UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549





———————


FORM
10-K


———————





x
            ANNUAL
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGEACT
      OF 1934For
      the fiscal year ended: December 31, 2007oro
            TRANSITION
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGEACT
      OF 1934For
      the transition period from: _____________ to
  _____________





Commission File
Number   000-32551





LEGEND
INTERNATIONAL HOLDINGS, INC.


(Exact
name of registrant as specified in its charter)





———————





Delaware
            
            23-3067904(State
      or Other Jurisdiction
            
            (I.R.S.
      Employerof
      Incorporation or Organization)
            
            Identification
      No.)







Level
8, 580 St Kilda Road Melbourne, Victoria, 3004, Australia


(Address
of Principal Executive Office) (Zip Code)




011
(613) 8532 2866


(Registrant’s
telephone number, including area code)




N/A


(Former
name or former address, if changed since last report)


———————


Securities
      registered pursuant to Section 12(b) of the Act: NoneSecurities
      registered pursuant to Section 12(g) of the Act:Title
      of each classCommon
      Stock, par value $.001 per share





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




o 
      Yes
                
                x 
       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.


o 
      Yes
              
              x 
       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 preceding 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.
 x 
      Yes
              
              o  No




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.
  o
  Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company.
  Large
      accelerated filer
                  o
                  
                  Accelerated
      filer
                  xNon-accelerated
      filer
                  o
                  
                  Smaller
      reporting company
                  o




Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act).
 o 
      Yes
                    
                    x 
       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
last 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.
 
 The
aggregate market value based on the average bid and asked price on the
over-the-counter market of the Registrant’s common stock, (“Common Stock”) held
by non-affiliates of the Company was US$116,740,124 as at December 31,
2007.
 
 There were
177,068,825 outstanding shares of Common Stock as of March 12, 2008
 
 APPLICABLE
ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
 PROCEEDINGS
DURING THE PRECEDING FIVE YEARS:
 
 Indicate
by check mark whether the registrant has filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act
of 1934 subsequent to the distribution of securities under a plan confirmed by a
court.
  o 
      Yes
                            
                            o   No




DOCUMENTS
INCORPORATED BY REFERENCE
 
 Not
Applicable
 
 
  INDEX
  PART IItem 1.
                  Business.
                  
                  
                  1Item 1A.
                  Risk Factors.
                  
                  
                  19Item 1B.
                  Unresolved Staff Comments.
                  
                  
                  23Item 2.
                  Properties.
                  
                  
                  23Item 3.
                  Legal Proceedings.
                  
                  
                  23Item 4.
                  Submission of Matters to a Vote of Security
      Holders.
                  
                  
                  23PART IIItem 5.
                  Market for Registrant's Common Equity, Related Stockholder
      Matters andIssuer Purchases of Equity Securities.
                  
                  
                  24Item 6.
                  Selected Financial Data.
                  
                  
                  27Item 7.
                  Management's Discussion and Analysis of Financial Condition
      and Results of Operation.
                  
                  
                  28Item 7A.
                  Quantitative and Qualitative Disclosures About Market
      Risk.
                  
                  
                  31Item 8.
                  Financial Statements and Supplementary
    Data.
                  
                  
                  31Item 9.
                  Changes in and Disagreements With Accountants on Accounting
      and Financial Disclosure.
                  
                  
                  32Item 9A.
                  Controls and Procedures.
                  
                  
                  32Item 9B.
                  Other Information.
                  
                  
                  32PART IIIItem 10.
                  Directors, Executive Officers and Corporate
      Governance.
                  
                  
                  33Item 11.
                  Executive Compensation.
                  
                  
                  35Item 12.
                  Security Ownership of Certain Beneficial Owners and
      Management andRelated Stockholder Matters.
                  
                  
                  37Item 13.
                  Certain Relationships and Related Transactions, and
      Director Independence.
                  
                  
                  39Item 14.
                  Principal Accounting Fees and Services.
                  
                  
                  41PART IVItem 15.
                  Exhibits, Financial Statement
Schedules.
                  
                  
                  42SIGNATURES
                  
                  
                  
                  43
  EXPLANATORY
NOTE
 The
Company was previously a smaller reporting company that determined that it no
longer qualified as such as of its June 30, 2007 determination
date.  In accordance with SEC Release 33-8876, the Company has elected
to comply with the disclosure requirements for a smaller reporting company in
connection with the preparation of this Annual Report on Form 10-K.
  i
  PART I
    Item 1.
                  Business.
 
 General
 
 The
terms “Legend,” “Company,” “we,” “our,” and “us” refer to Legend International
Holdings, Inc. unless the context suggests otherwise.
 
 This
report and other reports, as well as other written and oral statements made or
released by us, may contain forward looking statements. Forward looking
statements are statements that describe, or that are based on, our current
expectations, estimates, projections and beliefs. Forward looking statements are
based on assumptions made by us, and on information currently available to us.
Forward-looking statements describe our expectations today of what we believe is
most likely to occur or may be reasonably achievable in the future, but such
statements do not predict or assure any future occurrence and may turn out to be
wrong. You can identify forward-looking statements by the fact that they do not
relate strictly to historical or current facts. The words "believe,"
"anticipate," "intend," "expect," "estimate," "project", "predict", "hope",
"should", "may", and "will", other words and expressions that have similar
meanings, and variations of such words and expressions, among others, usually
are intended to help identify forward-looking statements.
 
 Forward-looking
statements are subject to both known and unknown risks and uncertainties and can
be affected by inaccurate assumptions we might make.  Risks,
uncertainties and inaccurate assumptions could cause actual results to differ
materially from historical results or those currently
anticipated.  Consequently, no forward-looking statement can be
guaranteed.  The potential risks and uncertainties that could affect
forward looking statements include, but are not limited to the risks of mineral
exploration and development stage projects, political risks of development in
foreign countries, risks associated with environmental and other regulatory
matters, mining risks and competitors, the volatility of phosphate, diamond and
other mineral prices and movements in foreign exchange rates, increased
competition, governmental regulation, performance of information systems, and
the ability of the Company to hire, train and retain qualified
employees.  In addition, other risks, uncertainties, assumptions, and
factors that could affect the Company's results and prospects are described in
this report, including under the heading “Risk Factors” and elsewhere and may
further be described in the Company's prior and future filings with the
Securities and Exchange Commission and other written and oral statements made or
released by the Company.
 
 We caution
you not to place undue reliance on any forward-looking statements, which speak
only as of the date of this document.  The information contained in
this report is current only as of its date, and we assume no obligation to
update any forward-looking statements.
 
 Legend has
a 100% owned subsidiary company Legend Consolidated Group Inc, a Delaware
corporation. This company is inactive.
 
 Effective
November 17, 2006, Legend issued one (1) new bonus share of Common Stock for
every two (2) shares of Common Stock outstanding on the record at that date. The
issue of the new bonus shares of Common Stock were on a pro-rate basis to all
shareholders. As a result, the Company issued 27,599,722 shares of its Common
Stock. Effective December 31, 2006, Legend issued one (1) new bonus share of
Common Stock for every two (2) shares of Common Stock outstanding on the record
at that date. The issue of the new bonus shares of Common Stock were on a
pro-rata basis to all shareholders. As a result, the Company issued 41,934,337
shares of its Common Stock.
 
 The
Company has accounted for these bonus issues as a stock split and accordingly,
all share and per share data has been retroactively restated.
 
 1
 
 Currency
 
 We use the
Australian dollar as our reporting currency, since we are headquartered in
Australia and our administrative expenses are incurred in Australian dollars.
References to dollars are to Australian dollars (A$) unless otherwise indicated
as being United States dollars (US$). For the convenience of the reader, the
Australian Dollar figures for the year ended December 31, 2007 have been
translated into United States Dollars (“US$”) using the rate of exchange at
December 31, 2007 of A$1.00=US$0.8767.  Prior to July 31, 2006, the
Company’s functional currency was the US dollar. However, as a result of the
purchase of diamond mining tenements in Northern Australia in July 2006, the
Company’s 2006 revenue and expenses will be primarily denominated in Australian
dollars (A$). Statement of Financial Accounting Standards (‘‘SFAS’’) No. 52,
Foreign Currency Translation, states that the functional currency of an entity
is the currency of the primary economic environment in which the entity
operates. Accordingly the Company determined that from August 1, 2006 the
functional currency of the Company is the Australian dollar. Assets, liabilities
and equity were translated at the rate of exchange at July 31,
2006.  Revenue and expenses were translated at actual rates.
Translation gains and losses were included as part of accumulated other
comprehensive gain.
 
 Restatement
of comparative numbers was made for the change in functional and reporting
currency. The change was adopted prospectively beginning July 31, 2006 in
accordance with SFAS No. 52.
 
 History
 
 Legend was
incorporated in the State of Delaware on January 5, 2001 under the name Sundew
International, Inc., to engage in the business of selling compatible inkjet
cartridges and refill kits on the Internet.
 
 On March
13, 2003, Legend filed for an Amendment to its Certificate of Incorporation (the
"Amendment") pursuant to which the name of Sundew International, Inc. was
changed to "Legend International Holdings, Inc."
 
 In
November 2004, Renika Pty Ltd, an Australian corporation (“Renika”) acquired an
88% interest in Legend from William and Michael Tay (the “Tays”), the Tays
resigned as Directors and Officers of Legend, Joseph Gutnick was appointed
President, Chief Executive Officer and a Director and Peter Lee was appointed
Secretary.  The Tays also granted Renika an option to acquire an
additional 578,240 shares of Common Stock that Renika exercised in 2005.
Commencing in fiscal 2005, Legend has decided to focus its business on mineral
exploration activities.
 
 Effective
as of March 3, 2006, the Company entered into a Contract for the Sale of Mining
Tenements (“Contract”) with Astro Diamond Mines N.L. (“Astro”) an Australian
company pursuant to which the Company shall acquire certain diamond mining
tenements in Northern Australia from Astro, which is described
above.
 
 In
November 2007, Legend acquired a number of phosphate exploration interests in
the State of Queensland in Australia
 
 Legend is
an exploration stage company.  Legend has not been involved in any
bankruptcy, receivership or similar proceeding.  Legend has not been
involved in any material reclassification, merger consolidation, or purchase or
sale of a significant amount of assets not in the ordinary course of
business.
 
 SEC
Reports
 
 We file
annual, quarterly, current and other reports and information with the
SEC.  These filings can be viewed and downloaded from the Internet at
the SEC’s website at www.sec.gov.  In addition, these SEC filings are
available at no cost as soon as reasonably practicable after the filing thereof
on our website at www.lgdi.net. These
reports are also available to be read and copied at the SEC’s public reference
room located at Judiciary Plaza, 100 F Street, N.E., Washington, D.C.
20549.  The public may obtain information on the operation of the
public reference room by calling the SEC at 1-800-SEC-0330.
 
 2
  Proposed
Spin-off of Uranium-Phosphate Interests
 
 On May 14,
2007, the Company announced that it intended to spin off its uranium-phosphate
exploration interests to a new public company to be traded on the over the
counter market in the United States.  As a result of subsequent
increases in the market price of phosphate and positive developments with the
Company’s phosphate exploration interests, the Company has determined not to
proceed with the spin-off at this time.
 
 Description
of Business
 
 Business
 
 The
Company has never generated any significant revenues from operations and is
still considered an exploration stage company.  The Company was
initially formed to engage in the business of selling compatible inkjet
cartridges and refill kits on the Internet for the consumer printer
market.  In March 2003, management of the Company decided to engage in
the business of building and acquiring controlling or other interests in one or
more companies engaged in the contract sales and distribution of specialty
medical products, and raise additional capital for this
purpose.  Neither business was successful and operations of both were
eventually discontinued.  During fiscal 2004, management of the
Company developed a plan of operations to acquire income-producing real
property.  The Company did not acquire any properties pursuant to such
plan.
 
 Following
the change of management in November 2004, the Company developed a new plan of
operations, which was to engage in mineral exploration and development
activities.  Legend's business plan calls for the identification of
mineral properties where it can obtain secure title to exploration, development
and mining interests.
 
 Legend’s
Land Holdings and Projects
 
 The Legend
landholdings, prospective for phosphate, diamonds and base metals cover 40,525
square acres in Queensland, Australia and 4.7 million square acres in the
Northern Territory, Australia. In Queensland, Legend’s holdings are historical
phosphate deposits located in the Mt. Isa district, along the margin of the
Georgina Basin which is host to major base metal and phosphate
deposits.
 
 Legend’s
mining tenements are divided into the following project areas:
 
 ·
                  Phosphate
      Projects:
 §
                  the
      Queensland Phosphates &
 §
                  Selby
      Project, Northern Territory.
 
 ·
                  Diamond
      Projects:
 §
                  The
      Foelsche Project encompassing:
 §
                  McArthur
      River, Northern Territory.
 §
                  Glyde
      River, Northern Territory.
 §
                  Foelsche,
      Northern Territory
 §
                  Abner
      Range, Northern Territory.
 §
                  Cox,
      Northern Territory.
 
 ·
                  All
      of these project areas are also prospective for Base
    Metals.
 
 Queensland
Projects
 
 Tenement Status,
Details & Commitments (Projected) Queensland,
Australia
  3
  Lease
                  Lease
                    Status
                  Project
                  App.
      Date
                  Grant
                    Date
                  Expiry
                    Date
                  
                  Area
                    (Ha)
                  
                  Anni.
      Date
                    (2008)
                  
                  Rent $
                    (2008)
                  
                  
                  Commit.
      $
                    (2008)EPM14905
                  Granted
                  Quita
      Creek
                  10/12/2004
                  12/12/2006
                  11/12/2011
                  
                  
                  29,250
                  
                  11/12/2008
                  
                  $
                  11,178
                  
                  
                  $
                  70,000EPM14906
                  Granted
                  Highland
      Plains
                  10/12/2004
                  24/08/2007
                  23/08/2012
                  
                  
                  32,484
                  
                  23/08/2008
                  
                  $
                  12,150
                  
                  
                  $
                  50,000EPM14912
                  Granted
                  Lily Creek
                  17/12/2004
                  30/01/2007
                  29/01/2012
                  
                  
                  32,118
                  
                  29/01/2008
                  
                  $
                  12,460
                  
                  
                  $
                  50,000EPM14753
                  Application
                  D-Tree
                  9/08/2004EPM16683
                  Application
                  Lady
      Jane
                  30/07/2007EPM16940
                  Application
                  Lady
      Annie
                  9/10/2007EPM16941
                  Application
                  Thorntonia
                  9/10/2007EPM16942
                  Application
                  Lady
      Annie
                  9/10/2007EPM17087
                  Application
                  Drifter
                  3/12/2007




Landholdings
 
 Some of
Legend’s landholdings (tenements) are held under licence from the Queensland
Government in Australia. Tenements are granted as either exploration permits,
mineral development licences or mining leases.
 
 Exploration
permits can only be applied for over available ground.  Applications
consist of a prescribed application form, proposed exploration programme with
estimated expenditure and the prescribed application fee.  An
exploration permit number is assigned when the application is
received.  The Department then assesses the application to determine
whether a company is a suitable candidate and proposes to spend sufficient funds
on exploration on the licence.  If the Department considers a company
to be a suitable candidate, the Department then assesses the environmental
impact of the proposed exploration programme and also commences the native title
process.  The native title process involves advertising the
application for the purpose of determining whether there are any objections to
the licence being granted. If there are no objections, the permit is
granted.
 
 The
exploration permit is granted for five years provided the company continues to
comply with the licences conditions.  There is a statutory requirement
to reduce the area of the exploration licence by fifty percent before the end of
years three, four and five.
 
 Rent is
required to be paid each year in advance.
 
 4
  An annual
expenditure report is due each year, as a statement of the amount that has been
spent on the ground.  An annual technical report is also due each
year, as a statement of the exploration work that has been undertaken on the
ground and what work is proposed to be undertaken for the coming
year.
 
 The
exploration permit is due to expire at the end of year five but a renewal
application can be lodged prior to the expiry to, if granted, extend the permit
for up to another five years.  A summary of work completed on the
ground together with a detailed explanation of the work proposed for the ground
is required to accompany the renewal application.
 
 If the
company proposes to mine a measured resource it will need to apply for a Mining
Lease.  As the Exploration Permit holder it has automatic priority to
the ground to be the subject of the mining Lease.  Applications
consist of a prescribed application form, details of the proposed development,
the financial resources to fund the proposal and the prescribed application
fee.  A mining lease number is assigned when the application is
received.  The Department then assesses the application to determine
the suitability of the proposal.  The application will then pass
through the environmental and native title process.  An agreement will
need to be negotiated with the native title holders/claimants as part of the
native title process.
 
 A mineral
lease may be granted for such term as the Minister thinks fit.  The
company is required to state the term of the lease required at the time of
application.  The term required is stated on the application
form.
 
 Rent is
required to be paid each year in advance.
 
 An annual
expenditure report is due each year, as a statement of what has been spent on
the ground.  An annual technical report is also due each year, as a
statement of what work has been done on the ground and what work is proposed for
the coming year.
 
 Geological
History of the Georgina Basin of Queensland.
 
