’s assets;

provide reasonable assurance that transactions are recorded as necessary to permit preparation of the financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures are being made only in accordance with authorizations of management and the Board of Directors; and

·	provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of Panex’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Management conducted an assessment of the effectiveness of the Company’s internal control over financial reporting as of August 31, 2013, based on criteria established in Internal Control –Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). As a result of this assessment, management identified material weaknesses in internal control over financial reporting.

A material weakness is a control deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of Panex’s annual or interim financial statements will not be prevented or detected on a timely basis.

The matters involving internal controls and procedures that management considered to be material weaknesses under the standards of the Public Company Accounting Oversight Board were: (1) lack of a functioning audit committee and lack of a majority of outside directors on Panex’s board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; (2) inadequate segregation of duties consistent with control objectives; (3) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements; and (4) ineffective controls over period end financial disclosure and reporting processes. The aforementioned material weaknesses were identified by Panex’s Chief Financial Officer and communicated to the board of directors.

As a result of the material weaknesses in internal control over financial reporting described above, management has concluded that, as of August 31, 2013, Panex’s internal control over financial reporting was not effective based on the criteria in Internal Control – Integrated Framework issued by COSO.

Management believes that the material weaknesses set forth above did not have an affect on Panex’s financial results.

Management also believes that the lack of a functioning audit committee and lack of a majority of outside directors on Panex’s board of directors caused and continues to cause an ineffective oversight in the establishment and monitoring of the required internal controls over financial reporting.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

Panex is committed to improving its financial organization. As part of this commitment and when funds are available, Panex will create a position within Panex’s accounting and finance team to segregate duties consistent with its control objectives and will increase its personnel resources and technical accounting expertise within the accounting function by: i) appointing one or more outside directors to its board of directors who will also be appointed to the audit committee of Panex resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls over financial reporting; and ii) preparing and implementing sufficient written policies and checklists that will set forth procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements.

Management believes that the appointment of one or more outside directors, who will also be appointed to a fully functioning audit committee, will remedy the lack of a functioning audit committee and a lack of a majority of outside directors on Panex’s Board. In addition, management believes that preparing and implementing sufficient written policies and checklists will remedy the following material weaknesses: (i) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements; and (ii) ineffective controls over period end financial close and reporting processes. Further, management believes that the hiring of additional personnel who have the technical expertise and knowledge will result proper segregation of duties and provide more checks and balances within the department. Additional personnel will also provide the cross training needed to support Panex if personnel turn-over issues within the department occur. This coupled with the appointment of additional outside directors will greatly decrease any control and procedure issues Panex may encounter in the future.

Management will continue to monitor and evaluate the effectiveness of Panex’s internal controls over financial reporting on an ongoing basis and is committed to taking further action and implementing additional enhancements or improvements, as necessary and as funds allow.

Panex’s independent registered public accounting firm has not issued an attestation report regarding Panex’s internal control over financial reporting. As a result, this annual report does not include such a report. Panex was not required to have, nor has Panex, engaged its independent registered public accounting firm to perform an audit of internal control over financial reporting pursuant to the rules of the Securities and Exchange Commission that permit Panex to provide only management’s report in this annual report.

Changes in Internal Controls over Financial Reporting

There were no changes in Panex’s internal controls over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) during the year ended August 31, 2013, that materially affected, or are reasonably likely to materially affect, Panex’s internal control over financial reporting.

ITEM 9B – OTHER INFORMATION

During the fourth quarter of the year covered by this Form 10-K, Panex had no information to be disclosed as required on a Form 8-K that was not previously disclosed.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

PART III

ITEM 10 – DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

a.	Identify Directors and Executive Officers

The directors named below will serve until the next annual meeting of the stockholders. Thereafter, directors will be elected for one-year terms at the annual stockholders' meeting. Officers will hold their positions at the discretion of the board of directors, absent any employment agreement, of which none currently exists or is contemplated. There is no arrangement or understanding between the directors and officers and any other person pursuant to which any director or officer was to be selected as a director or officer.

The names, addresses, ages and positions of Panex’s officers and directors that held their positions during or since the fiscal year ended August 31, 2013 are set forth below:

Name and Address	Age	Positions

Klaus Eckhof Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland	55	Chairman, Chief Executive Officer, Director

Ross Doyle Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland	41	Chief Financial Officer, Treasurer, Corporate Secretary

On March 26, 2012, Susmit Shah resigned as the Chief Financial Officer, Treasurer, and Corporate Secretary of Panex. Also, on March 26, 2012, Ross Doyle consented to and was appointed the Chief Financial Officer, Treasurer, and Corporate Secretary of Panex by the board of directors.

Klaus Eckhof (Dipl. Geol. TU, AusIMM): Mr Eckhof has been the Chairman of Panex since May 2006 and was appointed sole director and Chief Executive Officer on June 1, 2008. Mr Eckhof is a senior exploration geologist and a member of the Australian Institute of Mining and Metallurgy. Mr Eckhof has many global contacts and has been instrumental in sourcing and developing successful projects in Australia, Africa, Russia, South America and the Philippines.

Since 1994, Mr. Eckhof has managed his own geological consultancy company and has considerable experience in assessing and acquiring mineral prospects around the world. He was formerly President and Chief Executive Officer of Moto Goldmines Limited (“MGL”). Within 4 years from Mr Eckhof’s appointment, MGL discovered just under 20 million ounces of gold and completed a Bankable Feasibility Study at the Moto Gold Project in the Democratic Republic of Congo (DRC). Rangold Resources subsequently acquired MGL. He is currently a director of Carnavale Resources Ltd, Erongo Energy Limited and Burey Gold Ltd.

During the past three years, Mr Eckhof has also served as a director of the following listed companies: Condor Resources Plc. (September 1996-April 2011), African Metals Corporation (November 2005 to January 2011), and Aspire Mining Limited (formerly Windy Knob Resources Ltd) (April 2008 to September 2009).

Ross Doyle (CA, BCOM): Mr Doyle has been the Chief Financial Officer, Treasurer, and Corporate Secretary of Panex since March 2012. Mr Doyle is a Chartered Accountant with over 15 years experience as a strategic business analyst and CFO working with large commodity trading firms and financial institutions including working at the head office of Glencore International AG. Subsequent to departing Glencore, Mr. Doyle has advised other commodity firms in a similar capacity, before joining the board of Aurora Gold Corporation in October 2011, the CFO of Alphamin Resources in May 2012 and the CFO of Panex in March 2012.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

b.	Identify Significant Employees

Panex currently does not have any significant employees, with the exception of its officers.

c.	Family Relationships

There are no family relationships among the directors, executive officers or persons nominated or chosen by Panex to become directors or executive officers.

d.	Involvement in Certain Legal Proceedings

During the past ten years, none of Panex’s directors or officers has been:

·	a general partner or executive officer of any business against which any bankruptcy petition was filed, either at the time of the bankruptcy or two years prior to that time;

·	convicted in a criminal proceeding or named subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);

·	subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities;

subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity, or to be associated with persons engaged in any such activity;

·	found by a court of competent jurisdiction in a civil action or by the Commission to have violated any Federal or State securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended, or vacated;

found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any Federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated;

·	the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of:

·	any Federal or State securities or commodities law or regulation; or

·	any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or

·	any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or

the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization, any registered entity, or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

e.	Compliance with Section 16(a) of the Exchange Act

All reports were filed with the SEC on a timely basis and Panex is not aware of any failures to file a required report during the period covered by this annual report.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

f.	Nomination Procedure for Directors

Panex does not have a standing nominating committee; recommendations for candidates to stand for election as directors are made by the board of directors. Panex has not adopted a policy that permits shareholders to recommend candidates for election as directors or a process for shareholders to send communications to the board of directors.

g.	Audit Committee Financial Expert

Panex does not have a separately-designated standing audit committee. Mr Ross Doyle, Panex’s chief financial officer has skills and experience commensurate with an “audit committee financial expert”.

h.	Identification of Audit Committee

Panex does not have a separately designated standing audit committee. Rather, Panex’s board of directors performs the required functions of an audit committee. Panex’s board of directors is responsible for: (1) selection and oversight of Panex’s independent accountant; (2) establishing procedures for the receipt, retention and treatment of complaints regarding accounting, internal controls and auditing matters; (3) establishing procedures for the confidential, anonymous submission by Panex’s employees of concerns regarding accounting and auditing matters; (4) engaging outside advisors; and, (5) funding for the outside auditory and any outside advisors engagement by the audit committee.

i.	Code of Ethics

Panex has adopted a code of ethics that applies to all its executive officers and employees, including its CEO and CFO. See Exhibit 14.1 – Code of Ethics for more information. Panex undertakes to provide any person with a copy of its code of ethics free of charge. Please contact Mr Ross Doyle at +41 41 711 0281 to request a copy of Panex’s code of ethics. Management believes Panex’s code of ethics is reasonably designed to deter wrongdoing and promote honest and ethical conduct; provide full, fair, accurate, timely and understandable disclosure in public reports; comply with applicable laws; ensure prompt internal reporting of code violations; and provide accountability for adherence to the code.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

ITEM 11 – EXECUTIVE COMPENSATION

Panex has paid $145,286 and $329,492 in compensation to its named officers during its fiscal years ended August 31, 2013 and 2012, respectively.

SUMMARY COMPENSATION TABLE

Name and principal position	Year	Salary ($)	Bonus ($)	Stock Awards ($)	Option Awards ($)	Non-Equity Incentive Plan ($)	Non-qualified Deferred Compensation Earnings ($)	All other compensation ($)	Total ($)
Klaus Eckhof, Chairman, CEO, President^	2009 2010 2011 2012 2013	43,799 53,638 24,502 44,736 43,076	- - - - -	- - - - -	- - - 110,878 -	- - - - -	- - - - -	- - - - -	43,799 53,638 24,502 155,614 43,076
Ross Doyle CFO appointed March 26, 2012^	2012 2013	63,000 102,210	- -	- -	110,878 -	- -	- -	- -	173,878 102,210

^ Administration, accounting, SEC support, annual report preparation and lodgment, CFO and secretarial fees of $84,000 (2012: $42,000) was paid or payable to Coresco AG, a company in which Mr Eckhof and Mr Doyle has a beneficial interest.

Currently, there are no arrangements between Panex and any of its directors whereby such directors are compensated for any services provided as directors. There are no other employment agreements between Panex and any named executive officer, and there are no employment agreements or other compensating plans or arrangements with regard to any named executive officer which provide for specific compensation in the event of resignation, retirement, other termination of employment or from a change of control of Panex or from a change in a named executive officer’s responsibilities following a change in control.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

ITEM 12 – SECURITY OWNERSHIP OF CERTAIN BENEFICIAL HOLDERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following tables set forth, as of the date of this annual report, the total number of common shares owned beneficially by Panex’s director and officers, individually and as a group, and the present owners of 5% or more of Panex’s total outstanding common shares. The stockholders listed below have direct ownership of their shares and possess sole voting and dispositive power with respect to the shares.

Security Ownership of Certain Beneficial Owners (more than 5%)

Title of Class	Name and Address of Beneficial Owner	Amount and Nature of Beneficial Owner [1]	Percent of Class [2]
Shares of common stock	Michel Muhiya Faliaia Banque de Gestion Edmond de Rothschild 2 avenue de Monte-Carlo Monte-Carlo, 98000, Monaco	15,000,000	12.68%

[1] The listed beneficial owner has no right to acquire any shares within 60 days of the date of this Form 10-K from options, warrants, rights, conversion privileges or similar obligations excepted as otherwise noted.

[2] Based on 118,261,507 shares of common stock issued and outstanding as of October 5, 2013.