 The
Georgina Basin hosts a number of phosphorate deposits near Mt Isa. In
particular, the Beetle Creek Formation and Thorntonia Limestone contain three
key phosphatic lithologies: pelletal, microsphorite and replacement-types. The
Lady Annie, Lady Jane, D-Tree & Thorntonia phosphate deposits lie within the
Beetle Creek Formation and its lateral facies equivalents. (Howard,
1986)
 
 The Inca
Formation is the youngest unit, composed of  laminated siltstones and
shales and conformably overlies Thorntonia Limestone. The Thorntonia Limestone
is a dolomitic limestone with increasing chert bands toward top. It is the
lateral facies equivalent to the Beetle Creek Formation, with which it
intertongues. The Beetle Creek Formation hosts the phosphate deposits, composed
predominately of interbedded coarse to fine grained phosphorites, siltstone,
claystone, chert and some descrete carbonate lenses. Locally, karst-like
surfaces are filled with chalky high-grade phosphate that appear to replace the
underlying limestone. This unit conformably and gradationally overlies Mt Hendry
Formation which is a discontinuous conglomerate and sandstone. (Cook &
Elgueta, 1986)
 
 All the
deposits formed under coastal, shallow marine conditions. These Cambrian
sediments are covered by up to 71m of Mesozoic claystone and sandstone and
Cainozoic alluvium and eluvium. Coarse to medium grained skeletal-ovulitic
grainstone and packstone phosphorites are thought to have formed through
reworking, transport and accumulation grains.  Phosphatic
microsphorite are thought to have formed from the suspension of very fine
grained detrital material or precipitation from the water column in very shallow
supratidal areas. (Cook & Elgueta, 1986) The replacement phosphates are
thought to have occurred due to post-depositional phosphate replacement of
carbonate, such as found at D-Tree.
  5









6









7









8


Exploration
History and Forward Work Program
 
 The Lady
Annie, Lady Jane, D-Tree & Thorntonia phosphate deposits are located
approximately 130 kilometres north-west of Mt Isa in the Georgina Basin. The
historically published mineralized material estimates lie within the same
geological rock unit and their size and tonnages are as follows:
 
 Deposit
              Classification
              
              Estimated
                million
      tonnes
              
              
              
              %P2O5Lady
      Annie
              Non-reserve
      mineralized material*
              
              
              293
              
              
              
              16.6
              1Lady
      Jane
              Non-reserve
      mineralized material*
              
              
              193
              
              
              
              17.6
              1
 
 * Such
non-reserve mineralized material would not qualify as a reserve until a
comprehensive evaluation based upon unit cost, grade, recoveries and other
material factors concludes being both legal and economic
feasibility
 
 Source of
Information
 
 Historically
published resources & reserves in Queensland Minerals Mines & Projects,
4th
Edition. From: 1 1990
Freeman, M.J., Shergold, J.H., Morris, D.G., & Walter, M.R. Late Proterozoic
And Palaeozoic Basins of Central and Northern Australia - Regional Geology and
Mineralisation. 21996
Draper, J.J Phosphate- Queensland Mineral Commodity Report, Queensland
Government Mining Journal, 97 (1131) 14-25.
 
 Past
feasibility studies by BH South Ltd (Rogers J.K, 1988) occurred in 1974 on a
phosphate rock beneficiation plant and slurry pipeline to the Queensland coast.
Beneficiation test shafts and mining scale trenches were dug. A pilot plant
built in 1973 produced 34% P205
concentrate at Lady Annie from 17% P205 rock (Cook, P.J. 1989). Feasibility was
concluded at that time at a production rate of 4-5 million tonnes per year
(Cook, P.J. 1989).
 
 A thorough
Open File Historical data review has commenced. Past exploration and reserve
estimation data is being acquired and compiled into a global database for use in
re-validating the past surveys, drilling and sampling. Appropriate Heritage,
Environmental and Proposals for Works approvals are being sought. A detailed
field sampling and drilling program is being developed in full awareness of
quality control and compliance procedures to verify past data and re-establish
the volumes and percentage of phosphate in these deposits. It is anticipated
that fieldwork will commence mid 2008.
 
 Access
 
 Access to
the Queensland project areas is by commercial airline to Mount Isa, a mining
district in Queensland. From Mount Isa it is approximately 96 kilometres by road
via the Barkly Highway, however helicopter is often used due to rugged terrain.
Mount Isa has substantial infrastructure, accommodation and other facilities.
Between April to November, in the dry season, four wheel drive vehicles can be
used on dirt roads.
 
 Government
Regulations, Declarations & Conditions
 
 The
Company’s exploration operations are subject to federal and state laws and
regulations governing the method of acquisition and ownership of mining rights,
exploration, development, mining, production, taxes, labour standards,
occupational health, mine safety, toxic substances other
matters.   Federal and State legislation also governs
environmental management and native title issues.  We are committed to
and, to our knowledge, are in compliance with all governmental legislation and
regulations.
 
 Mineralisation
 
 No known
mineral reserves are known on our land in Queensland, however phosphate
mineralized material deposits are recorded.  Our proposed program will
be developed with a view to verify existing data and prove the mineralization up
to mineralized material and reserve grade.
 
 9
  Government
Requirements for Maintenance of Licences
 
 To ensure
that licences are kept in good standing the Company is required to pay the
annual rent amount for each licence on its respective anniversary
date.  The amount due is dependent upon the size and age of the
licence.  The Company is also required to work the licences and meet
the annual expenditure commitments.  Annual reporting is required,
specifying details of the exploration programme which has occurred and which is
anticipated for the following year.  Failure to comply would place the
licences at risk of cancellation and therefore forfeit the right to explore on
that ground.
 
 Licence
Conditions
 
 The
Company is required to meet certain standard conditions and obligations as
specified by the Queensland Mineral Resources Act, Exploration Permits. These
include conducting activities in a way which minimise environmental damage,
rehabilitation, avoiding interference with registered native title sites or
areas and ensuring compliance with any other relevant legislation. Programmes of
Work are to be submitted at the time of application for any ground disturbance
or exploration works, the conditions of which are clearly specified and adhered
to. Security bonds are payable on the grant of the permits and additional
conditions can be imposed by the government State Minister.
 
 Native
Title
 
 The rights
and obligations of the Company with respect to native title obligations differ
depending upon the permit’s proposed impact on the land.  All the
exploration permit applications held by the company will need to comply with the
Native Title Act.  The overwhelming majority on permit applications
will be advertised under the expedited procedure and require advertising to
determine whether there are any objections.  If they are no
objections, the Queensland Government can grant the permit and will impose the
Native Title Protection Conditions on the permit before grant.  These
conditions ensure that any native title claimants are aware of the proposed
exploration work and gives them an opportunity to identify any culturally
sensitive areas.  If there are objections, the company will need to
negotiate an agreement with the native title claimants.  Following
lodgement of this agreement with the Queensland government the permit will be
granted.
 
 Environment
 
 The rights
and obligations of the Company with respect to environmental management and
rehabilitation are based upon the principles of disturbance minimisation,
including such things as preservation of mature trees, preventing the spread of
noxious weeds, avoiding the disturbance of waterways and waste
management.  Rehabilitation is a condition of the Security bond and
requires such things as sealing of collars, plugging of casings and replacement
of topsoils.
 
 Royalties
 
 The
royalty rate for phosphate rock is the higher of the following: (a) 80 cents for
each tonne of phosphate rock; or (b) the rate, rounded down to 2 decimal places,
for each tonne of phosphate rock worked out using the following formula
–
  
 where
R is the royalty rate,
G is the average P2O5 content of
the phosphate rock for the return period, and Pcurr
is the average price for the return period, converted to Australian dollars at
the average hedge settlement rate for the return period, of Moroccan phosphate
rock with 32.3% P2O5
content.
 
 10
  The
royalty is payable to the State of Queensland.
 
 Contractual
Agreements in relation to Queensland Phosphate Interests
 
 (i)
              On
      November 2, 2007, we entered into an agreement with Iron Duyfken Pty Ltd
      to acquire three (3) project areas in the Georgina Basin of Queensland,
      Australia. Each project hosts a known and well documented, substantial
      deposit of phosphate rock (Cook, P.J, 1989, Howard, P.F, 1986). These
      deposits were delineated by earlier work conducted by previous major
      companies since 1967 and have been named the Lady Annie, Lady Jane and
      Thorntonia phosphate deposits. The deposits were defined in times when
      phosphate prices were low. Phosphate prices have risen considerably since
      those times due to increased world demand especially from China and India.
      Past feasibility studies on these deposits will be reassessed with a view
      to commercialization of the deposits, based on current prices. Legend
      agreed to pay A$500,000 and issue 500,000 shares of Common Stock as
      consideration.
 
 (ii)
              Effective
      November 7, 2007, we entered into an agreement with Ansett Resources &
      Industries Pty Ltd to acquire one (1) project area in the Georgina Basin
      of Queensland, Australia. The project hosts a known and well documented,
      substantial deposit of phosphate rock (Cook, P.J, 1989, Howard, P.F,
      1986). The deposit was delineated by earlier work conducted by previous
      major companies since 1967 and have been named the D-Tree phosphate
      deposit. As set out above, the deposit was defined in times when phosphate
      prices were low. Phosphate prices have risen considerably since those
      times due to increased world demand especially from China and India. Past
      feasibility studies on this deposit will be reassessed with a view to
      commercialization of the deposit, based on current prices. Legend agreed
      to pay A$300,000 as consideration.
 
 (iii)
              We
      entered into a farm-in and joint venture heads of agreement with King
      Eagle Resources Pty Limited on December 7, 2007 pursuant to which Legend
      can earn an 80% interest in phosphate on three tenement blocks named Quita
      Creek, Highland Plains and Lily and Sherrin creek by spending $3 million
      on phosphate exploration over five years. Legend has no rights to any
      other minerals on the three tenement
blocks.
 
 (iv)
              Effective
      February 27, 2008, we entered into a Share Sale Agreement whereby the
      Company agreed to purchase all of the issued and outstanding shares of
      Teutonic Minerals Pty Ltd. As a result, Teutonic became a subsidiary of
      the Company from that date. Teutonic holds an application for a mineral
      licence over phosphate in the Georgina Basin in the State of Queensland,
      Australia. The consideration payable to the vendors was A$300,000, and the
      Company granted a 1% gross revenue royalty from production from the
      mineral licence.
 
 Northern
Territory Exploration Interests
 
 Tenement
Status, Details & Commitments (Projected) Northern Territory,
Australia
  11


Lease
              Lease
                Status
              Project
              Grant
                Date
              Expiry
                Date
              
              Area
                (Ha)
              
              Anni.
                Date $
                (2008)
              
              Rent $
                (2008)
              
              
              Commit.
      $
                (2008)EL22244
              Granted
              Foelsche
              3/7/2003
              3/6/2009
              
              
              144,500
              
              3/6/2008
              
              
              79,376
              
              
              
              30,000EL22245
              Granted
              Foelsche
              3/7/2003
              3/6/2009
              
              
              42,410
              
              3/6/2008
              
              
              22,704
              
              
              
              100,000EL22246
              Granted
              Selby
              2/5/2003
              2/4/2009
              
              
              103,700
              
              2/4/2008
              
              
              61,600
              
              
              
              30,000EL22247
              Granted
              Selby
              2/5/2003
              2/4/2009
              
              
              159,000
              
              2/4/2008
              
              
              86,944
              
              
              
              30,000EL22251
              Granted
              Selby
              4/24/2003
              4/23/2009
              
              
              164,400
              
              4/23/2008
              
              
              88,000
              
              
              
              500,000EL22252
              Granted
              Selby
              8/22/2002
              8/21/2008
              
              
              23,580
              
              8/21/2008
              
              
              25,344
              
              
              
              50,000EL22294
              Application
      12/9/1999
              Cox
              
              
              
              
              108,600EL22295
              Granted
              Cox
              2/5/2003
              2/4/2009
              
              
              79,050
              
              2/4/2008
              
              
              42,944
              
              
              
              30,000EL22296
              Granted
              Cox
              2/5/2003
              2/4/2009
              
              
              43,400
              
              2/4/2008
              
              
              23,936
              
              
              
              30,000EL22297
              Granted
              Cox
              8/5/2003
              8/4/2009
              
              
              70,920
              
              8/4/2008
              
              
              37,840
              
              
              
              30,000EL22298
              Granted
              Cox
              4/24/2002
              4/23/2008
              
              
              98,480
              
              4/23/2008
              
              
              105,248
              
              
              
              30,000EL22299
              Application
      12/9/1999
              Cox
              
              
              
              
              125,600EL22300
              Granted
              Cox
              9/26/2002
              9/25/2008
              
              
              16,560
              
              9/25/2008
              
              
              17,600
              
              
              
              20,000EL22302
              Granted
              Cox
              9/26/2002
              9/25/2008
              
              
              53,270
              
              9/25/2008
              
              
              59,840
              
              
              
              30,000EL22351
              Granted
              Foelsche
              8/5/2003
              8/4/2009
              
              
              31,290
              
              8/4/2008
              
              
              16,720
              
              
              
              30,000EL23116
              Granted
              Abner Range
              3/3/2003
              3/2/2009
              
              
              1,646
              
              3/2/2008
              
              
              880
              
              
              
              15,000EL23117
              Granted
              Abner Range
              3/3/2003
              3/2/2009
              
              
              1,645
              
              3/2/2008
              
              
              880
              
              
              
              20,000EL23118
              Granted
              Abner Range
              3/3/2003
              3/2/2009
              
              
              10,520
              
              3/2/2008
              
              
              5,632
              
              
              
              50,000EL23119
              Granted
              Foelsche
              3/3/2003
              3/2/2009
              
              
              4,927
              
              3/2/2008
              
              
              2,640
              
              
              
              30,000EL23121
              Granted
              Foelsche
              3/3/2003
              3/2/2009
              
              
              5,915
              
              3/2/2008
              
              
              3,168
              
              
              
              100,000EL23126
              Granted
              Cox
              8/5/2003
              8/4/2009
              
              
              19,700
              
              8/4/2008
              
              
              10,560
              
              
              
              20,000EL23127
              Application
      4/10/2001
              Cox
              
              
              
              
              36,020EL23162
              Application
      5/9/2001
              Cox
              
              
              
              
              38,577EL23510
              Granted
              Foelsche
              3/3/2003
              3/2/2009
              
              
              985
              
              3/2/2008
              
              
              528
              
              
              
              40,000EL23511
              Granted
              Foelsche
              3/3/2003
              3/2/2009
              
              
              4,596
              
              3/2/2008
              
              
              2,464
              
              
              
              20,000EL23512
              Granted
              Foelsche
              3/3/2003
              3/2/2009
              
              
              7,237
              
              3/2/2008
              
              
              3,872
              
              
              
              20,000EL23513
              Granted
              Abner Range
              3/3/2003
              3/2/2009
              
              
              22,690
              
              3/2/2008
              
              
              12,144
              
              
              
              30,000EL23514
              Granted
              Abner Range
              3/3/2003
              3/2/2009
              
              
              2,959
              
              3/2/2008
              
              
              1,584
              
              
              
              100,000EL23515
              Granted
              Foelsche
              7/4/2003
              7/3/2009
              
              
              22,820
              
              7/3/2008
              
              
              13,024
              
              
              
              150,000EL25486
              Application
      7/18/2006
              Cox
              
              
              
              
              91,570EL25491
              Granted
              Foelsche
              3/12/2007
              3/11/2013
              
              
              2,628
              
              3/11/2008
              
              
              88
              
              
              
              60,000EL25612
              Application
      9/20/2006
              Cox
              
              
              
              
              91,750EL25613
              Application
      9/20/2006
              Cox
              
              
              
              
              81,710EL25614
              Application
      9/20/2006
              Cox
              
              
              
              
              103,200EL25615
              Application
      9/20/2006
              Cox
              
              
              
              
              28,710EL25616
              Granted
              Foelsche
              8/23/2007
              8/22/2013
              
              
              6,136
              
              8/22/2008
              
              
              209
              
              
              
              15,000EL25617
              Granted
              Foelsche
              8/23/2007
              8/22/2013
              
              
              24,840
              
              8/22/2008
              
              
              847
              
              
              
              40,000EL25629
              Application
      9/25/2006
              Cox
              
              
              
              
              17,190EL26175
              Application
      5/22/2007
              Foelsche
              
              
              
              
              126EL26176
              Application
      5/22/2007
              Foelsche
              
              
              
              
              590EL26177
              Application
      5/22/2007
              Foelsche
              
              
              
              
              281EL26360
              Application
      8/3/2007
              Selby
              
              
              
              
              329EL26406
              Application
      8/27/2007
              Foelsche
              
              
              
              
              8,079EL26495
              Application
      10/23/2007
              Foelsche
              
              
              
              
              1,970EL26507
              Application
      10/29/2007
              Foelsche
              
              
              
              
              7,235EL26509
              Application
      10/29/2007
              Foelsche
              
              
              
              
              2,630EL26514
              Application
      11/5/2007
              Cox
              
              
              
              
              5,011EL26515
              Application
      11/5/2007
              Cox
              
              
              
              
              3,635EL26528
              Application
      11/19/2007
              Foelsche
              
              
              
              
              32,240




12




Landholdings




All of
Legend’s landholdings (tenements) are held under licence from the Northern
Territory Government in Australia. Tenements are granted as either exploration
licences or mining leases.
 
 Exploration
licences can only be applied for over available ground.  Applications
consist of a prescribed application form, proposed exploration programme with
estimated expenditure and the prescribed application fee.  An
exploration licence number is assigned when the application is
received.  The Department then assesses the application to determine
whether a company is a suitable candidate and proposes to spend sufficient funds
on exploration on the licence.  If the Department considers a company
to be a suitable candidate, the Department then commences the native title
process which involves advertising for the purpose of determining whether there
are any objections to the licence being granted. If there are no objections, the
licence is granted.
 
 The
exploration licence is granted for six years provided the company continues to
comply with the licences conditions.  There is a statutory requirement
to reduce the area of the exploration licence by fifty percent before the end of
years two, three, four and five.  An application to waive the
reduction can be made at the time the reduction is due.
 
 Rent is
required to be paid each year in advance.  The cost per block is
increased by 100% each year after year two.
 
 An annual
expenditure report is due each year, as a statement of the amount that has been
spent on the ground.  An annual technical report is also due each
year, as a statement of the exploration work that has been undertaken on the
ground and what work is proposed to be undertaken for the coming
year.
 
 The
exploration licence is due to expire at the end of year six but a renewal
application can be lodged prior to the expiry to, if granted, extend the licence
for another two years.  A summary of work completed on the ground
together with a detailed explanation of the work proposed for the ground is
required to accompany the renewal application.  The rent of the two
year period is also required with the renewal application.
 
 If the
company proposes to mine a measured resource it will need to apply for a Mineral
Lease.  As the Exploration Licence holder it has automatic priority to
the ground to be the subject of the Mineral Lease.  Applications
consist of a prescribed application form, details of the proposed development,
the financial resources to fund the proposal and the prescribed application
fee.  A mineral lease number is assigned when the application is
received.  The Department then assesses the application to determine
the suitability of the proposal.  The application will then pass
through the native title process.  An agreement will need to be
negotiated with the native title holders/claimants as part of the native title
process.  The mineral leases must be surveyed before it is
granted.
 
 A mineral
lease may be granted for such term as the Minister thinks fit.  The
company is required to state the term of the lease required at the time of
application.  The term required is stated on the application
form.
 
 Rent is
required to be paid each year in advance.
 
 An annual
expenditure report is due each year, as a statement of what has been spent on
the ground.  An annual technical report is also due each year, as a
statement of what work has been done on the ground and what work is proposed for
the coming year.
 