Security Ownership of Management

Title of Class	Name and Address of Beneficial Owner	Amount and Nature of Beneficial Owner [1]	Percent of Class [2]
Shares of common stock	Klaus Eckhof Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland	-	0.00%
Shares of common stock	Ross Doyle Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland	1,977,553	1.67%
Shares of common stock	Directors and Executive Officers (as a group)		1.67%

[2] Based on 118,261,507 shares of common stock issued and outstanding as of October 5, 2013.

Changes in Control

Panex is not aware of any arrangement that may result in a change in control of Panex.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

ITEM 13 – CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

a.	Relationships with Insiders

Since the beginning of Panex’s last fiscal year, no director, executive officer, security holder, or any immediate family of such director, executive officer, or security holder has had any direct or indirect material interest in any transaction or currently proposed transaction, which Panex was or is to be a participant, that exceeded the lesser of (1) $120,000 or (2) one percent of the average of Panex’s total assets at year-end for the last three completed fiscal years, except for the following:

Consultant Agreements

Klaus Eckhof and Ross Doyle are beneficial shareholders in Coresco AG (Coresco). Coresco charges $3,000 for office and facilities and administrative support and $7,000 for financial, management and statutory reporting, CFO and treasury functions, totaling to $10,000 per month. This agreement was entered on December 1, 2011, and can be terminated with 6 months notice subsequent to December 31, 2012.

b.	Transactions with Promoters

During the past five fiscal years, Klaus Eckhof has been a promoter of Panex’s business, but has not received anything of value from Panex nor is entitled to receive anything of value from Panex for services provided as a promoter of the business of Panex.

c.	Director Independence

Panex’s board of directors currently solely consists of Klaus Eckhof. Pursuant to Item 407(a)(1)(ii) of Regulation S-B of the Securities Act, Panex’s board of directors has adopted the definition of “independent director” as set forth in Rule 4200(a)(15) of the NASDAQ Manual. In summary, an “independent director” means a person other than an executive officer or employee of Panex or any other individual having a relationship which, in the opinion of Panex’s board of directors, would interfere with the exercise of independent judgement in carrying out the responsibilities of a director, and includes any director who accepted any compensation from Panex in excess of $200,000 during any period of 12 consecutive months within the three past fiscal years. Also, the ownership of Panex’s stock will not preclude a director from being independent.

In applying this definition, Panex’s board of directors has determined that Mr. Eckhof does not qualify as an “independent director” pursuant to the same Rule.

As of the date of the report, Panex did not maintain a separately designated compensation, nominating or audit committee. Panex has also adopted this definition for the independence of the members of its audit committee. Panex’s board of directors has determined that Mr. Eckhof is not “independent” for purposes of Rule 4200(a)(15) of the NASDAQ Manual, applicable to audit, compensation and nominating committee members, and is “independent” for purposes of Section 10A(m)(3) of the Securities Exchange Act.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

ITEM 14 – PRINCIPAL ACCOUNTING FEES AND SERVICES

a.	Audit Fees

The aggregate fees billed and expected to be billed for each of the last two fiscal years for professional services rendered by the principal accountant for Panex’s audit of its annual financial statements, reviews of its quarterly financial statements, or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years was:

2013 - $24,500 - GHP Horwath, P.C.

2012 - $33,800 - GHP Horwath, P.C.

b.	Audit–Related Fees

The aggregate fees billed in each of the last two fiscal years for audit related services by the principal accountants that are reasonably related to the performance of the audit or review of Panex’s financial statements and are not reported in the preceding paragraph:

2013 - $Nil - GHP Horwath, P.C.

2012 - $Nil - GHP Horwath, P.C.

Tax Fees

The aggregate fees billed in each of the last two fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning was:

2013 - $Nil - GHP Horwath, P.C.

2012 - $Nil - GHP Horwath, P.C.

d.	All Other Fees

The aggregate fees billed in each of the last two fiscal years for the products and services provided by the principle accountant, other than the services reported in paragraphs (a) and (b) was:

2013 - $Nil - GHP Horwath, P.C.

2012 - $Nil - GHP Horwath, P.C.

e.	Audit Committee

Panex does not have an Audit Committee. Therefore Panex’s Board of Director’s pre-approval policies and procedures described in paragraph (c)(7)(i) of Rule 2-01 of Regulation S-X were that the Board of Director’s pre-approve all accounting related activities prior to the performance of any services by any accountant or auditor.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

PART IV

ITEM 15 – EXHIBIT, FINANCIAL STATEMENT SCHEDULES

1.	Financial Statements

Audited financial statements of Panex Resources Inc. have been included in Item 8 above and Exhibit A attached.

2.	Financial Statement Schedules

All schedules for which provision is made in Regulation S-X are either not required to be included herein under the related instructions or are inapplicable or the related information is included in the footnotes to the applicable financial statement and, therefore, have been omitted from this Item 15.

Exhibits

All exhibits required to be filed with the Form 10-K are included in this annual report or incorporated by reference to Panex’s previous filings with the SEC, which can be found in their entirety at the SEC website at www.sec.gov under SEC File Number 333-130264 and SEC File Number 000-51707.

Exhibit	Description	Status
3.1	Articles of Incorporation of Panex Resources Inc. filed as an Exhibit to Panex’s Form SB-2 (Registration Statement) filed on December 12, 2005 and incorporated herein by reference.	Filed
3.2	By-Laws of Panex Resources Inc. filed as an Exhibit to Panex’s Form SB-2 (Registration Statement) filed on December 12, 2005 and incorporated herein by reference.	Filed
3.3	Certificate of Amendment of Panex Resources Inc., filed as an Exhibit to Panex’s Form 8-K (Current Report) filed on September 30, 2010 and incorporated herein by reference.	Filed
10.1	Management Agreement dated April 19, 2006 between Panex Resources Inc. and Reg Gillard, filed as Exhibit 10.2 to Panex’s Form 8-K (Current Report) filed on May 10, 2006 and incorporated herein by reference.	Filed
10.2	Letter of Understanding dated May 6, 2006 among Panex Resources Inc., Goldplata Corporation Limited, Goldplata Resources Inc, and Goldplata Resources, Sucursal-Columbia, filed as an Exhibit to Panex’s Form 8-K (Current Report) filed on May 25, 2006 and incorporated herein by reference.	Filed
10.3	Letter Agreement dated June 15, 2006 between Panex Resources Inc. and Emco Corporation, filed as an Exhibit to Panex’s Form 8-K (Current Report) filed on June 29, 2006 and incorporated herein by reference.	Filed
10.4	Share Sale Agreement dated July 10, 2006, between Panex Resources Inc. and Emco Corporation Inc. S.A., filed as an Exhibit to Panex’s Form 8-K (Current Report) filed on July 17, 2006, and incorporated herein by reference.	Filed
10.5	Heads of Agreement dated July 26, 2007 among Panex Resources Inc., Goldplata Resources Peru S.A.C., Goldplata Resources Inc., Goldplata Resources Sucursal-Colombia, Goldplata Corporation Limited, and Goldplata Mining International Corporation, filed as an Exhibit to Panex’s Form 10-K (Annual Report) filed on July 28, 2009 and incorporated herein by reference.	Filed
10.6	Letter Agreement dated December 6, 2007 among Panex Resources Inc., Emco Corporation Inc. S.A. and Minanca Minera Nanguipa, Compania Anonima, filed as an Exhibit to Panex’s Form 10-K (Annual Report) filed on July 28, 2009 and incorporated herein by reference.	Filed
10.7	Deed dated January 11, 2008 among Panex Resources Inc., Windy Knob Resources Limited, Goldplata Mining International Corporation, Goldplata Resources Inc., and Goldplata Resources Sucursal-Colombia, filed as an Exhibit to Panex’s Form 10-K (Annual Report) filed on July 28, 2009 and incorporated herein by reference.	Filed
14.1	Financial Code of Ethics filed as an Exhibit to Panex’s Form SB-2 (Registration Statement) filed on December 12, 2005 and incorporated herein by reference.	Filed
31.1	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 from chief executive officer.	Included
31.2	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 from chief financial officer.	Included
32	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	Included
99.1	Disclosure Committee Charter, filed as an Exhibit to Panex’s Form 10-K (Annual Report) filed on July 28, 2009 and incorporated herein by reference.	Filed
101 *	Financial statements from the quarterly reports on Form 10-Q of Panex Resources Inc. for the quarter ended May 31, 2013, 2012 and beyond are formatted in XBRL: (ii) the Balance Sheets, (ii) the Statements of Operations; (iii) the Statements of Cash Flows, and (iv) the Statements of Stockholders’ Equity (Deficit).	Included

* In accordance with Rule 406T of Regulation S-T, the XBRL (“eXtensible Business Reporting Language”) related information is furnished and not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.

Page - 25

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, Panex Resources Inc. has caused this report to be signed on its behalf by the undersigned duly authorized person.

PANEX RESOURCES INC.

/s/ Klaus Eckhof

Name: Klaus Eckhof

Title: President and CEO

Principal Executive Officer

November 1, 2013

/s/ Ross Doyle

Name: Ross Doyle

Title: CFO

Principal Financial Officer

November 1, 2013

Page - 26

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

EXHIBIT A

FINANCIAL STATEMENTS

Page - 27

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Panex Resources Inc. Board of Directors and Stockholders

We have audited the accompanying balance sheets of Panex Resources Inc. (an Exploration Stage Company) as of August 31, 2013 and 2012, and the related statements of operations, cash flows and stockholders’ equity (deficiency) for each of the years then ended, and for the period from May 28, 2004 (inception) through August 31, 2013. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Panex Resources Inc. as of August 31, 2013 and 2012, and the results of its operations and cash flows for each of the years then ended, and for the period from May 28, 2004 (inception) through August 31, 2013, in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company incurred a net loss of $143,626 for the year ended August 31, 2013, and a deficit accumulated during the exploration stage of $13,613,055 for the period from May 28, 2004 (inception) through August 31, 2013. The Company also has a limited history and no revenue producing operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. Management's plans with regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ GHP HORWATH, P.C.

Denver, Colorado

November 1, 2013

Page - 28

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

BALANCE SHEETS

PANEX RESOURCES INC.	As at			As at
(An exploration stage enterprise)	August 31			August 31
Balance Sheets	2013			2012
(Expressed in U.S. Dollars)	$			$

ASSETS
Current assets
Cash		519			65,799
Total current assets		519			65,799
Total assets (all current)		519			65,799

Liabilities and Stockholders' Equity (Deficiency)
Current liabilities
Accounts payable and accrued expenses		63,344			302,047
Accounts payable and accrued expenses related parties (Note 4(b))		163,643			31,594
Accrued liabilities, other		-			-
Loans and borrowings, related party		-			-
Loans and borrowings		110,000			-
Deposits for common stock subscriptions		-			-
Total liabilities (all current)		336,987			333,641
Stockholders’ Equity (Deficiency)
Common stock
Authorized: 500,000,000 (2012: 500,000,000)
common shares with par value of $0.001 each
Issued and outstanding:
118,261,507 (2012: 103,261,507) common shares		118,261			103,261
Additional paid-in capital		13,080,699			13,020,699
Donated capital		77,627			77,627
Advances for subscriptions		-			-
Accumulated deficit during the exploration stage		(13,613,055	)		(13,469,429	)
Stockholder’ equity (deficiency)		(336,468	)		(267,842	)
Total liabilities and stockholders’ equity (deficiency)		519			65,799

The accompanying notes are an integral part of these financial statements.