 Geological
History and Kimberlite Occurrence in the McArthur River Basin.
 
 The North
Australian Craton is one of two principal tectonic domains in the Northern
Territory. The dominant tectonic episode for formation of the Craton, reworking
the Archaean (or Palaeo-Proterozoic) basement, was the Barramundi Orogeny at
1865-1850Ma. Outcrops of these older deformed and metamorphosed rocks are now
surrounded by younger basins.
 
 13
  The
McArthur Group is the principal element of cover over the North Australian
Craton, composed of mildly deformed and unmetamorphosed Meso-proterozoic
(1800-570Ma) dolomitic carbonate, evaporates and sediments. The McArthur River
Basin extends over 180,000 square kilometers and its sediments host a number of
base metal occurrences including the McArthur Lead-Zinc-Silver shale-hosted
deposit; strata-bound, disseminated Lead-Zinc deposits; the Redbank Copper
deposits and Cobalt, Uranium and Iron.
 
 The
McArthur River Basin is covered by approximately 100 meters of Cambrian Bukalara
sandstone and flood basalts in the south. Widespread, young Cretaceous
sedimentation covered the region but much has been removed through erosion. One
remnant of Cretaceous sediment is host to the Merlin field which represents the
youngest volcanic event in the region.
 
 The major
structural feature in the McArthur Basin is the north to north-west trending
Batten Trough or Batten Fault Zone approximately 70 kilometres wide, to which
Legend’s holdings lie to the east. The Trough is bound on the west by the Emu
Fault which transects Legend’s holdings in the McArthur River Project. The
associated Mallapunyah and Calvert faults are approximately 50 kilometres apart
and also trend north-west.
 
 The
presence of microdiamonds across the North Australian Craton defies geological
boundaries, extending right across its heart. This wide distribution may be due
to recycling of the microdiamonds through the younger Cretaceous by fluvial
processes. However, an element of high-level fracture control is now evidenced
by the Merlin deposits. Since the discovery of the Merlin field, diamond
exploration approaches have shifted from Proterozoic mobile belts with little
consideration of regional geology, to incorporate the range of fracture zones in
the North Australian Craton. The North Australian Craton is extensively
underlain by Archaean basement and deep lithospheric, cratonic rocks may be
tapped by younger kimberlites as they intrude into these fractures. The Merlin
kimberlites are certainly younger than their Cambrian sandstone host, yet older
than their Cretaceous cover.
 
 Access
 
 Access to
the Northern Territory project areas is by commercial airline to Darwin, the
capital of the Northern Territory. From Darwin it is approximately 950
kilometres by road approximately 2 hours flying time by air. The nearest major
town is Borroloola which has limited accommodation and other facilities, where
Legend has a base. Access from Borroloola to the drilling sites is normally via
helicopter as terrain is rugged. Between April to November, in the dry season,
four wheel drive vehicles can be used on dirt roads however, distances from
Borroloola to field sites range between 90 and 150 kilometres.
 
 Access to
the Queensland project areas is by commercial airline to Mount Isa, a mining
district in Queensland. From Mount Isa it is approximately 96 kilometres by road
however, helicopter is often used due to rugged terrain. Mount Isa has
substantial infrastructure, accommodation and other facilities. Between April to
November, in the dry season, four wheel drive vehicles can be used on dirt
roads
 
 Exploration
History and Forward Work Program
 
 Selby
Project
 
 The Selby
project is located 100km SW of the coast of the Gulf of Carpentaria in the
McArthur Basin, adjacent to the Georgina Basin which hosts Legend’s Queensland
phosphates. Historically recorded phosphate rock outcrops at surface in
recurrent lenses over a 60 kilometre strike. Uranium, which is a common
by-product of marine phosphate deposits, accounting for a significant proportion
of the world’s Uranium production, is also present.
 
 An
historical Open File review of the Selby region has also identified base metal
results from stream sampling adjacent to the Karns Dolomite and regional fault
systems. Historical data also reveals that the region remains prospective for
diamonds.
 
 14
  A
multi-facetted approach to exploration of the Selby phosphate was established in
2007. Geological mapping, rock chip, stream and loam sampling, diamond and RC
drilling was undertaken.
 
 Geochemical
analysis of sampling will be undertaken to assist in the further development of
this program, in order to adequately delineate the extent of phosphate present.
Further work is anticipated to explore for structural or shale-hosted base
metals.
 
 McArthur
River
 
 Legend’s
base metal project is situated approximately 20 kilometres south west of
Borroloola. The Emu fault zone which runs through Legend’s tenements is a
mineralised geological feature hosting the HYC Pyritic Shale base metal prospect
and a number of known base metal deposits accounting for 8% of world base metal
(lead-zinc-silver) production.
 
 A detailed
collation and analysis of a significant amount of available historical open file
geophysical and geochemical data is underway. Tracks have been made to enable
access for a detailed geological mapping program, stream & loam sampling.
149 RC/RAB drill holes have been approved and this drilling will commence in
2008.
 
 Abner
Range
 
 The Abner
Range Plateau is approximately 300 kilometers south of Borroloola, west of The
Gulf of Carpentaria in the Northern Territory. It is host to the diamondiferous
Abner Range Kimberlite part of the Merlin diamondiferous intrusive field, only
seven kilometres north of Legend’s holdings. Past indicator mineral sampling by
Ashton and Rio Tinto has recovered macrodiamonds, microdiamonds and chromite
indicator minerals with no primary source yet determined.
 
 Airborne
Electro-Magnetic (“EM”), magnetic and gravity surveys flown in late 2006 have
identified numerous EM, gravity & magnetic anomalies and grid-based loam
samples were taken as follow up to this result and of other
targets.
 
 Geochemical
analysis of the results of the loam gridding and sampling will be used to inform
regions of high priority for ground gravity surveys. This will be conducted as a
part of the ongoing diamond core and reverse circulation drilling
program.
 
 Glyde
Project
 
 The Glyde
River is in the Batten Trough and hosts 40 kilometres of alluvial gravels
sourced from numerous diamond bearing catchments including the entire Merlin
diamond field. The pipes in the Merlin field are located on the eastern shoulder
of the Battern Trough only six kilometres east of the Emu Fault. They have
intruded the Cambrian Bukalara sandstone and were emplaced around the time of
the Alice Springs Orogeny.
 
 The Legend
tenement is north of the HYC Pyritic Shale base metal prospect and this Member
has been intersected in several drill holes. CRAE has explored the tenement area
for kimberlite. Ashton collected two bulk samples from separate drainages and
had diamond responses. Helicopter magnetics and EM covered the northern part of
the tenement as part of Rio Tinto’s exploration around the Merlin pipe
field.
 
 An
airborne geophysical program flown in late 2006 located many targets for
drilling. Bulk sampling, stream and loam sampling and an RC drilling program was
undertaken in December 2006.
 
 The
geochemistry of drilling and sampling undertaken in 2006 will be analysed in
conjunction with geophysical and geological data in order to delineate priority
targets. The tenement covering the Glyde River to the north will be examined for
alluvial diamonds.
 
 Foelsche
Project
 
 15
  Legend’s
Foelsche Project tenements lie east of the Glyde Project and Merlin diamond
field. They are bound by regional scale faults which act as fluid conduits for
mineralisation and have uplifted basement rocks up to lie against younger
sandstones. The area contains historical trains of kimberlite indicator minerals
in streams draining the area.
 
 In 2005,
airborne EM/magnetics were flown by Astro which identified priority geophysical
anomalies. These were investigated with ground gravity surveys and RC/diamond
drill holes in 2006. The source of the geophysical anomalies was attributed to
depressions in the Proterozoic sandstone bedrock which were infilled by younger
Cretaceous/Tertiary sediment. Similar infill sequences are known to typically
occur over kimberlites in the region.
 
 Many
exploration targets at Foelsche are not yet explored and numerous kimberlite
indicator mineral trains require follow-up. Re-appraisal of airborne
EM/magnetics, additional aeromagnetic surveys and follow-up drilling is planned
for the area.
 
 Cox
Project
 
 The Cox
Project covers approximately 8,676.9 square kilometers and is located between
Roper Bar and Cape Crawford on the north western part of the Bauhinia Downs. In
the 1980’s indicator mineral sampling by Ashton and Rio Tinto recovered numerous
microdiamonds and three macrodiamonds. Magnetic anomolies and some chromite
indicator minerals were found but a primary source was not found by these
companies.
 
 Exploration
carried out over the Cox Project has included site investigations to verify
historical sampling results, a compilation and analysis of historic exploration
data from open-file reports and multi-client airborne magnetic data with a view
to developing an appropriate exploration strategy.
 
 A loam and
stream sampling program is being developed to chase the results observed in the
limited sampling undertaken to date. This would enable a thorough coverage of
transportation systems in the tenements.
 
 16
  Tenement
Commitment & Expenditure Figures (Past & Projected) Northern Territory,
Australia.
 
 The
Department have verbally agreed with Legend that as long as legend spends more
on exploration than the commitment on a project basis, the Department will
consider legend to have met commitment and grant waiver of reduction
applications. Furthermore, the Department agreed to grant waivers of the Cox
project as a result of the amounts spent on other projects by
Legend.
  Project
                  TenID
                  Grant
                  2005-2006
                  2006-2007
                  2007-2008Commit
                  Expend
                  Commit
                  Expend
                  Commit
                  ExpendCOX
                  EL
      22295
                  05/02/2003
                  25,000
                  7,899
                  25,000
                  15,700
                  30,000
                  1,898COX
                  EL
      22296
                  05/02/2003
                  25,000
                  7,483
                  25,000
                  35,927
                  30,000
                  5,959COX
                  EL
      22297
                  05/08/2003
                  20,000
                  12,736
                  20,000
                  5,103
                  30,000
                  2,235COX
                  EL
      22298
                  24/04/2002
                  20,000
                  20,211
                  20,000
                  25,705
                  30,000
                  52,055COX
                  EL
      22300
                  26/09/2002
                  20,000
                  6,190
                  20,000
                  2,521
                  20,000
                  3,814COX
                  EL
      22302
                  26/09/2002
                  20,000
                  6,190
                  30,000
                  2,833
                  30,000
                  4,470COX
                  EL
      23126
                  05/08/2003
                  20,000
                  3,532
                  15,000
                  4,381
                  20,000
                  1,845150,000
                  64,241
                  155,000
                  92,170
                  190,000
                  72,276FOELSCHE
                  EL
      22244
                  07/03/2003
                  20,000
                  20,341
                  20,000
                  3,570
                  30,000
                  2,667FOELSCHE
                  EL
      22245
                  07/03/2003
                  20,000
                  223,256
                  20,000
                  484,319
                  100,000
                  15,411FOELSCHE
                  EL
      22351
                  05/08/2003
                  20,000
                  4,318
                  15,000
                  11,466
                  30,000
                  7,607FOELSCHE
                  EL
      23116
                  03/03/2003
                  20,000
                  5,275
                  15,000
                  9,763
                  15,000
                  17,467FOELSCHE
                  EL
      23117
                  03/03/2003
                  20,000
                  5,251
                  10,000
                  67,170
                  20,000
                  19,729FOELSCHE
                  EL
      23118
                  03/03/2003
                  20,000
                  69,689
                  20,000
                  103,087
                  50,000
                  444,841FOELSCHE
                  EL
      23119
                  03/03/2003
                  20,000
                  86,536
                  20,000
                  76,691
                  30,000
                  5,057FOELSCHE
                  EL
      23121
                  03/03/2003
                  20,000
                  9,248
                  15,000
                  529,146
                  100,000
                  76,911FOELSCHE
                  EL
      23510
                  03/03/2003
                  20,000
                  98,161
                  20,000
                  135,159
                  40,000
                  42,884FOELSCHE
                  EL
      23511
                  03/03/2003
                  20,000
                  6,058
                  20,000
                  3,535
                  20,000
                  2,924FOELSCHE
                  EL
      23512
                  03/03/2003
                  15,000
                  6,338
                  15,000
                  3,535
                  20,000
                  41,861FOELSCHE
                  EL
      23513
                  03/03/2003
                  15,000
                  6,088
                  15,000
                  62,547
                  30,000
                  21,257FOELSCHE
                  EL
      23514
                  03/03/2003
                  20,000
                  6,088
                  15,000
                  228,272
                  100,000
                  404,475FOELSCHE
                  EL
      23515
                  04/07/2003
                  20,000
                  6,914
                  15,000
                  10,731
                  150,000
                  25,902FOELSCHE
                  EL
      25491
                  12/03/2007
                  N/A
                  N/A
                  N/A
                  N/A
                  60,000
                  3,508FOELSCHE
                  EL
      25616
                  23/08/2007
                  N/A
                  N/A
                  N/A
                  N/A
                  15,000
                  4,844FOELSCHE
                  EL
      25617
                  23/08/2007
                  N/A
                  N/A
                  N/A
                  N/A
                  40,000
                  843270,000
                  553,561
                  235,000
                  1,728,991
                  795,000
                  1,138,188SELBY
                  EL
      22246
                  05/02/2003
                  25,000
                  8,714
                  25,000
                  10,350
                  30,000
                  10,790SELBY
                  EL
      22247
                  05/02/2003
                  25,000
                  10,454
                  25,000
                  9,970
                  30,000
                  67,815SELBY
                  EL
      22251
                  24/04/2003
                  20,000
                  150,857
                  20,000
                  339,821
                  500,000
                  1,360,596SELBY
                  EL
      22252
                  22/08/2002
                  20,000
                  23,000
                  25,000
                  39,510
                  50,000
                  11,04890,000
                  193,025
                  95,000
                  399,651
                  610,000
                  1,450,249




17




Government
Regulations, Declarations & Conditions
 
 The
Company’s exploration operations are subject to federal and state laws and
regulations governing the method of acquisition and ownership of mining rights,
exploration, development, mining, production, taxes, labour standards,
occupational health, mine safety, toxic substances other
matters.  Federal and State legislation also governs environmental
management and native title issues. We are committed to and, to our knowledge,
are in compliance with all governmental legislation and
regulations.
 
 Mineralisation
 
 No known
mineral reserves are known on our land in the Northern Territory. Our previous
and proposed programs are exploratory in nature.
 
 Government
Requirements for Maintenance of Licences
 
 To ensure
that licences are kept in good standing the Company is required to pay the
annual rent amount for each licence on its respective anniversary
date.  The amount due is dependent upon the size and age of the
licence.  The Company is also required to work the licences and meet
the annual expenditure commitments.  Annual reporting is required,
specifying details of the exploration programme which has occurred and which is
anticipated for the following year. Failure to comply would place the licences
at risk of cancellation and therefore forfeit the right to explore on that
ground.
 
 Licence
Conditions
 
 The
Company is required to meet certain standard conditions and obilgations as
specified by the Northern Territory Of Australia Mining Act, Exploration
Licence. These include conducting activities in a way which minimise
environmental damage, rehabilitiation, avoiding interference with registered
native title sites or areas and ensuring compliance with any other relevant
legislation. Mine Management Plans are to be submitted for any ground
disturbance or exploration works, the conditions of which are to be clearly
specified for approval and adhered to. Security bonds are payable on Mine
Management plans and additional conditions can be imposed by the government
State or Territory Minister.
 
 Native
Title
 
 The rights
and obligations of the Company with respect to native title obligations differ
between licences depending upon the underlying ownership of the
land.  Crown land, namely pastoral lease land, falls under the Native
Title Act while Aboriginal freehold land falls under the Aboriginal Land Rights
Act (Northern Territory). All the granted licences held by the Company are on
pastoral lease land.  The Company is currently in negotiations with
the local native title council working towards the grant of several more
applications that are situated on aboriginal freehold land. Heritage surveys are
contracted where necessary to ensure the protection of local registered and
unregistered aboriginal heritage sites.
 
 Environment
 
 The rights
and obligations of the Company with respect to environmental management and
rehabilitation are based upon the principles of disturbance minimisation,
including such things as preservation of mature trees, preventing the spread of
noxious weeds, avoiding the disturbance of waterways and waste management.
Rehabilitation is a condition of the Security bond and requires such things as
sealing of collars, plugging of casings and replacement of
topsoils.
 
 Royalties
 
 Certain of
the tenements have a 1% gross revenue royalty payable to an external party from
all mineral production derived on the tenements.
 
 18
  Acquisition
of Northern Territory Tenements
 
 Effective
as of March 3, 2006, Legend entered into a Contract for the Sale of Mining
Tenements (“Contract”) with Astro Diamond Mines N.L. (“Astro”) an Australian
company  pursuant to which the Company acquired certain diamond mining
tenements in Northern Australia from Astro. The consideration payable by Legend
to Astro was Australian dollars $1.5 million and Legend was also required to pay
to Astro any costs incurred on the tenements after February 1,
2006.  Astro provided commercial warranties which are usual for a
transaction of this nature in favour of Legend. Under Australian law, Astro was
required to provide an independent experts report to shareholders for this
transaction. In order to prepare the independent experts report, a mineral
valuation was prepared on behalf of Astro which indicated that the preferred
value for the tenements that are the subject of the transaction was A$1.5
million. This formed the basis of the consideration agreed by the parties. The
President and Chief Executive Officer of the Company, Mr. J. I. Gutnick was
Chairman and Managing Director of Astro at the time of entering into the
Contract and Dr DS Tyrwhitt, an independent Director of the Company, who is also
a Director of Astro was a Director of Astro at the time of entering into the
Contract. The tenements are located in the Northern Territory of Australia and
are prospective for diamonds.
 
 Employees
 
 The
services of our Chief Executive Officer, Chief Financial Officer & Secretary
and General Manager Development and Resources as well as geological, finance and
clerical employees are provided to us pursuant to a Service Agreement effective
December 1, 2004 (the “Service Agreement”) by and between AXIS Consultants Pty
Limited and ourselves.  AXIS also provides office facilities,
equipment, administration and clerical services to the Company pursuant to the
Service Agreement. The Service Agreement may be terminated by written notice
from the parties thereto.
 
 Further
detail relating to additional terms of the Service Agreement is included in
“Item 2- Properties”, “Item 12- Certain Relationships and Related Transactions”
and “Item 10- Executive Compensation”.
 
 
 Item 1A.
              Risk
      Factors.
 
 We
Lack an Operating History And Have Losses Which We Expect To Continue Into the
Future.
 