Page - 29

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

STATEMENTS OF OPERATIONS

PANEX RESOURCES INC.	Cumulative			For the			For the
(An exploration stage enterprise)	May 28, 2004			Year			Year
Statements of Operations	(inception)			Ended			Ended
	to August 31			August 31			August 31
(Unaudited)	2013			2013			2012
(Expressed in U.S. Dollars)	$			$			$
Donated rent		5,250			-			-
Donated services		72,377			-			30,260
Listing and filing fees		2,396			2,396			-
Investor relation expenses		-			-			-
Directors fees		-			-			-
Management fees		783,254			61,431			44,736
Stock option compensation		221,756			-			221,756
Professional fees		1,437,890			112,762			291,244
Travel costs		335,415			-			-
General and administrative		596,430			163,709			339,875
Foreign currency transaction loss (gain)		104,595			1,037			(13,082	)
Mineral property and exploration costs		4,739,777			-			-
Write-off deferred acquisition cost		400,000			-			-
Provision against Minanca loan		6,100,000			-			-
		14,799,140			341,335			914,789
Other income (expense)
Interest income		42,707			-			10,426
Interest expense		(304,413	)		(36	)		(21,653	)
Loss on sale of investment		(126,182	)		-			-
Extinguishment of liabilities		197,745			197,745			-
Gain on sale of mineral property right		1,376,228			-			-
		1,186,085			197,709			(11,227	)
(Net Loss) / Income		(13,613,055	)		(143,626	)		(926,016	)
Net Loss Per Share – Basic and Diluted					*			*
Weighted Average Shares Outstanding					109,097,123			90,045,259

* Amount is less than $0.01 per share

The accompanying notes are an integral part of these financial statements.

Page - 30

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

STATEMENTS OF CASH FLOWS

PANEX RESOURCES INC.	Cumulative			For the			For the
(An exploration stage enterprise)	May 28, 2004			Year			Year
Statements of Cash Flows	(inception)			Ended			Ended
	to August 31			August 31			August 31
(Unaudited)	2013			2013			2012
(Expressed in U.S. Dollars)	$			$			$
Cash Flows From Operating Activities
(Net loss) income		(13,613,055	)		(143,626	)		(926,016	)
Adjustments to reconcile net loss to cash used in operating activities
Foreign currency transaction loss (gain)		104,589			1,031			(13,082	)
Gain on sale of mineral property rights		(586,228	)		-			-
Loss on sale of investment		126,181			-			-
Gain on extinguishment of liabilities		(208,171	)		(197,745	)		(10,426
Donated services and expenses		77,627			-			30,260
Expenses paid by issue of common stock		500			-			-
Options expense		221,756			-			221,756-
Write-off deferred acquisition costs		400,000			-			-
Provision against Minanca loan		6,100,000			-			-
Change in operating assets and liabilities					-			-
Increase (decrease) in receivables and other assets					-			-
Increase (decrease) in accounts payable and accrued liabilities		1,071,470			25,190			536,223
Increase (decrease) in amounts due to related parties		294,159			132,049			(208.407	)
Net Cash Used in Operating Activities		(6,011,172	)		(183,101	)		(369.692	)
Cash Flows From Investing Activities
Cash received from sale of investment		250,047			-			-
Cash received from sale of mineral property rights		210,000			-			-
Deferred acquisition costs		(400,000	)		-			-
Loan advances		(7,100,000	)		-			-
Repayment of loan advance		1,000,000			-			-
Net Cash Used in Investing Activities		(6,039,953	)		-			-
Cash Flows From Financing Activities
Loan from related parties		594,313			-			-
Loan repaid to related parties		(576,483	)		-			-
Loan from (repaid to) unrelated third parties		340,000			110,000			(560,000	)
Deposits received for common shares to be issued		40,000			-			-
Common shares issued for cash		11,647,739			-			978,989
Net Cash Provided by Financing Activities		12,045,569			110,000			418,989
Effect of Exchange Rates on Cash		6,075			7,821			(2,855	)
Increase (decrease) in Cash		519			(65,280	)		46,442
Cash at Beginning of Period		-			65,799			19,357
Cash at End of Period		519			519			65,799

The accompanying notes are an integral part of these financial statements.

Page - 31

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

STATEMENTS OF STOCKHOLDER’S EQUITY (DEFICIENCY)

PANEX RESOURCES INC (An exploration stage enterprise) Statements of Stockholder's Equity (Deficiency) and Comprehensive income (Loss)	Common Stock						Additional paid-in capital			Donated Capital		Accumulated (deficit) during exploration stage			Total stockholders' equity (deficiency)
May 28, 2004 (inception) to Balance Date	Shares Amount						$			$		$			$
(Expressed in U.S. Dollars)	#			$
BY QUARTER MOVEMENT
Balances, May 28, 2004 (Date of inception)
Common stock issued for services to president		6,000,000			6,000			(5,500	)		-		-			500
Return and cancellation of shares		(6,000,000	)		(6,000	)		6,000			-		-			-
Net loss													(500	)		(500	)
Balances, August 31, 2004		-			-			500			-		(500	)		-
Common stock issued for cash		64,500,000			64,500			(17,750	)		-		-			46,750
Return and cancellation of shares		(30,000,000	)		(30,000	)		30,000			-		-			-
Donated rent		-			-			-			3,000		-			3,000
Donated services		-			-			-			6,000		-			6,000
Net loss													(15,769	)		(15,769	)
Balances, August 31, 2005		34,500,000			34,500			12,750			9,000		(16,269	)		39,981
Common stock issued for cash		1,964,285			1,964			4,498,036			-		-			4,500,000
Donated rent		-			-			-			2,250		-			2,250
Donated services		-			-			-			4,500		-			4,500
Net loss													(848,560	)		(848,560	)
Balances, August 31, 2006		36,464,285			36,464			4,510,786			15,750		(864,829	)		3,698,171
Common stock issued for cash		7,632,500			7,632			6,098,368								6,106,000
Net loss													(10,943,990	)		(10,943,990	)
Balances, August 31, 2007		44,096,785			44,096			10,609,154			15,750		(11,808,819	)		(1,139,819	)
Net loss													(66,651	)		(66,651	)
Balances, August 31, 2008		44,096,785			44,096			10,609,154			15,750		(11,875,470	)		(1,206,470	)
Common stock issued for cash		1,600,000			1,600			14,400								16,000
Common stock issued for settlement of debt		14,000,000			14,000			126,000								140,000
Shares to be issued		-			-			30,000								30,000
Net loss													(154,585	)		(154,585	)
Balances, August 31, 2009		59,696,785			59,696			10,779,554			15,750		(12,030,055	)		(1,175,055	)
Common stock issued for cash received in		4,000,000			4,000			6,000			-		-			10,000
December 2008																-
Common stock issued for settlement of debt		3,350,000			3,350			30,150			-		-			33,500
Net loss													(213,860	)		(213,860	)
Balances, August 31, 2010		67,046,785			67,046			10,815,704			15,750		(12,243,915	)		(1,345,415	)
Common stock issued for settlement of accounts		12,303,123			12,303			602,853			-		-			615,156
payable, accrued liabilities and debt																-
Donated services		-			-			-			31,617		-			31,617
Net loss													(299,498	)		(299,498	)
Balances, August 31, 2011		79,349,908			79,349			11,418,557			47,367		(12,543,413	)		(998,140	)
Donated services		-			-			-			30,260		-			30,260
Issuance of common stock for settlement of debt and accounts payable in February 2012)																-
		8,477,553			8,478			161,073			-		-			169,551
Common stock issued for cash at $0.08 per share		12,237,075			12,237			966,752			-		-			978,989
Common stock issued for settlement of debt and accounts payable in March 2012		3,196,971			3,197			252,561			-		-			255,758
Stock option compensation expense		-			-			221,756			-		-			221,756
Net loss		-			-			-			-		(926,016	)		(926,016	)
Balances, August 31, 2012		103,261,507			103,261			13,020,699			77,627		(13,469,429	)		(267,842	)
Net loss		-			-			-			-		(143,626	)		(143,626	)
Common stock issued for settlement of liabilities on April 11, 2013 at 0.5 cents per share		15,000,000			15,000			60,000			-		-			75,000
Balances, August 31, 2013		118,261,507			118,261			13,080,699			77,627		(13,613,055	)		(336,468	)

The accompanying notes are an integral part of these financial statements.

Page - 32

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

NOTES TO FINANCIAL STATEMENTS

1.	Organization, Nature of Business, Going Concern and Management’s Plans

Going concern and management’s plans:

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. Since its inception on May 28, 2004, the Company has not generated revenue and has incurred net losses. The Company incurred a net loss of $143,066 for the year ended August 31, 2013, and a deficit accumulated during the exploration stage of $13,613,055 for the period May 28, 2004 (inception) through August 31, 2013. Accordingly, it has not generated cash flow from operations and has primarily relied upon advances from shareholders and proceeds from equity financings to fund its operations. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

2.	Summary of Significant Accounting Policies

a.	Basis of Preparation

These financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States (US GAAP). The Company’s fiscal year-end is August 31.

Page - 33

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

2.	Summary of Significant Accounting Policies (Continued)

b.	Use of Estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

c.	Basic and Diluted Net Income (Loss) Per Share

Earnings (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the reporting period including common stock issued effective the date committed. Common stock issuable is considered outstanding as of the original approval date for the purposes of earnings per share computations. Diluted earnings (loss) per common share is computed by dividing net earnings (loss) by the sum of (a) the basic weighted average number of shares of common stock outstanding during the period and (b) additional shares that would have been issued and potentially dilutive securities. During the reporting periods the diluted earnings (loss) per share was equivalent to the basic earnings (loss) per share because all potentially dilutive securities were anti-dilutive due to the net losses incurred. Potentially dilutive securities consist of stock options outstanding at the end of the reporting period.

Cash

Cash includes deposits in banks, which are unrestricted as to withdrawal or use.

e.	Mineral Property and Exploration Costs

f.	Deferred Acquisition Costs

The Company capitalizes deposits paid during the acquisition of equity interests as deferred acquisition costs. Deferred acquisition costs are recorded at cost and are included in the purchase price of the equity interest once the acquisition has been consummated.

g.	Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date in the principal or most advantageous market. The Company uses a fair value hierarchy that has three levels of inputs, both observable and unobservable, with use of the lowest possible level of input to determine fair value.

Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2 - observable inputs other than Level 1, quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, and model-derived prices whose inputs are observable or whose significant value drivers are observable; and

Level 3 - assets and liabilities whose significant value drivers are unobservable.

Page - 34

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

2.	Summary of Significant Accounting Policies (Continued)

As of reporting period, the Company did not have any assets or liabilities that were measured at fair value on a recurring or non-recurring basis.

Observable inputs are based on market data obtained from independent sources, while unobservable inputs are based on the Company’s market assumptions. Unobservable inputs require significant management judgment or estimation. In some cases, the inputs used to measure an asset or liability may fall into different levels of the fair value hierarchy. In those instances, the fair value measurement is required to be classified using the lowest level of input that is significant to the fair value measurement. Such determination requires significant management judgment.

Financial instruments, which include cash, accounts payable, and loans and borrowings, were estimated to approximate their carrying values due to the immediate or short-term maturity of these financial instruments. The fair value of amounts due to related parties are not practical to estimate, due to the related party nature of the underlying transactions. The financial risk to the Company’s operations arises from fluctuations in foreign exchange rates and the degree of volatility of these rates. Currently, the Company does not use derivative instruments to reduce its exposure to foreign currency risk.

h.	Income Taxes

The Company recognizes deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their tax bases, as well as net operating losses.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets or liabilities of a change in tax rates is recognized in the period in which the tax change occurs. A valuation allowance is provided to reduce the deferred tax assets to a level, that more likely than not, will be realized.