 To date we
have had no material source of revenue. We have no operating history as a
mineral exploration or mining company upon which an evaluation of our future
success or failure can be made. Our ability to achieve and maintain
profitability and positive cash flow is dependent upon:
 
 -
              exploration
      and development of any mineral property we
  identify;
  -
              our
      ability to locate economically viable mineral reserves in any mineral
      property we identify;
  -
              our
      ability to raise the capital necessary to conduct exploration and preserve
      our interest in mineral claims, increase our interest in mineral claims
      and continue as an exploration and mining company;
  and
  -
              our
      ability to generate revenues and profitably operate a mine on any mineral
      property we identify.
 
 We
Have No Mineral Reserves And We Cannot Assure You That We Will Find Such
Reserves. If We Develop A Mineral Reserve, There Is No Guarantee That Production
Will Be Profitable.
 
 We cannot
guarantee we will ever find any or that we will be successful in locating
commercial mineral reserves on any exploration properties that we may
obtain.  Even if we find a commercial mineral reserve, there is no
assurance that we will be able to mine them. Even if we develop a mine, there is
no assurance that we will make a profit. If we do not find commercial minerals
you could lose part or all of your investment.
 
 19
  We
Will Need Financing To Determine If There Is Commercial Minerals And To Maintain
The Mineral Claims.
 
 Our
success will depend on our ability to raise capital. We will require substantial
additional funds to conduct mineral exploration and development activities on
our tenements. There is no assurance whatsoever that funds will be available
from any source or, if available, that they can be obtained on terms acceptable
to us to make investments. If funds are not available in the amounts required to
achieve our business strategy, we would be unable to reach our objective. This
could cause the loss of all or part of your investment.
 
 The
Report Of Our Independent Registered Public Accounting Firm Contain An
Explanatory Paragraph Questioning Our Ability To Continue As A Going
Concern.
 
 The report
of our independent registered public accounting firm on our financial statements
as of December 31, 2007 and for the years ended December 31, 2007 and 2006
includes an explanatory paragraph questioning our ability to continue as a going
concern. This paragraph indicates that we have not yet commenced revenue
producing operations and have a retained deficit at December 31, 2007 of
A$13,993,863 which conditions raise substantial doubt about our ability to
continue as a going concern. Our financial statements do not include any
adjustment that might result from the outcome of this uncertainty.
 
 We
Are A Small Operation And Do Not Have Significant Capital.
 
 Because we
will have limited working capital, we must limit our exploration. If we are
unable to raise the capital required to undertake adequate exploration, we may
not find commercial minerals even though properties that we may acquire may
contain commercial minerals. If we do not find commercial minerals we may be
forced to cease operations and you may lose your entire investment.
 
 We
Could Encounter Delays Due To Regulatory And Permitting Delays.
 
 We could
face delays in obtaining mining permits and environmental permits. Such delays,
could jeopardize financing, if any, in which case we would have to delay or
abandon work on the properties.
 
 There
Are Uncertainties Inherent In The Estimation Of Mineral Reserves.
 
 Reserve
estimates, including the economic recovery of ore, will require us to make
assumptions about recovery costs and market prices. Reserve estimation is, by
its nature, an imprecise and subjective process and the accuracy of such
estimates is a function of the quality of available data and of engineering and
geological interpretation, judgment and experience. The economic feasibility of
properties will be based upon our estimates of the size and grade of ore
reserves, metallurgical recoveries, production rates, capital and operating
costs, and the future price of diamonds. If such estimates are incorrect or vary
substantially it could affect our ability to develop an economical mine and
would reduce the value of your investment.
 
 If
We Define An Economic Ore Reserve And Achieve Production, It Will Decline In The
Future. An Ore Reserve Is A Wasting Asset.
 
 Our future
ore reserve and production, if any, will decline as a result of the exhaustion
of reserves and possible closure of any mine that might be
developed.  Eventually, at some unknown time in the future, all of the
economically extractable ore will be removed from the properties, and there will
be no ore remaining unless this Company is successful in near mine site
exploration to extend the life of the mining operation. This is called depletion
of reserves. Ultimately, we must acquire or operate other properties in order to
continue as an on going business. Our success in continuing to develop reserves,
if any, will affect the value of your investment.
 
 20
  There
Are Significant Risks Associated With Mining Activities.
 
 The mining
business is generally subject to risks and hazards, including quantity of
production, quality of the ore, environmental hazards, industrial accidents, the
encountering of unusual or unexpected geological formations, cave-ins, flooding,
earthquakes and periodic interruptions due to inclement or hazardous weather
conditions. These occurrences could result in damage to, or destruction of, our
mineral properties or production facilities, personal injury or death,
environmental damage, reduced production and delays in mining, asset
write-downs, monetary losses and possible legal liability. We could incur
significant costs that could adversely affect our results of
operation.  Insurance fully covering many environmental risks
(including potential liability for pollution or other hazards as a result of
disposal of waste products occurring from exploration and production) is not
generally available to us or to other companies in the industry. What liability
insurance we carry may not be adequate to cover any claim.
 
 We
May Subject To Significant Environmental And Other Governmental Regulations That
Can Require Substantial Capital Expenditure, And Can Be
Time-Consuming.
 
 We may be
required to comply with various laws and regulations pertaining to exploration,
development and the discharge of materials into the environment or otherwise
relating to the protection of the environment in the countries that we operate,
all of which can increase the costs and time required to attain operations. We
may have to obtain exploration, development and environmental permits, licenses
or approvals that may be required for our operations. There can be no assurance
that we will be successful in obtaining, if required, a permit to commence
exploration, development and operation, or that such permit can be obtained in a
timely basis. If we are unsuccessful in obtaining the required permits it may
adversely affect our ability to carry on business and cause you to lose part or
all of your investment.
 
 Mining
Accidents Or Other Adverse Events At Our Property Could Reduce Our Production
Levels.
 
 If and
when we reach production it may fall below estimated levels as a result of
mining accidents, cave-ins or flooding on the properties. In addition,
production may be unexpectedly reduced if, during the course of mining,
unfavourable ground conditions or seismic activity are encountered, ore grades
are lower than expected, or the physical or metallurgical characteristics of the
ore are less amenable to mining or processing than expected. The happening of
these types of events would reduce our profitably or could cause us to cease
operations which would cause you to lose part or all of your
investment.
 
 The
acquisition of mineral properties is subject to substantial competition. If we
must pursue alternative properties, companies with greater financial resources,
larger staffs, more experience, and more equipment for exploration and
development may be in a better position than us to compete for properties. We
may have to undertake greater risks than more established companies in order to
compete which could affect the value of your investment.
 
 We
May Lose Our Claims If We Do No Maintain A Minimum Level of Work On The
Claims
 
 We will be
required to carry out a minimum level of work on each claim to maintain of our
claims in good standing. If we cannot afford to carry out the work or pay the
fees we could lose our interest in claims. The loss of some or all of our
mineral claims would adversely affect the value of your investment.
 
 We
are substantially dependent upon AXIS Consultants To Carry Out Our
Activities
 
 We are
substantially dependent upon AXIS for our senior management, financial and
accounting, corporate legal and other corporate headquarters
functions.  For example, each of our officers is employed by AXIS and,
as such, is required by AXIS to devote substantial amounts of time to the
business and affairs of the other shareholders of AXIS.
 
 21
  Pursuant
to a services agreement, AXIS provides us with office facilities, administrative
personnel and services, management and geological staff and
services.  No fixed fee is set in the agreement and we are required to
reimburse AXIS for any direct costs incurred by AXIS for us.  In
addition, we pay a proportion of AXIS indirect costs based on a measure of our
utilization of the facilities and activities of AXIS plus a service fee of not
more than 15% of the direct and indirect costs. This service agreement may be
terminated by us or AXIS on 60 days’ notice.  See “Certain
Relationships and Related Party Transactions.”
 
 We are one
of four affiliated companies.  Each of the companies has some common
Directors, officers and shareholders.  In addition, each of the
companies is substantially dependent upon AXIS for its senior management and
certain mining and exploration staff.  A number of arrangements and
transactions have been entered into from time to time between such
companies.  Currently, there are no material arrangements or planned
transactions between the Company and any of the other affiliated companies other
than AXIS.  However, it is possible we may enter into such
transactions in the future which could present conflicts of
interest.
 
 Future
Sales of Common Stock Could Depress The Price Of Our Common Stock
 
 Future
sales of substantial amounts of Common Stock pursuant to this prospectus or Rule
144 under the Securities Act of 1933 or otherwise by certain stockholders could
have a material adverse impact on the market price for the Common Stock at the
time.  As of the date of this annual report, there are 177,068,825
shares of Common Stock outstanding, of which 151,120,000shares of Common Stock are restricted securities.  Restricted
securities will be available for sale pursuant to Rule 144 under the Securities
Act.  In general, under rule 144, a person (or persons whose shares
are aggregated) who has satisfied a six-month holding period and who is not an
affiliate of the Company may sell restricted securities without limitation as
long as the Company is current in its SEC reports. A person who is an affiliate
of the Company may sell within any three-month period a number of restricted
securities which does not exceed the greater of one (1%) percent of the shares
outstanding or the average weekly trading volume during the four calendar weeks
preceding the notice of sale required by Rule 144.  In addition, Rule
144 permits, under certain circumstances, the sale of restricted securities by a
non-affiliate without any limitations after a one-year holding
period.  Any sales of shares by stockholders pursuant to Rule 144 may
have a depressive effect on the price of our Common Stock.
 
 Our
Common Stock Is Traded Over the Counter, Which May Deprive Stockholders Of The
Full Value Of Their Shares
 
 Our Common
Stock is quoted via the Over The Counter Bulletin Board (OTCBB).  As
such, our Common Stock may have fewer market makers, lower trading volumes and
larger spreads between bid and asked prices than securities listed on an
exchange such as the New York Stock Exchange or the NASDAQ Stock
Market.  These factors may result in higher price volatility and less
market liquidity for the Common Stock.
 
 A
Low Market Price May Severely Limit The Potential Market For Our Common
Stock
 
 Our Common
Stock is currently trading at a price substantially below $5.00 per share,
subjecting trading in the stock to certain SEC rules requiring additional
disclosures by broker-dealers.  These rules generally apply to any
equity security that has a market price of less than $5.00 per share, subject to
certain exceptions (a “penny stock”).  Such rules require the
delivery, prior to any penny stock transaction, of a disclosure schedule
explaining the penny stock market and the risks associated therewith and impose
various sales practice requirements on broker-dealers who sell penny stocks to
persons other than established customers and institutional or wealthy
investors.  For these types of transactions, the broker-dealer must
make a special suitability determination for the purchaser and have received the
purchaser’s written consent to the transaction prior to the sale.  The
broker-dealer also must disclose the commissions payable to the broker-dealer,
current bid and offer quotations for the penny stock and, if the broker-dealer
is the sole market maker, the broker-dealer must disclose this fact and the
broker-dealer’s presumed control over the market.  Such information
must be provided to the customer orally or in writing before or with the written
confirmation of trade sent to the customer.  Monthly statements must
be sent disclosing recent price information for the penny stock held in the
account and information on the limited market in penny stock.  The
additional burdens imposed upon broker-dealers by such requirements could
discourage broker-dealers from effecting transactions in our Common
Stock.
 
 22
  The
Market Price Of Your Shares Will Be Volatile.
 
 The stock
market price of mineral exploration companies like us has been volatile.
Securities markets may experience price and volume volatility. The market price
of our stock may experience wide fluctuations that could be unrelated to our
financial and operating results. Such volatility or fluctuations could adversely
affect your ability to sell your shares and the value you might receive for
those shares.
   Item 1B.
              Unresolved
      Staff Comments.
 
 As of
December 31, 2007, we do not have any Securities and Exchange Commission
staff comments that have been unresolved for more than 180 days.
   Item 2.
              Properties.
 
 Legend has
exploration properties as discussed in “Item 1 – Description of
Business”.  Legend occupies certain executive and office facilities in
New York and in Melbourne, Victoria, Australia which are provided to it pursuant
to the Service Agreement with AXIS.  See “Item 1 – Business -
Employees” and “Item 12 – Certain Relationships and Related
Transactions”.  Legend believes that its administrative space is
adequate for its current needs.
   Item 3.
              Legal
      Proceedings.
 
 There are
no pending legal proceedings to which the Company is a party, or to which any of
its property is the subject, which the Company considers material.
   Item 4.
              Submission
      of Matters to a Vote of Security
Holders.
 
 At the
Company’s Annual Meeting of Stockholders held on November 27, 2007, stockholders
voted to approve all of management’s proposals as follows:
 
 1.           To
elect the following directors to serve a one-year term and until their
successors are elected and qualified:
 
 Votes For
              
              
              Votes WithheldJoseph
      Gutnick
              
              
              89,832,926
              
              
              
              -David
      Tyrwhitt
              
              
              89,832,926
              
              
              
              -
  23
 PART II
  Item 5.
              Market
      for Registrant’s Common Equity, Related Stockholder Matters and Issuer
      Purchases of Equity Securities.
 
 Market
Information
 
 Legend's
Common Stock is traded on the NASD Over-the-Counter Bulletin Board ("OTCBB")
under the ticker symbol "LGDI" and CUSIP# 52467C 10 0. The Company's Common
Stock was initially cleared for trading on the OTC-BB on September 26,
2003.
 
 The
following table sets out the high and low bid information for the Common Stock
as reported by the National Quotation Service Bureau for each period/quarter
indicated in US$:
  Calendar
      Period
              
              High Bid (1)
              
              
              Low Bid (1)2006First
      Quarter
              
              
              3.75
              
              
              
              2.50Second
      Quarter
              
              
              3.90
              
              
              
              2.50Third
      Quarter
              
              
              2.55
              
              
              
              0.85Fourth
      Quarter
              
              
              2.10
              
              
              
              1.002007First
      Quarter
              
              
              1.80
              
              
              
              0.90Second
      Quarter
              
              
              1.95
              
              
              
              1.50Third
      Quarter
              
              
              1.45
              
              
              
              1.25Fourth
      Quarter
              
              
              1.50
              
              
              
              0.75
 (1)
              The
      quotations set out herein reflect inter-dealer prices without retail
      mark-up, mark-down or commission and may not necessarily reflect actual
      transactions.
 
 As of
February 29, 2008, there are 177,068,825 shares of Common Stock
outstanding.
 
 To date we
have not paid dividends on our Common Stock and we do not expect to declare or
pay any dividends on our Common Stock in the foreseeable future. Payment of any
dividends will depend upon our future earnings, if any, our financial condition,
and other factors deemed relevant by the Board of Directors.
 
 Shareholders
  As of
February 29, 2008, there were approximately 159 record holders of the Company's
Common Stock. Within the holders of record of the Company's Common Stock are
depositories such as Cede & Co., a nominee for The Depository Trust Company
(or DTC), that hold shares of stock for brokerage firms which, in turn, hold
shares of stock for one or more beneficial owners. Accordingly, the Company
believes there are many more beneficial owners of its Common Stock whose shares
are held in "street name", not in the name of the individual
shareholder.
 
 Options
  Effective
as of December 12, 2005, the Board of Directors of Company approved the
distribution to stockholders for no consideration of an aggregate of 36,135,500
non-transferable options, each of which is exercisable to purchase one share of
Common Stock of the Company at an exercise price of US$0.25 ($0.111, as
adjusted) per share with a latest exercise date of December 31, 2012 and
otherwise on the terms and conditions set out in Appendix A to the Form 8-K
dated December 12, 2005.  The options were issued on a pro-rata basis
to all stockholders of record on December 31, 2005 on the basis of two (2)
options for every one (1) share of Common Stock owned by a stockholder on the
record date. The options may not be exercised until the shares underlying the
options are registered under federal and state securities laws. On June 26,
2006, the Board of Directors amended the terms and conditions of the options and
included a cashless exercise clause for the options in the terms and conditions.
On July 21, 2006, Renika exercised 34,778,220 options using the cashless
exercise feature and were issued 71,730,079 shares of Common Stock. In December
2006, the Company issued 700,000 shares with attaching options on the basis of
one option for every two shares at no exercise price. The options were exercised
in December 2006. On December 27, 2006, a further optionholder exercised 19,000
options using the cashless exercise feature and were issued 24,750 shares of
Common Stock.  3,123,630 of these options remained outstanding as of
the date of this prospectus.
 
 24
  On
September 19, 2006, the Company issued 8,100,000 options (as adjusted for the
Stock Split) pursuant to the 2006 Equity Incentive Plan. Of the total 8,100,000
options issued, 2,700,000 vest on September 19, 2007, 2,700,000 vest on
September 19, 2008 and 2,700,000 vest on September 19, 2009. The exercise price
of the options is US$1.00 for the President and Chief Executive Officer and for
all other participants, US$0.444 for 50% of the options and US$1.00 for the
balance of 50% of the options. The options expire on September 19, 2016. The
Company has accounted for all options issued in 2006 based upon their fair
market value using the Binomial pricing model. There were no employee stock
options issued by the Company prior to 2006. An external consultant has
calculated the fair value of the options using the Binomial valuation method
using a share price of US$0.50, strike price as set out above, maturity period
of 5.5 to 6.5 years depending on the vesting date, risk free interest rate of
4.69% and volatility of 60%. This equates to values ranging from US$0.116 to
US$0.233 per option depending on the exercise price and vesting
date.  The total value of the options equates to A$752,701
(US$566,633).
  In
November 2006, the Company issued options to purchase 112,500 shares of Common
Stock with an exercise price of US$0.111 per share in connection with the
settlement of a dispute.
 On May 16,
2007, the Company issued 862,500 options pursuant to the 2006 Equity Incentive
Plan. Of the total 862,500 options issued, 287,500 vest on May 16, 2008, 287,500
vest on May 16, 2009 and 287,500 vest on May 16, 2010. The exercise price of the
options is US$0.444 for 50% of the options and US$1.00 for the balance of 50% of
the options. The options expire on May 16, 2017. The Company has accounted for
all options issued based upon their fair market value using the Binomial pricing
model. An external consultant has calculated the fair value of the options using
the Binomial valuation method using a share price of US$0.25, strike price as
set out above, maturity period of 5.5 to 6.5 years depending on the vesting
date, risk free interest rate of 4.92% and volatility of 60%. This equates to
values ranging from US$0.064 to US$0.124 per option depending on the exercise
price and vesting date.  The total value of the options equates to
A$42,593 (US$35,438).
 
 On
December 28, 2007, the Board of Directors of the Company agreed to issue/ratify
the issue of 5,387,500 options under the 2006 Incentive Option Plan to officers,
employees and consultants as follows:
 
 (i)
              300,000
      options which will vest 1/3 on September 10, 2009, 1/3 on September 10,
      2010 and the balance on September 10, 2011 and 50% have an exercise price
      of US$0.444 per option and 50% have an exercise price of US$1.00 per
      option. An external consultant has calculated the fair value of the
      options using the Binomial valuation method using a share price of
      US$1.25, strike price as set out above, maturity period of 5.5 to 6.5
      years depending on the vesting date, risk free interest rate of 4.637% and
      volatility of 60%. This equates to values ranging from US$0.79 to US$1.01
      per option depending on the exercise price and vesting
      date.  The total value of the options equates to
      A$272,035;
 
 (ii)
              300,000
      options which will vest 1/3 on December 19, 2009, 1/3 on December 19, 2010
      and the balance on December 19, 2011 and 50% have an exercise price of
      US$0.444 per option and 50% have an exercise price of US$1.00 per option.
      An external consultant has calculated the fair value of the options using
      the Binomial valuation method using a share price of US$0.95, strike price
      as set out above, maturity period of 5.5 to 6.5 years depending on the
      vesting date, risk free interest rate of 4.441% and volatility of 60%.
      This equates to values ranging from US$0.54 to US$0.72 per option
      depending on the exercise price and vesting date.  The total
      value of the options equates to A$183,806;
and
  25
  (iii)
              4,787,500
      options which will vest 1/3 on December 28, 2009, 1/3 on December 28, 2010
      and the balance on December 28, 2011 and have an exercise price of US$1.00
      per option. An external consultant has calculated the fair value of the
      options using the Binomial valuation method using a share price of
      US$1.09, strike price as set out above, maturity period of 5.5 to 6.5
      years depending on the vesting date, risk free interest rate of 4.488% and
      volatility of 60%. This equates to values ranging from US$0.65 to US$0.69
      per option depending on the exercise price and vesting
      date.  The total value of the options equates to
      A$3,386,185.
 
 Dividend
Policy
  The
Company has not previously paid any cash dividends on Common Stock and does not
anticipate or contemplate paying dividends on Common Stock in the foreseeable
future. It is the present intention of management to utilize all available funds
for the development of the Company's business. The only restrictions that limit
the ability to pay dividends on common equity or that are likely to do so in the
future, are those restrictions imposed by law. Under Delaware corporate law, no
dividends or other distributions may be made which would render the Company
insolvent or reduce assets to less than the sum of its liabilities plus the
amount needed to satisfy any outstanding liquidation preferences.
 
 Effective
November 17, 2006, the Company’s Board of Directors declared a 1-for-2 share
bonus issue in the form of a dividend that was payable in December 2006 to
stockholders of record as of November 17, 2006.  An aggregate of
27,599,722 shares of Common Stock were issued in connection with this
dividend.
 
 In
November 2006, the Company’s Board of Directors declared a second 1-for-2 share
bonus issue in the form of a dividend that was payable in January 2007 to
stockholders of record as of December 31, 2006.  An aggregate of
41,934,337 shares of Common Stock were issued in connection with this
dividend.
 
 Transfer
Agent
 
 The
transfer agent and registrar for the Company's Common Stock is Continental Stock
Transfer & Trust Company of 17 Battery Place, 8th Floor,
New York, NY 10004.
 
 Recent
Sales of Unregistered Securities
 
 We have
issued no unregistered securities within the period covered by this report which
have not been previously reported on Form 10-QSB or Form 8-K except for the
following.
 
 Effective
December 31, 2007 the Company agreed to issue 200,000 shares of Common Stock for
services rendered to us and 150,000 shares of Common Stock for consulting
services. The securities were issued in reliance upon exemption from the
registration requirements of the Securities Act of 1933, as amended under
section 4(2) of the Act and/or under regulations promulgated under the
Act.
 
 26
  Item 6.
              Selected
      Financial Data.
 
 Our
selected financial data presented below for each of the years in the five-year
period ended December 31, 2007, and the balance sheet data at December 31, 2007
has been derived from financial statements, which have been audited by PKF,
Certified Public Accountants, a Professional Corporation.  The
selected financial data should be read in conjunction with our financial
statements for each of the years in the five year period ended December 31, 2007
and Notes thereto, which are included elsewhere in this Annual
Report.
 
 Statement
of Operations Data
 
 Year ended December
31
 2006
              
              
              2007
              
              
              2007
                Conv.
                TranslA$000s
              
              
              
              A$000s
              
              
              US$000sRevenues
              
              
              -
              
              
              
              -
              
              
              
              -Other
      income (loss)
              
              
              2
              
              
              
              22
              
              
              
              19Costs
      and expenses
              
              
              (4,537
              )
              
              
              (8,540
              )
              
              
              (7,487
              )Loss
      from operations
              
              
              (4,535
              )
              
              
              (8,518
              )
              
              
              (7,468
              )Other
      income (loss)
              
              
              (40
              )
              
              
              (120
              )
              
              
              (105
              )Profit
      (loss) before income
                taxes
              
              
              (4,575
              )
              
              
              (8,638
              )
              
              
              (7,573
              )Provision
      for income taxes
              
              
              -
              
              
              
              -
              
              
              
              -Net
      profit (loss)
              
              
              (4,575
              )
              
              
              (8,638
              )
              
              
              (7,573
              )A$
              
              
              
              A$
              
              
              $USNet
      profit (loss) per share
                on
      continuing operations
              
              
              (0.06
              )
              
              
              (0.06
              )
              
              
              (0.05
              )Weighted
      average number
                of
      shares outstanding (000s)
              
              
              75,230
              
              
              
              146,740
              
              
              
              146,740Balance
      Sheet DataA$000s
              
              
              
              A$000s
              
              
              US$000sTotal
      assets
              
              
              1,149
              
              
              
              17,994
              
              
              
              15,776Total
      liabilities
              
              
              1,881
              
              
              
              1,035
              
              
              
              908Stockholders’
      equity (deficit)
              
              
              (732
              )
              
              
              16,959
              
              
              
              14,868
  27
   Item 7.
              Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operation.
 
 General
 
 The
following discussion and analysis of our financial condition and plan of
operation should be read in conjunction with the Financial Statements and
accompanying notes and the other financial information appearing elsewhere in
this report.  This report contains numerous forward-looking statements
relating to our business. Such forward-looking statements are identified by the
use of words such a s believes, intends, expects, hopes, may, should, plan,
projected, contemplates, anticipates or similar words. Actual operating
schedules, results of operations, ore grades and mineral deposit estimates and
other projections and estimates could differ materially form those projected in
the forward-looking statements.
 
 We are an
exploration stage mining company.  Our principal exploration target is
for phosphate. We are in the initial stages of our exploration program and we
have not yet identified any ore reserves.  We have not generated any
material revenues from operations
 
 Foreign
Currency Translation
 
 The
majority of our administrative operations are in Australia and, as a result, our
accounts are reported in Australian dollars. The income and expenses of its
foreign operations are translated into Australian dollars at the average
exchange rate prevailing during the period. Assets and liabilities of the
foreign operations are translated into Australian dollars at the period-end
exchange rate. The following table shows the period-end rates of exchange of the
Australian and US dollar compared with the US dollar during the periods
indicated.
  Year
      endedDecember
      312006
                
                
                A$1.00
                
                =
                
                
                US$0.78932007
                
                
                A$1.00
                
                =
                
                
                US$0.8767
 The
exchange rate between the A$ and US$ has moved by 11.07% between December 31,
2006 and 2007.  Accordingly, a direct comparison of costs between
fiscal 2006 and 2007 may not necessarily be a true comparison.
 
 Plan
of Operation
 
 We have
A$17,088,190 in cash at December 31, 2007.
 
 We
commenced exploration activities on the tenements we acquired in July 2006 and
since that time and up to December 31, 2007, have spent A$8,943,385 on
exploration activities. We plan to continue our exploration program throughout
2008 and anticipate spending A$5,000,000 on exploration. However, if exploration
results are positive, we believe that we will be able to raise additional equity
capital in order to progress our exploration program at a faster
rate.
 
 As set out
in Item 1 “Employees” the services of our Chief Executive Officer, Chief
Financial Officer, General Manager Development and Resources, geologists,
finance and clerical employees are provided by AXIS.  At the current
time, we have no plans to change these arrangements or employ any further
persons.
 
 Results
of Operations
 
 Year
ended December 31, 2007 versus Year ended December 31, 2006
 
 Effective
November 17, 2006, Legend issued one (1) new bonus share of Common Stock for
every two (2) shares of Common Stock outstanding on the record at that date. The
issue of the new bonus shares of Common Stock were on a pro-rate basis to all
shareholders. As a result, the Company issued 27,599,722 shares of its Common
Stock. Effective December 31, 2006, Legend issued one (1) new bonus share of
Common Stock for every two (2) shares of Common Stock outstanding on the record
at that date. The issue of the new bonus shares of Common Stock were on a
pro-rata basis to all shareholders. As a result, the Company issued 41,934,337
shares of its Common Stock.
 
 28
  The
Company has accounted for these bonus issues as a stock split and accordingly,
all share and per share data has been retroactively restated.
 
 As an
exploration company, we do not have an ongoing source of revenue. Our revenue
stream is normally from ad-hoc tenement disposals and interest received on cash
in bank. During the year ended December 31, 2007, we received A$22,183
(US$19,448) in interest on funds in the bank (2006: A$1,930).
 
 Costs and
expenses increased during the year from A$4,536,507 for the year ended December
31, 2006 to A$8,539,934 (US$7,486,960) for the year ended December 31,
2007.
 
 The main
components of costs and expenses are as follows:-
 
 (i)
              An
      increase in exploration expenditure written off from A$3,811,385 in 2006
      to A$5,132,000 (US$4,499,224) in 2007. Our accounting policy is to expense
      all exploration costs (including costs associated with the acquisition of
      tenement interests) as incurred. During 2007, we incurred A$3,729,592 in
      costs for exploration drilling on our tenements in the Northern Territory.
      The costs included drilling, helicopter support, geological/geophysical
      contractors, salaries and associated costs for contract field staff,
      travel, accommodation, meals and tenement holding costs. During 2007, we
      used drillers almost continuously on our exploration program. In December
      2007, we entered into agreements to purchase exploration permits in
      Queensland. The purchase price of A$1,318,000 included cash of A$800,000,
      and shares with a value of A$518,000. The total cost has been expensed as
      part of exploration costs. We have spent A$84,408 since entering into the
      agreements on purchasing and reviewing data for the permits. In 2006, the
      Company acquired certain diamond mining tenements in Northern Australia
      for A$1,500,000, paid A$81,000 in stamp duty, A$921,131 of exploration
      expenditure incurred by Astro from February 1, 2006 to September 30, 2006
      and A$1,309,244 of exploration expenditure incurred since acquisition by
      the Company. All costs incurred in connection with this acquisition have
      been expensed as part of exploration costs. The Company commenced a
      drilling program on the tenement interests in the Northern Territory of
      Australia as soon as settlement of the acquisition of the tenements was
      completed.
 
 (ii)
              An
      increase in interest expense from A$41,371 in 2006 to A$62,196 (US$54,528)
      in 2007. During 2007, we incurred A$25,235 for interest on the camp lease;
      A$1,807 motor vehicle finance lease; A$14,683 charged by AXIS on
      outstanding amounts owing under the Service Agreement, which was repaid in
      June 2007; A$16,774 charged by Astro on amounts owed for exploration
      expenditure incurred by Astro, which was repaid in March 2007, and A$3,697
      for short term funds used to maintain the Company’s activities. AXIS
      provides management and geological services to us pursuant to a Service
      Agreement dated December 2004. AXIS and Astro charged interest at a rate
      of 10.10% during 2007. During 2006, we borrowed A$324,951 from Wilzed, a
      company which our President and CEO is a Director and shareholder and in
      October 2006, the total debt of A$336,081 was repaid. Wilzed charged us
      A$3,588 in interest at a rate between 9.35% to 9.85% during 2006. AXIS
      charged us A$13,498 in interest for 2006 at a rate between 9.35% to 10.10%
      during 2006 on accounts owing under the Service Agreement. Astro charged
      us A$21,302 in interest on amounts owed for exploration expenditure
      incurred by Astro.
 
 (iii)
              An
      increase in legal, professional and accounting from A$89,351 for 2006 to
      A$213,063 (US$186,792) for 2007. During 2007, we incurred legal expenses
      of A$91,483 for general legal work including stock transfer matters,
      regulatory filings, stock option plans and Form SB-2 Registration
      Statement; audit fees of A$62,049 for professional services in relation to
      financial statements, the quarterly Form 10-QSBs, Form 10-KSB, Form 10-K
      and Form SB-2; and A$59,531 for a stock transfer agent and regulatory
      filing fees. All fees have increased from 2006 as a result of increased
      activity by the Company as a consequence of the acquisition of mining
      tenements, capital raising activities and preparation of the Form SB-2
      Registration Statement. During 2006, we incurred legal expenses of
      A$28,295 in relation to general legal work including stock transfer
      matters, stock option plans and regulatory filings; audit fees of A$35,062
      for professional services in relation to financial statements, the
      quarterly Form 10-QSBs and Form 10-KSB; and A$25,993 for a stock transfer
      agent and regulatory filing fees.
  29
  (iv)
              An
      increase in administrative costs from A$479,093 in 2006 to A$2,753,365
      (US$2,413,875) in 2007. During 2007, the corporate management and service
      fees charged to us by AXIS was A$410,416 (US$359,812). AXIS charged us
      A$454,107 (US$398,116) for Directors’ fees, salaries  and salary
      related matters incurred in behalf of the Company, which relates to our
      share of salaries paid to the President & Chief Executive Officer,
      Chief Financial Officer and Secretary, General Manager Development and
      Resources, General Manager Business and other staff of AXIS who provide
      services to the Company. One independent Director charged directly to the
      Company the amount of A$20,000 for 2007. The Company paid insurance
      premiums of A$35,100 for 2007 compared to the 2006 premium was only for
      five months. The Company incurred A$282,648 (US$247,798) for travel by
      Directors and officers on capital raising trips, A$67,867 for travel of
      Directors, officers and support contractors to the field, A$534,268
      (US$469,269) for investor relations consultants and A$36,595 for tax
      matters, employee option valuation and exploration tenement maintenance;
      and A$13,443 for postage and freight charges. There was no comparable
      amount in 2006 for A$604,805 (US$530,233) for registration statement
      non-performance; A$111,197 for New York rent; A$49,256 for subscription to
      industry papers and services; A$15,564 for telecommunications support;
      A$14,751 for website maintenance; A$15,601 for depreciation of non-field
      assets and minor equipment purchases, A$8,238 for franchise tax, general
      costs of A$10,791 and A$8,791 for printing and stationery. AXIS charge
      A$120,000 for asset usage of plant and equipment of which $60,000 was
      charged to costs in 2007 and there was no comparable amount for 2006. The
      overall increase in administration costs related to the increase in
      activity by the Company as a consequence of providing support to a field
      exploration program from mid February 2007 to November 2007, capital
      raising activities, preparation of regulatory filings and Form SB-2
      Registration Statement. During 2006, the management fee charged by AXIS to
      us was $76,910. AXIS charged us A$75,410 for Director’s fees and salaries
      incurred on behalf of the Company. One independent Director charged
      directly to the Company the amount of A$35,000 for the period from the
      date of his appointment to December 31, 2006. The Company paid A$8,350 in
      insurance premiums for policies that commenced in August 2006. The Company
      incurred A$66,477 in travel and accommodation costs, A$61,878 in relation
      to travel by Directors and officers on capital raising trips and A$4,598
      for travel of support contractors to the field; A$193,513 for consultants,
      A$179,464 for investor relations consultants and A$14,049 for lodging
      annual tax returns, employee share option valuation and exploration
      tenement maintenance; A$8,350 for postage and freight costs; A$11,351 for
      motor vehicle costs related to the motor vehicle proposals for the field
      program.
  (v)
              Stock
      based compensation has increased from A$115,307 for 2006 to A$375,740
      (US$329,411) for 2007. The Company has issued options under the 2006
      Incentive Option Plan in September 2006, May 2007, September 2007 and
      December 2007. The increase is a result of additional options issued and
      includes an adjustment for forfeited options. See note 4 for further
      details on the options issued.
  Accordingly,
the loss from operations increased from A$4,534,577 for the year ended December
31, 2006 to A$8,517,751 (US$7,467,512) for the year ended December 31,
2007.
 
 There was
no provision for tax in either the prior year or the current year.
 
 The net
loss amounted to A$8,638,129 (US$7,573,047) for the year ended December 31,
2007, compared to a net loss of A$4,574,594 for the year ended December 31,
2006.
 
 The net
loss per common equivalent share in 2007 was A$0.06 (US$0.05) compared with a
net loss with a common equivalent share price of A$0.06 (US$0.05) in the prior
year.
 
 30
  Liquidity
and Capital Resources
 
 As of
December 31, 2007, the Company has cash of A$17,088,190
(US$14,981,216).
 
 On
December 12, 2007, we entered into a Subscription Agreement with Atticus
European Fund Ltd. and Green Way Managed Account Series Ltd. in respect of its
segregated account, Green Way Portfolio D (collectively “Atticus”) pursuant to
which the Company issued in a private placement transaction (the “Private
Placement”) to Atticus an aggregate of 18,750,000 shares of Common Stock at a
price of US$0.80 per share for an aggregate purchase price of US$15,000,000
(A$16,924,292).  We agreed to prepare and file with the Securities and
Exchange Commission a registration statement covering the resale of the shares
of Common Stock, which registration statement was filed on February 13,
2008.
 
 During
fiscal 2007, net cash used in operating activities was A$7,048,738
(US$6,179,629), as compared to A$4,125,135 in 2006, reflecting the commencement
of the Company’s diamond exploration activities in 2006.
 
 During
fiscal 2007, net cash provided by financing activities was A$23,435,853
(US$20,546,212) which represented the proceeds of private placements offering of
shares of Common Stock and repayment of short term financing facilities, as
compared to A$4,977,205 in 2006.
 