Management does not believe that the Company has any unrecognized tax positions. The Company’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense.

i.	Stock-Based Compensation

j.	Foreign Currency Translation and Transactions

The Company’s functional and reporting currency is the United States dollar. Monetary assets and liabilities denominated in foreign currencies are translated into the United States dollar using the exchange rate prevailing at the balance sheet date. Gains and losses arising on settlement of foreign currency denominated transactions or balances are included in the determination of income.

k.	Concentration of Credit Risk

The Company’s financial instruments that are exposed to concentration of credit risk consist of cash. The Company’s cash is in demand deposit accounts placed with federally insured financial institutions in Canada.

l.	Recent Accounting Pronouncements

Page - 35

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

3.	Stock Options

In August 2012, the Company's Board of Directors approved the issuance of stock options as an incentive to obtain services of key employees, directors and consultants of the Company. The following is a summary of stock option activity and the status of stock options outstanding and exercisable at August 31, 2013:

	Stock Options #			Weighted Average Exercise Price $		Remaining Contractual Life (years) As At		Aggregate Intrinsic value As At
Outstanding and exercisable at August 31, 2011		-			-		-		-
Granted on August 3, 2012		8,000,000			0.08		4.92		-
Outstanding and exercisable at August, 31, 2012		8,000,000			0.08		4.92		-
Granted during the fiscal year ended August 31, 2013		-			-		-		-
Forfeited during the fiscal year ended August 31, 2013		(8,000,000	)		0.08		4.17		-
Outstanding and exercisable at August 31, 2013		-			-		-		-

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value for all “in-the-money” options (i.e. the difference between the Company’s closing stock price on the last trading day of the fiscal year and the exercise price, multiplied by the number of shares) that would have been received by the option holders had all option holders exercised their options.

Effective August 3, 2012, the Company’s board of directors granted 8,000,000 stock purchase options. Each of the options has an issue date, effective date and vesting date of August 3, 2012, with an exercise price of $0.08 per share. The term of these options is five years. The options are exercisable at any time from the grant date up to and including August 2, 2017. All related compensation expense was recognized on August 31, 2012 as the options were vested in full on that date.

On June 20, 2013, Panex reached an agreement with Klaus Eckhof and Ross Doyle to cancel all of their outstanding stock options with Panex. As a result of the cancellation of the 8,000,000 stock options, Panex currently has no outstanding stock options as at August 31, 2013. The Company previously expensed all compensation related to the stock options; accordingly the cancellation had no impact on earnings.

Page - 36

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

4.	Related Party Transactions

a.	There were no donated services provided by the president of the Company during the fiscal year ended August 31, 2013 (August 31, 2012: $30,260).

b.	The Company incurred management fees provided by the CEO during the fiscal year ended August 31, 2013 including $43,076 to the CEO (August 31, 2012: $44,736).

Included in general and administrative fees during the fiscal year ended August 31, 2013 were $172,016 (including $43,076 of management fees) for CFO, Administration, Company Secretarial, Office Services and Support fees recognized for services performed by Coresco AG (August 31, 2012: $192,765) related through common ownership including the amount paid to the Chief Financial Officer.

d.	Included in general and administrative fees during the fiscal year ended August 31, 2013 were $5,546 for Geographical Information Service fees recognized for services performed by Coresco AG (August 31, 2012: $nil).

e.	As of August 31, 2013, the Company has an accrued liability of $163,643 due to these related parties (August 31, 2012 $31,594 for management and travel expenses due to the president of the Company for Coresco AG professional fees for fund raising, corporate office and management activities)

f.	On June 20, 2013, Panex reached an agreement with Klaus Eckhof and Ross Doyle to cancel all of their outstanding stock options with Panex. As a result of the cancellation of the 8 million stock options, Panex currently has no outstanding stock options as at August 31, 2013.

5.	Loans and Borrowings

In March and July 2007, the Company received loan proceeds of $240,000 and $500,000 respectively from an unrelated third party. These loans were unsecured bearing interest at 8% per annum, with no fixed repayment date, but the understanding with the lender was that the loans will be repaid from the proceeds of future equity financings and/or the repayment of amounts lent to Minanca. On December 20, 2010, principal of $46,892 and interest of $15,751 was assigned to this third party. In December 2010, $267,072 of this loan as well as $200,310 of accrued interest on this loan was settled by the issue of 9,347,640 shares. In May 31, 2012 this loan was settled in full for $560,000, resulting in a gain on extinguishment of $10,426, which is included within interest income and other for the year ended August 31, 2012.

In January 2011, the Company received loan proceeds of $50,000, from an unrelated third party. This loan was unsecured, and had no stated interest rate. This amount was settled for issuance of 2,500,000 shares of common stock in February 2012.

6.	Material Contingencies and Commitments

Panex has no material contingencies or long-term commitments.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

7.	Stockholders’ Equity

Common Stock

Panex’s authorized capital stock consists of 500,000,000 shares of common stock at a par value of $0.001 per share.

Stock cancellations and recapitalization:

On May 25, 2006 and June 9, 2006, the Company completed the return and cancellation of 30,000,000 and 6,000,000 common shares to the treasury, respectively. The shares were returned by the former president of the Company.

The net loss per share amounts and stockholders’ equity (deficit) have been retroactively restated (accounted for as a recapitalization) to reflect the return and cancellation of 36,000,000 common shares by the former president of the Company.

Common stock issuances

On May 28, 2004, the Company issued 6,000,000 shares of common stock to the then President of the Company for reimbursement of legal expenses of $500 incurred on behalf of the Company.

On June 30, 2005, the Company issued 6,000,000 shares of common stock for cash proceeds of $25,000.

On April 15, 2005, the Company issued 22,500,000 shares of common stock for cash proceeds of $18,750.

On March 22, 2005 the Company issued 36,000,000 shares of common stock for cash proceeds of $3,000.

On June 8, 2006, the Company completed a private placement with a director of the Company for 714,285 common shares at a price of $2.80 per share for proceeds of $2,000,000.

On August 30, 2006, the Company completed a private placement of 1,250,000 units at a price of $2.00 per unit for proceeds of $2,500,000. Each unit consisted of one common share and one common share purchase warrant.

Each share purchase warrant entitles the holder to acquire one additional common share at an exercise price of $2.50 per share for a period of two years. All warrants expired unexercised on August 31, 2008.

During November 2006, the Company completed private placements for 3,095,000 shares of restricted common stock at $0.80 per share, raising proceeds of $2,476,000.

In January 2007 the Company completed two private placements for 3,187,500 shares of restricted common stock at $0.80 per share raising proceeds of $2,550,000.

In February 2007 the Company completed two private placements for 1,350,000 shares of restricted common stock at $0.80 per share raising proceeds of $1,080,000.

On February 28, 2009, the board of directors authorized the issuance of 14,100,000 restricted shares of common stock at a subscription price of $0.01 per restricted share, for cash proceeds of $16,000 and the settlement of $125,000 accrued liabilities and debt. The shares were issued on June 19, 2009.

On May 29, 2009, the Company completed a private placement for 1,500,000 shares of restricted common stock at price of $0.01 per restricted share in exchange for the settlement of $15,000 debt.

In October 2009, the Company issued 6,350,000 restricted shares of common stock at a subscription price of $0.01 per restricted share, for cash proceeds of $40,000 and the settlement of $23,500 in accrued liabilities and debt due to a related party. The cash was received in December 2008.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

7.	Stockholders’ Equity (Continued)

In January 2010, the Company issued 1,000,000 restricted shares of common stock at a subscription price of $0.01 per restricted share, for the settlement of $10,000 in accrued liabilities and debt due to a related party.

On December 20, 2010, the Company issued 2,955,483 restricted shares of common stock at a subscription price of $0.05 per share, for the settlement of $147,774 in accounts payable and accrued liabilities and issued 9,347,640 restricted shares of common stock at a subscription price of $0.05 per share for the settlement of loans and accrued interest totaling $467,382 from an unrelated third party.

Effective August 3, 2012, the Company’s board of directors granted 8,000,000 stock purchase options. Each of the options has an issue date, effective date and vesting date of August 3, 2012, with an exercise price of $0.08 per share. The term of these Options are five years. The Options are exercisable at any time from the grant date up to and including August 2, 2017.

On April 11, 2013, the Company issued 15,000,000 restricted shares of common stock at a subscription price of $0.005 per share, for the settlement of $75,000 in accounts payable and accrued liabilities.

Financing Activities:

-	Michel Muyiha, a creditor, for $75,000, for a total of 15,000,000 shares at a price of $0.005 per share.

During March 2012, the Company entered into debt settlement agreements with creditors in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.08 per share. As a result, the Company extinguished certain liabilities as further set forth in the debt settlement agreements as follows:

-	Dr Georg Schnura, a creditor, for $175,758, for a total of 2,196,971 shares at a price of $0.08 per share.

-	Victor Dario, a creditor, for $80,000, for a total of 1,000,000 shares at a price of $0.08 per share.

On February 24, 2012, the Company entered into debt settlement agreements with creditors and related parties in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.02 per share. As a result, the Company extinguished certain liabilities as further set forth in the debt settlement agreements as follows:

-	Ross Doyle, a related party for $ 39,551, for a total of 1,977,553 shares at a price of $0.02 per share.

-	Werte AG, a creditor, for $80,000, for a total of 4,000,000 shares at a price of $0.02 per share.

-	Lars Pearl, a creditor, for $50,000, for a total of 2,500,000 shares at a price of $0.02 per share.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 2013

8.	Income Taxes

The components of the Company’s net deferred tax asset as of August 31, 2013 and 2012, rate and the valuation allowance are as follows:

	2013			2012
Net operating losses		7,291,299			7,147,673
Loan loss reserves		6,100,000			6,100,000
		13,391,299			13,247,673
Statutory tax rate		35	%		35	%
Deferred tax asset		4,686,955			4,636,685
Valuation allowance		(4,686,955	)		(4,636,685	)
Net deferred tax asset		-			-

The Company has net operating loss carry-forwards for tax purposes of approximately $7,291,299, which begin expiring in 2031. The utilization of the net operating loss carry-forwards cannot be assured.

Deferred income tax reflects the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The Company provided a valuation allowance of 100% of its net deferred tax asset due to the uncertainty of generating future profits that would allow for the realization of such deferred tax assets

9.	Subsequent Events

On October 22, 2013 the Company announced that it has signed a Memorandum of Understanding (MOU) with Amani Consulting SPRL currently in Joint Venture with state entity La Société Minière de Kilo Moto (Sokimo) to acquire a 55% interest in Giro Goldfields SPRL (Giro). Amani has a 65% interest and Sokimo has a 35% free carried interest in Giro which is comprised of two exploitation permits, covering a surface area of 610sqkm. The permits lie within 20–30km west of Randgold/Ashanti’s 20Moz Kibali gold deposits. Under the MOU, the acquisition terms are summarized as follows:

- Two months after the successful conclusion of the due diligence (commencement date), the Company will make a payment of $100,000 to the current shareholders of Amani. Six months after the commencement date Panex will pay a further $300,000 to the current shareholders of Amani. The Company intends to raise capital via the issuance of approximately 500,000,000 shares at $0.001 cents per share.

- On signing of a Share Purchase Agreement, Panex will issue 55% of the share capital in Panex to current partners of Amani.

- Should the Company identify 3moz (measured and indicated) gold resources at a cut off grade of 2.5g/t, the Company will pay a further $5,350,000 to the current shareholders in Amani.

- On successful completion of the due diligence, the Company will fund a defined drilling programme to test the mineralised potential on the two main target areas mined previously by the Belgians on the Giro Project.

- The Company may at its discretion withdraw from this agreement by written notice to Amani at any time without penalty.

Otherwise than as disclosed above and within the financial statements there are no subsequent events.

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Panex Resources Inc. - FORM 10-K - November 1, 2013

Attached files

Panex Resources Inc. Reports