 We
commenced exploration activities on the tenements we acquired in July 2006 and
since that time and up to December 31, 2007, have spent A$8,943,385 on
exploration activities which includes the amounts paid in connection with our
Astro acquisition and purchase of exploration permits in Queensland. We plan to
continue our exploration program throughout 2008 and anticipate spending
A$5,000,000 on exploration. However, if exploration results are positive, we
believe that we will be able to raise additional equity capital in order to
progress our exploration program at a faster rate. In addition, we expect that
we will need to spend $2,000,000 on legal, professional, accounting and
administration expenses. The Company will need to raise funds in cash to fund
its business plan.  The Company plans to satisfy its cash requirements
by additional equity financing or loans. This will be in the form of private
placements of restricted Common Stock, preferred stock or debentures. The
Company may not be able to operate if it does not obtain the additional capital
or financing it requires. There can be no assurance that the Company will be
successful in raising such capital or financing and thus, be able to satisfy its
cash requirements.
 
 The
Company is considered to be an exploration stage company, with no significant
revenue, and is dependent upon the raising of capital through placement of its
Common Stock, preferred stock or debentures. In the event the Company is
unsuccessful in raising such capital, it may never commence active
operations.
 
 
 Impact
of Recent Accounting Pronouncements
 
 For a
discussion of the impact of recent accounting pronouncements on the Company’s
annual financial statements, see Note 2 to the Company’s Financial Statements
which are included herein.
 
 Item 7A.
              Quantitative
      and Qualitative Disclosures About Market
Risk.
 
 At
December 31, 2007, the Company had no outstanding Loan Facilities.
 
 Item 8.
              Financial
      Statements and Supplementary Data.
 
 See the
Financial Statements beginning on page F-1.
  31
  Item 9.
              Changes
      in and Disagreements With Accountants on Accounting and Financial
      Disclosure.
 
 There have
been no changes in accountants or any disagreements with accountants on any
matter of accounting principles or practices or financial statement disclosures
during the two years ended December 31, 2007.
 
 Item 9A.
              Controls
      and Procedures.
 
 (a)
              Evaluation
      of disclosure controls and
procedures.
  Our
principal executive officer and our principal financial officer evaluated the
effectiveness of our disclosure controls and procedures (as defined in Rule
13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 as amended) as of
the end of the period covered by this report.   Based on that
evaluation, such principal executive officer and principal financial officer
concluded that, the Company’s disclosure control and procedures were effective
as of the end of the period covered by this report.
 
 (b)
              Management's
      Report on Internal Control over Financial
  Reporting.
  Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting, as such term is defined in Exchange Act Rules
l3a-15(f) under the Securities Exchange Act of 1934, as amended. Under the
supervision of management and with the participation of our management,
including our principal executive officer and principal financial officer, we
conducted an evaluation of the effectiveness of our internal control over
financial reporting based on [the framework in Internal Control-Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission. Based on our evaluation of internal Control over financial
reporting, our management concluded that our internal control over financial
reporting was effective as of December 31, 2007.
 
 (c)
              Change
      in Internal Control over Financial
Reporting.
  No change
in our internal control over financial reporting occurred during our most recent
fiscal quarter that has materially affected, or is reasonably likely to
materially affect our internal control over financial reporting.
 
 (d)
              We
      believe that a controls system, no matter how well designed and operated,
      can not provide absolute assurance that the objectives of the controls
      system, no matter how well designed and operated, can not provide absolute
      assurance that the objectives of the controls system are met, and no
      evaluation of controls can provide absolute assurance that all control
      issues and instances of fraud, if any, within a company have been
      detected.
 
 Item 9B.
              Other
      Information.
 
 None.
 
 32
  PART III
  Item 10.
              Directors,
      Executive Officers and Corporate
Governance.
 
 The
following table sets out certain information concerning the Company’s executive
officers and directors.
  Name
                
                Age
                
                Position(s)
      HeldJoseph
      Gutnick
                
                55
                
                Chairman
      of the Board
                  President,
      Chief Executive Officer and Director.David
      Tyrwhitt
                
                69
                
                DirectorPeter
      Lee
                
                50
                
                Secretary,
      Chief Financial Officer and Principal Accounting
  Officer.Craig
      Michael
                
                30
                
                General
      Manager Development and
Resources




Joseph
Gutnick
 Mr.
Gutnick has been Chairman of the Board, President and Chief Executive Officer
since November 2004 and has been Chairman of the Board, President and Chief
Executive Officer of numerous public listed companies in Australia and the USA
specialising in the mining sector since 1980 and is currently a Director of
Quantum Resources Limited.  Mr. Gutnick was previously been a Director
of the World Gold Council.  He is a Fellow of the Australasian
Institute of Mining & Metallurgy and the Australian Institute of Management
and a Member of the Australian Institute of Company Directors.
 
 David
Tyrwhitt
 
 Dr
Tyrwhitt was appointed a Director in March 2005. He is a geologist, holding a
Bachelor of Science and PhD degrees and has 46 years experience in mineral
exploration and management development and operation of gold mines in
Australia.  Dr Tyrwhitt has been a Director of numerous public listed
companies in Australia in the mining industry and is currently a Director of
Astro Diamond Mines N.L., Great Gold Mines N.L., and Quantum Resources Limited
and has also been a Director of Golden River Resources Corp, a Delaware
corporation (GORV.OB) since 1996.
 
 Peter
Lee
 
 Mr Lee has
been Chief Financial Officer since March 2005 and Secretary since November
2004.  He is a Director, Chief Financial Officer and Secretary of
Golden River Resources Corp, a Delaware corporation (GORV.OB).  Mr Lee
is a Member of the Institute of Chartered Accountants in Australia, a Fellow of
Chartered Secretaries Australia Ltd., a Member of the Australian Institute of
Company Directors and holds a Bachelor of Business (Accounting) from Royal
Melbourne Institute of Technology. He has over 25 years commercial experience
and is currently General Manager Corporate and Company Secretary of several
listed public companies in Australia.
 
 Craig
Michael
 
 Mr.
Michael has 8 years experience in the mining and resources industry. His
previous work was with Oxiana Ltd where he was based in Laos in a
Supervisor/Trainer role, both as a Mine Geologist and Resource Geologist at the
Sepon Copper Gold Project. He was responsible for the geological interpretation
ofthe Khanong copper-gold deposit and the surrounding oxide and primary gold
deposits. In conjuction with training the national geologic staff in all mining
and resource geology functions Mr. Michael also conducted resource estimates for
public reporting. Prior to his time with Oxiana, he was a Mine Geologist at Sons
of Gwalia’s Carosue Dam Gold Project in Western Australia where he also
conducted his honours thesis on their flagship Karari gold deposit.
  33
  Involvement
on Certain Material Legal Proceedings During the Last Five Years
 
 No
director, officer, significant employee or consultant has been convicted in a
criminal proceeding, exclusive of traffic violations.  No director,
officer, significant employee or consultant has been permanently or temporarily
enjoined, barred, suspended or otherwise limited from involvement in any type of
business, securities or banking activities. No director, officer or significant
employee has been convicted of violating a federal or state securities or
commodities law.
 
 Board
of Directors
 
 Our
Certificate of Incorporation provides that there must be at least one Director
of the Company.  Our Board of Directors currently consists of two
directors.
 
 Directors
need not be stockholders of the Company or residents of the State of
Delaware.  Directors are elected for an annual term and generally hold
office until the next Directors have been duly elected and
qualified.  Directors may receive compensation for their services as
determined by the Board of Directors. A vacancy on the Board may be filled by
the remaining Directors even though less than a quorum remains.  A
Director appointed to fill a vacancy remains a Director until his successor is
elected by the Stockholders at the next annual meeting of Shareholder or until a
special meeting is called to elect Directors.
 
 The
executive officers of the Company are appointed by the Board of
Directors.  There are no family relationships between any Directors or
executive officers of the Company other than as disclosed.
 
 Our Board
of Directors consists of two members, of whom one has been, and continues to be,
independent under applicable regulations. During fiscal 2007, our Board of
Directors met four times. The Board of Directors also uses resolutions in
writing to deal with certain matters and during fiscal 2007, six resolutions in
writing were signed by all Directors.
 
 The
Company encourages all Directors to attend the Annual Meeting of stockholders,
either in person or by telephone. The Directors did not attend the 2007 Annual
Meeting as they were overseas on business.
 
 Nominating
Committee
 
 We do not
have a nominating committee. Historically our entire Board has selected nominees
for election as directors. The Board believes this process has worked well thus
far particularly since it has been the Board's practice to require unanimity of
Board members with respect to the selection of director nominees. In determining
whether to elect a director or to nominate any person for election by our
stockholders, the Board assesses the appropriate size of the Board of Directors,
consistent with our bylaws, and whether any vacancies on the Board are expected
due to retirement or otherwise. If vacancies are anticipated, or otherwise
arise, the Board will consider various potential candidates to fill each
vacancy. Candidates may come to the attention of the Board through a variety of
sources, including from current members of the Board, stockholders, or other
persons.  The Board of Directors has not yet had the occasion to, but
will, consider properly submitted proposed nominations by stockholders who are
not directors, officers, or employees of Legend on the same basis as candidates
proposed by any other person.
 
 Audit
and Compensation Committees
 
 We do not
have an Audit Committee or a Compensation Committee as we only have two
Directors, only one of whom (Dr. Tyrwhitt) may be deemed to be
independent.  However, Dr Tyrwhitt liaises directly with the auditors
on matters normally dealt with by an Audit Committee. It is the opinion of the
Board of Directors that Mr. Tyrwhitt is an independent director as defined in
Rule 10A-3 of the Securities Exchange Act of 1934. In addition, the Board
believes that Mr. Tyrwhitt would meet the director independence requirements of
the Nasdaq Stock Market if we were listed on such Market. Our Board does not
include a "financial expert" as defined in Item 407 of Regulation S-K. The
Company only has one independent Director and this Director does not have a
finance background.
  34
  Executive
and Director compensation matters are determined by the entire Board of
Directors.
 
 Code
of Ethics
 
 We have
adopted a Code of Conduct and Ethics and it applies to all Directors, Officers
and employees.  A copy of the Code of Conduct and Ethics will be
posted on our website and we will provide a copy to any person without
charge.  If you require a copy, you will be able to download it from
our website at www.lgdi.net or
alternatively, contact us by facsimile or email and we will send you a
copy.
 
 Stockholder
Communications with the Board
 
 Stockholders
who wish to communicate with the Board of Directors should send their
communications to the Chairman of the Board at the address listed below. The
Chairman of the Board is responsible for forwarding communications to the
appropriate Board members.
 
 Mr. Joseph
Gutnick
 Legend
International Holdings, Inc.
 PO Box
6315 St Kilda Road
 Central
Melbourne, Victoria 8008 Australia
 
 Section
16(a) Beneficial Ownership Reporting Compliance
 
 Pursuant
to Section 16(a) of the Securities Exchange Act of 1934, our Directors,
executive officers and beneficial owners of more than 10% of the outstanding
Common Stock are required to file reports with the Securities and Exchange
Commission concerning their ownership of and transactions in our Common Stock
and are also required to provide to us copies of such reports.  Based
solely on such reports and related information furnished to us, we believe that
in fiscal 2007 all such filing requirements were complied with in a timely
manner by all Directors and executive officers and 10% stockholders, except that
Mr. Gutnick and Renika Pty Ltd. filed one Form 4 in connection with the sale of
stock and Mr. Gutnick filed one Form 4 with respect to the receipt of options.
Mr Lee filed two Form 4’s in connection with the receipt of options and Mr
Michael filed a Form 3 and two Form 4’s in connection with the receipt of
options after the respective due dates of such forms.
 
 Item 11.
              Executive
      Compensation.
 
 The
following table sets forth the annual salary, bonuses and all other compensation
awards and pay outs on account of our Chief Executive Officer for services
rendered to us during the fiscal years ended December 31, 2006 and 2007, and for
our Chief Financial Officer and General Manager Development and Resources for
2007.  No other executive officer received more than US$100,000 per
annum during this period.
  Summary
Compensation Table
  Name
      and Principal Position
                  
                  Year
                  
                  
                  Salary
      (A$)
                  
                  
                  Bonus
      (A$)
                  
                  
                  Stock
                    Awards
                    (A$)
                  
                  
                  Option
                    Awards
                    (A$)
                  
                  
                  Non-Equity
      Incentive Plan Compensation (A$)
                  
                  
                  Change
      in Pension Value and Nonqualified Deferred Compensation Earnings
      (A$)
                  
                  All
      Other Compensation
                    (A$)
                  
                  
                  Total
                    (A$)Joseph
      Gutnick,Chairman
      of theBoard,
      President and
                  
                  
                  2007
                  
                  
                  
                  82,132
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  86,764
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  26,768
                  
                  
                  
                  195,664CEO
                  
                  
                  2006
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  28,892
                  (i)
                  
                  
                  -
                  
                  
                  
                  -
                  
                  -
                  (ii)
                  
                  
                  28,892Peter
      Lee, CFO & Secretary
                  
                  2007
                  
                  
                  
                  115,400
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  65,501
                  (i)
                  
                  
                  -
                  
                  
                  
                  -
                  
                  38,825
                  (ii)
                  (iii)
                  
                  219,726Craig
      Michael, Gen Mgr,  Development & Resources
                  
                  2007
                  
                  
                  
                  48,988
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  59,341
                  (i)
                  
                  
                  -
                  
                  
                  
                  -
                  
                  11,948
                  (ii)
                  
                  
                  120,277




35




(i)
              The
      amounts included in the table for option awards has been calculated in
      accordance with SFAS 123R.
 (ii)
              Includes
      share of superannuation contributions made by AXIS applicable to salaries
      charged to the Company.
 (iii)
              Includes
      share of cost of motor vehicle costs made by AXIS applicable to Mr Lee as
      charged to the Company.
 
 The
services of our Chief Executive Officer, Chief Financial Officer & Secretary
and General Manager Development and Resources are provided to us pursuant to a
Service Agreement effective December 1, 2004 (the “Service Agreement”) by and
between AXIS Consultants Pty Limited and ourselves.
 
 Outstanding
Equity Awards at Fiscal Year-End




Option
      Awards
              Stock
      AwardsName
              Number
      of Securities Underlying Unexercised Options (#)
    Exercisable
              Number
      of Securities Underlying Unexercised Options (#)
    Unexercisable
              Equity
      Incentive Plan Awards: Number of Securities Underlying Unexercised
      Unearned Options (#)
              Option
      Exercise Price ($)
              Option
      Expiration Date
              Number
      of Shares or Units of Stock That Have Not Vested (#)
              Market
      Value of Shares or Units of Stock That Have Not Vested ($)
              Equity
      Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights
      That Have Not Been Vested (#)
              Equity
      Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or
      Other Rights That Have Not Vested ($)Joseph
      Gutnick,Chairman
      of theBoard,
      President andCEO
              -
              -
              2,250,000
              US$1.00
              9/19/16
              -
              -
              -
              -Peter
      Lee,
              -
              -
              787,500
              US$0.444
              9/19/16
              -
              -
              -
              -CFO
      and
              -
              -
              787,500
              US$1.00
              9/19/16
              -
              -
              -
              -Secretary
              -
              -
              1,000,000
              US$1.00
              12/28/17
              -
              -
              -
              -Craig
      Michael,General Manager,
              -
              -
              150,000
              US$0.444
              9/10/17
              -
              -
              -
              -Development
      &
              -
              -
              150,000
              US$1.00
              9/10/17
              -
              -
              -
              -Resources
              -
              -
              1,250,000
              US$.100
              12/28/17
              -
              -
              -
              -




2006
Equity Incentive Plan
 
 The 2006
Plan provides for the granting of options. The maximum number of shares
available for awards is 10% of the issued and outstanding shares of Common Stock
on issue at any time.  If an option expires or is cancelled without
having been fully exercised or vested, the remaining shares will generally be
available for grants of other awards.
 
 The 2006
Plan is administered by the Board comprised solely of directors who are not
employees or consultants to Legend or any of its affiliated
entities.
 
 Any
employee, director, officer, consultant of or to Legend or an affiliated entity
(including a company that becomes an affiliated entity after the adoption of the
2006 Plan) is eligible to participate in the 2006 Plan if the Committee, in its
sole discretion, determines that such person has contributed significantly or
can be expected to contribute significantly to the success of Legend or an
affiliated entity. During any one year period, no participant is eligible to be
granted options to purchase more than 5% shares of our issued and outstanding
Common Stock or if they provide investor relations activities, or are a
consultant to the Company, 2% of the issued and outstanding shares of Common
Stock in any 12 month period.
 
 Options
granted under the 2006 Plan are to purchase Legend Common Stock.  The
term of each option will be fixed by the Board, but no option will be
exercisable more than 10 years after the date of grant.  The option
exercise price is fixed by the Board at the time the option is
granted.  The exercise price must be paid in cash. Options granted to
participants vest and have a term of 10 years.
 
 36
  No award
is transferable, or assignable by the participant except upon his or her
death.
 
 The Board
may amend the 2006 Plan, except that no amendment may adversely affect the
rights of a participant without the participant’s consent or be made without
stockholder approval if such approval is necessary to qualify for or comply with
any applicable law, rule or regulation the Board deems necessary or desirable to
qualify for or comply with.
 
 Subject to
earlier termination by the Board, the 2006 Plan has an indefinite term except
that no ISO may be granted following the tenth anniversary of the date the 2006
Plan is approved by stockholders.
 
 Other than
the issue of these Options, there are no other current plans or arrangements to
grant any options under the 2006 Plan.
 
 Compensation
Pursuant to Plans
 
 The
Company does not have any pension or profit sharing plans.  The
Company does not have any employees and therefore has no superannuation
obligations.
 
 Equity
Compensation Plan Information
 
 The
following table sets forth, as of December 31, 2007, information regarding
options under our 2006 stock option plan, our only active plan.  The
2006 stock option plan has been approved by our
stockholders.  Outstanding options under this plan that are forfeited
or cancelled will be available for future grants.  All of the options
are for the purchases of our Common Stock.
  Number
      of Securities to be
                  issued
      upon exercise of
                  outstanding
      options,
                  warrants and rights
                
                
                Weighted-average
                  exercise
      price of
                  outstanding
      options,
                  warrants and rights
                
                
                Number
      of securities remaining
                  available
      future issuance under
                  equity
      compensation (excluding
                  securities
      reflected in Column
    One)Equity
      compensation plans approved by security holders
                
                
                12,587,500
                
                
                
                A$0.8820
                
                
                
                5,119,326Equity
      compensation plans not approved by security holders
                
                
                -
                
                
                
                -
                
                
                
                -




Director
Compensation
  Name
                
                Fees
      Earned or
                  Paid
      in
                  Cash
      (A$)
                
                
                Stock
                  Awards
      ($)
                
                
                Option
                  Awards
      ($)
                
                
                Non-Equity
      Incentive Plan Compensation
                  ($)
                
                
                Change
      in
                  Pension
      Value
                  and
                  Nonqualified
      Deferred Compensation Earnings
                
                
                All
      Other Compensation
                  ($)
                
                
                Total
      (A$)David
      Tyrwhitt
                
                
                20,000
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                20,000




It is our
policy to reimburse Directors for reasonable travel and lodging expenses
incurred in attending Board of Directors meetings.  Commencing January
2005, non-management Directors are paid Directors fees of A$20,000 per
annum.
   Item 12.
              Security
      Ownership of Certain Beneficial Owners and Management and Related
      Stockholder Matters.
 
 The
following table sets out, to the best of our knowledge, the numbers of shares in
us beneficially owned as at December 31, 2007 by:
  37
  (i)
              each
      of our present Executive Officers and
Directors,
 
 (ii)
              each
      person (including any “group” as that term is defined in Section 13(d)(3)
      of the Securities  Exchange Act) who beneficially owns more than
      5% of our Common Stock, and
 
 (iii)
              all
      of our present Directors and officers as a
  group.




Title
      of Class
              Name
              
              Number
      of Shares Owned
              
              
              Percentage
      of Shares (1)Shares
      of Common Stock
              Joseph
      and Stera Gutnick *
              
              
              84,426,726
              
              
              
              (2
              )(3)(4)(5)
              
              
              47.68Shares
      of Common Stock
              David
      Tyrwhitt *
              
              
              -
              
              
              
              
              
              
              
              -Shares
      of Common Stock
              Peter
      Lee *
              
              
              525,000
              
              
              
              (6
              )
              
              
              **Shares
      of Common Stock
              Craig
      Michael
              
              
              -
              
              
              
              (7
              )
              
              
              -All
      officers and DirectorsAs a
      Group
              
              
              84,951,726
              
              
              
              
              
              
              
              47.98767
      Fifth Avenue –12th Fl.New
      York, NYShares
      of Common Stock
              10153
              
              
              17,606,901
              
              
              
              (8
              )
              
              
              9.94Shares
      of Common Stock
              Green
      Way
                Portfolio
      D
                767
      Fifth Avenue –
                12th
      Fl.
                New
      York, NY
                10153
              
              
              1,143,099
              
              
              
              (8
              )
              
              
              0.65




*
              unless
      otherwise indicated, the address for each person is C/- Legend
      International Holdings, Inc., Level 8, 580 St Kilda Road, Melbourne,
      Victoria 3004, Australia.
 **
              less
      than 1%
 
 Notes
relating to Item 11:
 
 (1)
              Based
      on 177,068,825 shares outstanding as of December 31,
  2007.
 
 (2)
              Includes
      63,775,476 shares of Common Stock owned by Renika Pty. Ltd., of both of
      which Mr Joseph Gutnick, Stera M. Gutnick and members of their family are
      officers, Directors and principal
stockholders.
 
 (3)
              Includes
      750,000 shares issuable to Mr Joseph Gutnick upon exercise of stock
      options of which vested on September 19, 2007. Mr Gutnick holds a further
      750,000 options which vest on September 19, 2008 and 750,000 options which
      vest on September 19, 2009. Does not include 1,666,667 options which are
      exercisable on February 7, 2009, 1,666,667 options which are exercisable
      on February 7, 2010, 1,666,667 options which are exercisable on February
      7, 2011.
  (4)
              Joseph
      Gutnick and Stera Gutnick are husband and
wife.
 
 (5)
              Includes
      19,901,250 shares of Common Stock owned by Chabad House of Caulfield Pty
      Ltd. (“Chabad House”), a private corporation that is the trustee of the
      Heichal Menachem Community Centre Fund, a charitable organization. Joseph
      Gutnick and Stera Gutnick are directors of Chabad House but disclaim any
      beneficial interest in the shares of Common Stock owned by Chabad
      House.
  (6)
              Includes
      525,000 shares issuable to Mr Peter Lee upon exercise of stock options of
      which vested on September 19, 2007. Mr Lee holds a further 525,000 options
      which vest on September 19, 2008, 333,333 options which vest on December
      28, 2009  525,000 options which vest on September 19, 2009,
      333,333 options which vest on December 28, 2009, 333,333, options which
      vest on December 28, 2010 and 333,334, options which vest on December 28,
      2011.
  38
  (7)
              Does
      not include 100,000 options which vest on September 10, 2009, 416,666
      options which vest on December 28, 2009  100,000 options which
      vest on September 10, 20010, 416,667 options which vest on December 28,
      2010, 100,000, options which vest on September 10, 2011 and 416,667,
      options which vest on December 28,
2011.
 
 (8)
              In
      accordance with a Form 3/A dated January 3, 2008, Atticus Capital L.P.,
      Atticus Management Limited and Mr. Timothy Barakett may be deemed to be
      beneficial owners of the shares of Common
Stock.
  Item 13.
              Certain
      Relationships and Related Transactions, and Director
      Independence.
 
 In
December 2004, the Company entered into an agreement with AXIS Consultants Pty
Ltd to provide geological, management and administration services to the
Company.  AXIS is affiliated through common management. We are one of
four affiliated companies.  Each of the companies has some common
Directors, officers and shareholders.  In addition, each of the
companies is substantially dependent upon AXIS for its senior management and
certain mining and exploration staff.  A number of arrangements and
transactions have been entered into from time to time between such
companies.  It has been the intention of the affiliated companies and
respective Boards of Directors that each of such arrangements or transactions
should accommodate the respective interest of the relevant affiliated companies
in a manner which is fair to all parties and equitable to the shareholders of
each. Currently, there are no material arrangements or planned transactions
between the Company and any of the other affiliated companies other than
AXIS.
 
 AXIS is a
company owned by its public companies (including Legend) and any profits
generated by AXIS are returned to its shareholders in the form of
dividends.
 
 AXIS is
paid by each company for the costs incurred by it in carrying out the
administration function for each such company.  Pursuant to the
Service Agreement, AXIS performs such functions as payroll, maintaining employee
records required by law and by usual accounting procedures, providing insurance,
legal, human resources, company secretarial, land management, certain
exploration and mining support, financial, accounting advice and
services.  AXIS procures items of equipment necessary in the conduct
of the business of the Company.  AXIS also provides for the Company
various services, including but not limited to the making available of office
supplies, office facilities and any other services as may be required from time
to time by the Company as and when requested by the Company.
 
 We are
required to reimburse AXIS for any direct costs incurred by AXIS for the
Company.  In addition, we are required to pay a proportion of AXIS’s
overhead cost based on AXIS’s management estimate of our utilisation of the
facilities and activities of AXIS plus a service fee of not more than 15% of the
direct and overhead costs. Amounts invoiced by AXIS are required to be paid by
us.  We are also not permitted to obtain from sources other than AXIS,
and we are not permitted to perform or provide ourselves, the services
contemplated by the Service Agreement, unless we first requests AXIS to provide
the service and AXIS fails to provide the service within one month.
 
 The
Service Agreement may be terminated by AXIS or us upon 60 days prior
notice.  If the Service Agreement is terminated by AXIS, we would be
required to independently provide, or to seek an alternative source of
providing, the services currently provided by AXIS.  There can be no
assurance that we could independently provide or find a third party to provide
these services on a cost-effective basis or that any transition from receiving
services under the Service Agreement will not have a material adverse effect on
us.  Our inability to provide such services or to find a third party
to provide such services may have a material adverse effect on our
operations.
 
 In
accordance with the Service Agreement AXIS provides the Company with the
services of our Chief Executive Officer, Chief Financial Officer, geologists and
clerical employees, as well as office facilities, equipment, administrative and
clerical services. We pay AXIS for the actual costs of such facilities plus a
maximum service fee of 15%.
 
 39
  During
2006, AXIS charged the Company A$203,664 in management fees and administration
services, A$212,679 for exploration services provided to the Company, charged
interest of A$13,498 on the outstanding balance, loaned us $4,500 and the
Company repaid A$180,000. AXIS charged interest at a rate of between 9.35% and
10.10% for 2006. AXIS did not charge a service fee for 2006. The amount owed to
AXIS at December 31, 2006 was A$312,253.  During 2007, AXIS charged
the Company A$1,126,311 in management fees including salaries incurred in
relation to AXIS staff that provided services to the Company, A$834,552 for
exploration services provided to the Company, A$151,800 for asset usage,
interest of A$14,683 and we repaid A$2,432,687. AXIS charged interest at a rate
of 10.10% for 2007. The amount owed to AXIS at December 31, 2007 was
A$6,912.
 
 On
December 14, 2004, the Company issued 20,250,000 options to Renika Pty Ltd
(“Renika”) as consideration for services to be rendered by the new President and
Chief Executive Officer of the Company.  The 20,250,000 options
convert to 20,250,000 shares of Common Stock at an exercise price of $0.022 and
a latest exercise date of December 2009.  The Company undertook a
Black Scholes valuation of the options using a $0.022 exercise price, $0.022
market price, 5 year life, risk free interest rate of 5.155% and a volatility of
16.7% which equated to a value of $123,300.  The $0.022 market price
was based on the price of the Company’s shares of Common Stock at the
time.  In the absence of any independent directors on the Company’s
Board, the Company’s sole director, Mr. Gutnick, appointed Dr. David Tyrwhitt to
approve the terms of the options on behalf of the Company.  In
September 2005, Renika exercised the 20,250,000 options using the cashless
exercise feature and were issued 17,085,937 shares of Common Stock.
 
 Wilzed Pty
Ltd, a company associated with President and CEO of the Company, Joseph Gutnick,
has paid expenses on behalf of the Company and has provided loan funds to enable
the Company to meet its liabilities. During the 2006 fiscal year, Wilzed loaned
A$324,951 and charged A$3,588 in interest, and we repaid $336,081. The amount
owed at December 31, 2006 was A$nil. Wilzed charged interest at a rate of
between 9.35% and 9.85% for 2006.
 
 Mr Joseph
Gutnick, the President of the Company advanced the Company the initial deposit
on opening a US Dollar bank account. In March, 2007, the balance of A$831, owing
of the initial advance of A$1,303 (US$1,000) less expenses incurred of A$472,
was repaid.
 
 Effective
as of March 3, 2006, Legend entered into a Contract for the Sale of Mining
Tenements (“Contract”) with Astro Diamond Mines N.L. (“Astro”) an Australian
company pursuant to which the Company acquired certain diamond mining tenements
in Northern Australia from Astro. The consideration payable by Legend to Astro
was A$1.5 million and Legend was also required to pay to Astro any costs
incurred on the tenements after February 1, 2006.  Astro provided
commercial warranties which are usual for a transaction of this nature in favour
of Legend. Under Australian law, Astro was required to provide an independent
experts report to shareholders for this transaction. In order to prepare the
independent experts report, a mineral valuation was prepared on behalf of Astro
which indicated that the preferred value for the tenements that are the subject
of the transaction was A$1.5 million. This formed the basis of the consideration
agreed by the parties. The President and Chief Executive Officer of the Company,
Mr. J. I. Gutnick, was Chairman and Managing Director of Astro and Dr DS
Tyrwhitt, an independent Director of the Company is also a Director of Astro.
The tenements are located in the Northern Territory of Australia and are
prospective for all minerals. Astro incurred costs on the mining tenements from
February 1, 2006 which at settlement Legend was required to pay. However, Astro
had not quantified the amount at the date of settlement. At December 31, 2006,
the Company owed Astro A$942,433 including interest of A$21,302. During 2007,
the amount was repaid in full including interest charge for 2007 of A$16,774.
Astro charged interest at a rate of 10.10% in 2007.
 
 The
Company appointed Mr. Mordechai Gutnick, as the Company’s General Manager,
Business in December, 2007.  Mr.  Gutnick is the son of
Joseph Gutnick, the Company’s President and Chairman of the
Board.  Mr. Mordechai Gutnick receives an annual salary paid via
AXIS.  In addition, in December, 2007, Mr. Mordechai Gutnick was
granted 2,000,000 stock options:
 
 40
  Transactions
with Management.
 
 We have a
policy that we will not enter into any transaction with an Officer, Director or
affiliate of us or any member of their families unless the transaction is
approved by a majority of our disinterested non-employee Directors and the
disinterested majority determines that the terms of the transaction are no less
favourable to us than the terms available from non-affiliated third parties or
are otherwise deemed to be fair to us at the time authorised.
 
 Item 14.
              Principal
      Accounting Fees and Services.
 
 The
following table shows the audit fees incurred for fiscal 2007 and
2006.
 
 2007
                A$
              
              
              
              2006
                A$Audit
      fees
              
              
              62,049
              
              
              
              35,062Audit
      related fees
              
              
              -
              
              
              
              -Tax
      fees
              
              
              2,994
              
              
              
              4,280Total
              
              
              65,043
              
              
              
              39,342
 
 Audit fees
were for the audit of our annual financial statements, review of financial
statements included in our 10-QSB/10-Q quarterly reports, and services that are
normally provided by independent auditors in connection with our other filings
with the SEC.  This category also includes advice on accounting
matters that arose during, or as a result of, the audit or review of our interim
financial statements.
 
 As part of
its duties, our Board of Directors pre-approves audit and non-audit services
performed by our independent auditors in order to assure that the provision of
such services does not impair the auditors’ independence.  Our Board
of Directors does not delegate to management its responsibilities to pre-approve
services performed by our independent auditors.
 
 41
 
 PART IV
    Item 15.
              Exhibits,
      Financial Statement Schedules.
 
 Documents
filed as part of the report.
 
 (1)
                All
      Financial StatementsPageReport
      of Independent Registered Public Accounting Firm
                
                
                F-1Balance
      Sheet
                
                
                F-2Statements
      of Operations
                
                
                F-3Statements
      of Stockholders’
      Equity
                
                
                F-4 – F-5Statements
      of Cash Flows
                
                
                F-6Notes
      to Financial Statements
                
                
                F-7 – F-21
  (2)
                Financial
      Statements ScheduleAll
      other schedules have been omitted because they are not applicable or not
      required, or because the required information is shown in the consolidated
      financial statements or notes thereto.(3)
                ExhibitsSee
      Index to Exhibits at page 46 for a description of the exhibits filed as a
      part of this report.




42




SIGNATURES
 
 
 Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, the Registrant has caused this Annual Report to be signed on its behalf by
the undersigned, thereunto duly authorised.
   LEGEND
      INTERNATIONAL HOLDINGS, INC.(Registrant)By:
                graphicPeter
      J LeeChief
      Financial Officer and SecretaryDated:
      March 17, 2008






43




FORM
10-K Signature Page
 
 
 Pursuant
to the requirements of the Securities Exchange Act of 1934, this Report has been
signed below by the following persons in the capacities and on the dates
indicated.
  Signature
                Title
                
                Date1.
      graphicJoseph
      Gutnick
                Chairman
      of the Board,President
      and Chief ExecutiveOfficer
      (Principal ExecutiveOfficer)
      and Director
                
                March
      17, 20082.
      graphicDavid
      Tyrwhitt
                Director
                
                March
      17, 20083.graphicPeter
      Lee
                Chief
      Financial Officer andSecretary
      (Principal Financialand
      Accounting Officer)
                
                March
      17, 2008




44




EXHIBIT
INDEX
 
 Incorporated
by
 Reference
to:
 
 Exhibit
      No.
              Exhibit1.1
              Subscription
      Agreement (1)3.1
              Certificate
      of Incorporation (1)3.2
              Amended
      Certificate of Incorporation (2)3.3
              Bylaws
      (1)3.4
              Specimen
      Stock Certificate (1)3.5
              Amendment
      to Certificate of Incorporation (5)10.1
              2006
      Incentive Option Plan (3)10.3
              Contract
      for the Sale of Mining Tenements (4)10.4
              Subscription
      Agreement dated as of December 12, 2007 (6)10.5
              Agreement
      with Iron Duketon Pty Limited dated November 2, 2007
(7)10.6
              Agreement
      with Ansett Resources & Industries Pty Ltd. dated November 7, 2007
      (7)10.7
              Agreement
      with King Eagle Resources Pty Limited dated December 7, 2007
      (8)21.1
              Subsidiaries
      of the Registrant (5)31.1
              Certification
      Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of
      the Sarbanes-Oxley Act of 2002 by Joseph Isaac Gutnick
  (6)31.2
              Certification
      of Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302
      of the Sarbanes-Oxley Act of 2002 by Peter James Lee
(6)32.1
              Certification
      of Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906
      of the Sarbanes-Oxley Act of 2002 by Joseph Isaac Gutnick
    (6)32.2
              Certification
      Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of
      the Sarbanes-Oxley Act of 2002 by Peter James Lee
  (6)
 
 Footnotes:
 
 (1)
              Incorporated
      herein by reference to the Company’s Registration Statement on Form SB-2,
      filed on February 2, 2001, File No. 333-55116, and the amendments
      thereto.
  (2)
              Incorporated
      herein by reference to the Company’s current report on Form 8-K filed on
      March 21, 2003.
  (3)
              Incorporated
      herein by reference to the Appendix to the Company’s Proxy Statement
      filed   on October 19,,
2006.
  (4)
              Incorporated
      by reference to the Company’s current report on Form 8-K filed on March
      10, 2006.
  (5)
              Filed
      herewith
  (6)
              Incorporated
      herein by reference to the Company’s Current Report on Form 8-K filed on
      December 19, 2007.
  (7)
              Incorporated
      herein by reference to the Company’s Current Report on Form 8-K filed on
      December 28, 2007.
  (8)
              Incorporated
      herein by reference to the Company’s Current Report on Form 8-K filed on
      December 28, 2007.
  45




Financial
Statements for the years ended December 31, 2006 and 2007.
 
 Legend
International Holdings, Inc.
 Audited
Financial Statements for the Company for the years ended December 31, 2007 and
2006.




46




LEGEND
INTERNATIONAL HOLDINGS, INC.
 (An
Exploration Stage Company)
 
 
 Financial
Statements
 
 December
31, 2007 and 2006
 
 (with
Report of Independent Registered Public Accounting Firm)




CONTENTS


PageReport
      of Independent Registered Public Accounting Firm
              
              
              F-1Balance
      Sheet
              
              
              F-2Statements
      of Operations
              
              
              F-3Statements
      of Stockholders’ Equity (Deficit)
              
              
              F-4 – F-5Statements
      of Cash Flows
              
              
              F-6Notes
      to Financial Statements
              
              
              F-7
      – F-21









Report of Independent
Registered Public Accounting Firm
 
 To the
Board of Directors and Stockholders of
 Legend
International Holdings, Inc
 
 We have
audited the accompanying balance sheet of Legend International Holdings, Inc (An
Exploration Stage Company) as of December 31, 2007, and the related statements
of operations, stockholders’ equity (deficit) and cash flows for the years ended
December 31, 2007 and 2006 and the cumulative amounts from inception, January 5,
2001 through December 31, 2007.  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 standards of the Public Company
Accounting Oversight Board (United States).  Those standards require
that we plan and perform the audit 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
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 Legend International Holdings, Inc.
at December 31, 2007, and the results of its operations and its cash flows for
the periods indicated above in conformity with accounting principles generally
accepted in the United States of America.
 
 The
accompanying financial statements have been prepared assuming the Company will
continue as a going concern.  As described in note 1, at December 31,
2007 the Company had not yet commenced revenue producing operations and had a
retained deficit of A$13,993,863. These conditions raise substantial doubt about
the Company’s ability to continue as a going concern.  The
consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty.  Management’s plans in
regard to these matters are also discussed in note 1.
  New
      York, NY
                PKFMarch
      13, 2008
                Certified
      Public AccountantsA
      Professional
Corporation




F-1




LEGEND
INTERNATIONAL HOLDINGS, INC.
 (An
Exploration Stage Company)
 Balance
Sheet
 December
31, 2007
 
 ASSETS2007
                  A$
                
                
                Convenience Translation
                  2007
                  US$Current
      Assets:Cash
                
                
                17,088,190
                
                
                
                14,981,216Receivables
                
                
                507,264
                
                
                
                444,718Prepayments
                
                
                110,840
                
                
                
                97,174Total
      Current Assets
                
                
                17,706,294
                
                
                
                15,523,108Non-Current
      Assets:Property
      and Equipment, net
                
                
                158,177
                
                
                
                138,674Deposits
      (note 10)
                
                
                130,000
                
                
                
                113,971Total
      Non-Current Assets
                
                
                288,177
                
                
                
                252,645Total
      Assets
                
                
                17,994,471
                
                
                
                15,775,753LIABILITIESCurrent
      Liabilities:Accounts
      payable and accrued expenses
                
                
                671,384
                
                
                
                588,602Lease
      liability
                
                
                273,740
                
                
                
                239,988Total
      Current Liabilities
                
                
                945,124
                
                
                
                828,590Non
      Current Liabilities:Reclamation
      and Remediation Provision (note 9)
                
                
                90,000
                
                
                
                78,903Total
      Non Current Liabilities
                
                
                90,000
                
                
                
                78,903Total
      Liabilities
                
                
                1,035,124
                
                
                
                907,493Commitments
      and Contingencies (Notes 8, 9 and 10)Stockholders’
      EquityCommon
      stock: US$.001 par value
                  300,000,000
      shares authorised177,068,825
      shares issued
                
                
                223,039
                
                
                
                195,538Additional
      Paid-in-Capital
                
                
                30,691,681
                
                
                
                26,907,397Other
      Comprehensive Gain
                
                
                38,490
                
                
                
                33,744Retained
      Deficit during development period
                
                
                (839,463
                )
                
                
                (735,957
                )Retained
      Deficit during exploration period
                
                
                (13,154,400
                )
                
                
                (11,532,462
                )Total
      Stockholders’ Equity
                
                
                16,959,347
                
                
                
                14,868,260Total
      Liabilities and Stockholders’ Equity
                
                
                17,994,471
                
                
                
                15,775,753
 
 The
accompanying notes are integral part of the financial statements.
  F-2




LEGEND
INTERNATIONAL HOLDINGS, INC.
 (An
Exploration Stage Company)
 Statements
of Operations
  For
      the years Ended
                  December
      31
                
                
                Convenience
                  Translation
                
                
                January
      5, 2001 (Inception) to December 31,2006
                  A$
                
                
                
                2007
                  A$
                
                
                2007
                  US$
                
                
                
                2007
                  A$Revenues:Sales
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                6,353less
      cost of sales
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (1,362
                )Gross
      profit
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                4,991Other
      incomeInterest
      income – related entity
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -Interest
      income – other
                
                
                1,930
                
                
                
                22,183
                
                
                
                19,448
                
                
                
                26,0581,930
                
                
                
                22,183
                
                
                
                19,448
                
                
                
                31,049Costs
      and expenses:Legal,
      professional and accounting
                
                
                89,351
                
                
                
                213,063
                
                
                
                186,792
                
                
                
                348,460Exploration
      expenditure
                
                
                3,811,385
                
                
                
                5,132,000
                
                
                
                4,499,224
                
                
                
                8,943,385Stock
      based compensation
                
                
                115,307
                
                
                
                375,740
                
                
                
                329,411
                
                
                
                1,146,897Interest
      expense
                
                
                41,371
                
                
                
                62,196
                
                
                
                54,528
                
                
                
                112,131Loss
      on equipment written off
                
                
                -
                
                
                
                3,570
                
                
                
                3,130
                
                
                
                3,570Administration
      expenses
                
                
                479,093
                
                
                
                2,753,365
                
                
                
                2,413,875
                
                
                
                3,310,074Total
      expenses
                
                
                (4,536,507
                )
                
                
                (8,539,934
                )
                
                
                (7,486,960
                )
                
                
                (13,864,517
                )(Loss)
      from operations
                
                
                (4,534,577
                )
                
                
                (8,517,751
                )
                
                
                (7,467,512
                )
                
                
                (13,833,468
                )Foreign
      currency exchange gain/(loss)
                
                
                (40,017
                )
                
                
                (120,378
                )
                
                
                (105,535
                )
                
                
                (160,395
                )(Loss)
      before income taxes
                
                
                (4,574,594
                )
                
                
                (8,638,129
                )
                
                
                (7,573,047
                )
                
                
                (13,993,863
                )Provision
      for income taxes
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -Net
      (loss)
                
                
                (4,574,594
                )
                
                
                (8,638,129
                )
                
                
                (7,573,047
                )
                
                
                (13,993,863
                )Basic
      and diluted loss per common shares
                
                
                (0.06
                )
                
                
                (0.06
                )
                
                
                (0.05
                )
                
                
                (0.31
                )Weighted
      average number of common
                  shares
      used in per share calculations
                
                
                75,229,664
                
                
                
                146,739,872
                
                
                
                146,739,872
                
                
                
                44,441,012




The
accompanying notes are integral part of the financial statements.
  F-3




LEGEND
INTERNATIONAL HOLDINGS, INC.
 (An
Exploration Stage Company)
 Statements
of Stockholders' Equity (Deficit)
 for
the period ended December 31, 2007
  Common
      StockShares
                
                
                Par
                  Value
                  A$
                
                
                Additional
                  Paid-In
                  Capital
                  A$
                
                
                Retained
                  (Deficit)
      During
                  the
      Exploration
                  Period
                  A$
                
                
                Retained(Deficit)
                  During
      the Development
                  Period
                  A$
                
                
                Other
      Comprehensive
                  Gain
                  A$
                
                
                Stockholders’
                  Equity
                  (Deficit)
                  A$Balance,
      January 5, 2001
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -Shares
      issued to founder for organisation cost and services at US$0.05 per
      shares
                
                
                4,297,500
                
                
                
                5,550
                
                
                
                118,896
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                124,446Shares
      Issued for services rendered at US$0.05 per share
                
                
                146,250
                
                
                
                189
                
                
                
                4,046
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                4,235Shares
      Issued for Cash
                
                
                616,500
                
                
                
                796
                
                
                
                17,056
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                17,852Net
      Loss
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (131,421
                )
                
                
                -
                
                
                
                (131,421
                )Balance,
      December 31, 2001
                
                
                5,060,250
                
                
                
                6,535
                
                
                
                139,998
                
                
                
                -
                
                
                
                (131,421
                )
                
                
                -
                
                
                
                15,112Shares
      Issued for Cash
                
                
                225,000
                
                
                
                291
                
                
                
                6,225
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                6,516Shares
      Issued for Officer’s Compensation
                
                
                11,250,000
                
                
                
                14,529
                
                
                
                148,359
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                162,888Net
      Loss
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (182,635
                )
                
                
                -
                
                
                
                (182,635
                )Balance,
      December 31, 2002
                
                
                16,535,250
                
                
                
                21,355
                
                
                
                294,582
                
                
                
                -
                
                
                
                (314,056
                )
                
                
                -
                
                
                
                1,881Shares
      Issued for services rendered at US$0.022 per share
                
                
                5,026,500
                
                
                
                6,491
                
                
                
                139,065
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                145,556Net
      Loss
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (156,965
                )
                
                
                -
                
                
                
                (156,965
                )Balance,
      December 31, 2003
                
                
                21,561,750
                
                
                
                27,846
                
                
                
                433,647
                
                
                
                -
                
                
                
                (471,021
                )
                
                
                -
                
                
                
                (9,528
                )Shares
      Issued for services rendered at US$0.022 per share
                
                
                2,004,750
                
                
                
                2,589
                
                
                
                55,464
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                58,053Options
      Issued for services
                
                
                -
                
                
                
                -
                
                
                
                160,672
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                160,672Loan
      forgiveness-former major shareholder
                
                
                -
                
                
                
                -
                
                
                
                12,144
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                12,144Net
      Loss
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (234,611
                )
                
                
                -
                
                
                
                (234,611
                )Balance,
      December 31, 2004
                
                
                23,566,500
                
                
                
                30,435
                
                
                
                661,927
                
                
                
                -
                
                
                
                (705,632
                )
                
                
                -
                
                
                
                (13,270
                )Shares
      issued on cashless exercise of options
                
                
                17,085,938
                
                
                
                22,066
                
                
                
                (22,066
                )
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -Net
      Loss
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (75,508
                )
                
                
                -
                
                
                
                (75,508
                )Balance,
      December 31, 2005
                
                
                40,652,438
                
                
                
                52,501
                
                
                
                639,861
                
                
                
                -
                
                
                
                (781,140
                )
                
                
                -
                
                
                
                (88,778
                )Share
      issued on cashless exercise of options
                
                
                72,281,329
                
                
                
                93,336
                
                
                
                (93,336
                )
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -Shares
      and options issued under settlement agreement
                
                
                112,500
                
                
                
                144
                
                
                
                35,272
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                35,416Shares
      issued for cash
                
                
                12,756,734
                
                
                
                16,524
                
                
                
                3,854,843
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                3,871,367Cost
      of share issues
                
                
                -
                
                
                
                -
                
                
                
                (128,376
                )
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (128,376
                )Amortisation
      of Options under stock option plan
                
                
                -
                
                
                
                -
                
                
                
                115,307
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                115,307Net
      unrealized gain on foreign exchange translation
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                38,490
                
                
                
                38,490Net
      Loss
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (4,516,271
                )
                
                
                (58,323
                )
                
                
                -
                
                
                
                (4,574,594
                )Balance,
      December 31, 2006
                
                
                125,803,001
                
                
                
                162,505
                
                
                
                4,423,571
                
                
                
                (4,516,271
                )
                
                
                (839,463
                )
                
                
                38,490
                
                
                
                (731,168
                )




F-4




LEGEND
INTERNATIONAL HOLDINGS, INC.
 (An
Exploration Stage Company)
 Statements
of Stockholders' Equity (Deficit)
 for the
period ended December 31, 2007
 (continued)
  Common
      StockShares
                
                
                Par
                  Value
                  A$
                
                
                Additional
                  Paid-In
                  Capital
                  A$
                
                
                Retained
                  (Deficit)
      During
                  the
      Exploration Period
                  A$
                
                
                Retained
      (Deficit) During the Development
                  Period
                  A$
                
                
                Other
      Comprehensive
                  Gain
                  A$
                
                
                Stockholders’
                  Equity
                  (Deficit)
                  A$Shares
      issued for cash
                
                
                47,886,624
                
                
                
                56,690
                
                
                
                25,684,414
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                25,741,104Cost
      of share issues
                
                
                -
                
                
                
                -
                
                
                
                (1,675,111
                )
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (1,675,111
                )Shares
      issued for consulting fees
                
                
                2,604,200
                
                
                
                2,984
                
                
                
                1,001,122
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                1,004,106Shares
      issued on cashless exercise of options
                
                
                75,000
                
                
                
                85
                
                
                
                (85
                )
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -Shares
      issued as a result of delay in lodgement of registration
      statement
                
                
                200,000
                
                
                
                230
                
                
                
                364,575
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                364,805Shares
      issued for part-settlement of the acquisition of rights to exploration
      licences under agreement
                
                
                500,000
                
                
                
                545
                
                
                
                517,455
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                518,000Amortization
      of options under stock option plan
                
                
                -
                
                
                
                -
                
                
                
                375,740
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                375,740Net
      Loss
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (8,638,129
                )
                
                
                -
                
                
                
                -
                
                
                
                (8,638,129
                )Balance,
      December 31, 2007
                
                
                177,068,825
                
                
                
                223,039
                
                
                
                30,691,681
                
                
                
                (13,154,400
                )
                
                
                (839,463
                )
                
                
                38,490
                
                
                
                16,959,347




The
accompanying notes are integral part of the financial statements.
  F-5




LEGEND
INTERNATIONAL HOLDINGS, INC.
 (An
Exploration Stage Company)
 Statement
of Cash Flows
  For
      the years Ended December
                  31
                
                
                Convenience
      Translation
                
                
                January
      5, 2001 (Inception) to December 31,2006
                  A$
                
                
                
                2007
                  A$
                
                
                2007
                  US$
                
                
                
                2007
                  A$CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      Loss
                
                
                (4,574,594
                )
                
                
                (8,638,129
                )
                
                
                (7,573,048
                )
                
                
                (13,993,863
                )Adjustments
      to reconcile net loss to net cash provided (used) by operating
      activities:Foreign
      exchange
                
                
                40,017
                
                
                
                120,378
                
                
                
                105,535
                
                
                
                159,052Shares
      and Options issued for Stock Based Compensation-
      Employees
                
                
                115,307
                
                
                
                375,740
                
                
                
                329,411
                
                
                
                1,146,898-
      Consultants
                
                
                -
                
                
                
                383,833
                
                
                
                336,507
                
                
                
                383,833-
      Exploration Agreement
                
                
                -
                
                
                
                518,000
                
                
                
                454,131
                
                
                
                518,000-
      Registration Payment Arrangements
                
                
                -
                
                
                
                364,805
                
                
                
                319,825
                
                
                
                364,805Provision
      for rehabilitation
                
                
                -
                
                
                
                90,000
                
                
                
                78,903
                
                
                
                90,000Depreciation
                
                
                1,021
                
                
                
                19,949
                
                
                
                17,489
                
                
                
                20,970Accrued
      interest added to principal
                
                
                34,800
                
                
                
                -
                
                
                
                -
                
                
                
                37,282Net
      Change in:Receivables
                
                
                (169,271
                )
                
                
                (388,634
                )
                
                
                (340,716
                )
                
                
                (557,905
                )Prepayments
      and deposits
                
                
                (104,559
                )
                
                
                (136,281
                )
                
                
                (119,477
                )
                
                
                (240,840
                )Accounts
      Payable and Accrued Expenses
                
                
                532,144
                
                
                
                241,601
                
                
                
                211,812
                
                
                
                806,413Net
      Cash (Used) In Operating Activities
                
                
                (4,125,135
                )
                
                
                (7,048,738
                )
                
                
                (6,179,628
                )
                
                
                (11,265,355
                )CASH
      FLOWS FROM INVESTING ACTIVITIES:Write
      off of Property and Equipment
                
                
                -
                
                
                
                3,570
                
                
                
                3,130
                
                
                
                3,570Purchase
      of Property, Equipment and Motor Vehicle
                
                
                (12,273
                )
                
                
                (142,292
                )
                
                
                (124,748
                )
                
                
                (154,565
                )Net
      Cash (Used) In Investing Activities
                
                
                (12,273
                )
                
                
                (138,722
                )
                
                
                (121,618
                )
                
                
                (150,995
                )CASH
      FLOWS FROM FINANCING ACTIVITIES:Advances
      Payable - Affiliates
                
                
                1,245,345
                
                
                
                (1,271,501
                )
                
                
                (1,114,725
                )
                
                
                (26,156
                )Repayment
      of Convertible Debenture
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (130,310
                )Repayment
      of Shareholder Advance
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (641
                )Proceeds
      from Convertible Debenture Payable
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                130,310Shareholder
      Advance
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                6,621Proceeds
      from Issuance of Stock
                
                
                3,871,367
                
                
                
                25,741,103
                
                
                
                22,567,225
                
                
                
                29,636,838Cost
      of share issues
                
                
                (128,376
                )
                
                
                (1,033,749
                )
                
                
                (906,288
                )
                
                
                (1,162,125
                )Net
      Borrowing/Repayments from Affiliates
                
                
                (11,131
                )
                
                
                -
                
                
                
                -
                
                
                
                50,003Net
      Cash Provided for financing activities
                
                
                4,977,205
                
                
                
                23,435,853
                
                
                
                20,546,212
                
                
                
                28,504,540Net
      Increase in Cash
                
                
                839,797
                
                
                
                16,248,393
                
                
                
                14,244,966
                
                
                
                17,088,190Cash
      at Beginning of Period
                
                
                -
                
                
                
                839,797
                
                
                
                736,250
                
                
                
                -Cash
      at End of Period
                
                
                839,797
                
                
                
                17,088,190
                
                
                
                14,981,216
                
                
                
                17,088,190Supplemental
      Disclosures:Cash
      paid for interest
                
                
                -
                
                
                
                62,196
                
                
                
                54,527
                
                
                
                62,196Cash
      paid for income taxes
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -Stock  and
      options issued for services
                
                
                150,723
                
                
                
                641,361
                
                
                
                562,281
                
                
                
                1,447,935Accrued
      interest and stockholder advances charged to paid in
    capital
                
                
                -
                
                
                
                12,744
                
                
                
                11,172
                
                
                
                12,744Stock
      issued for exploration agreement
                
                
                -
                
                
                
                518,000
                
                
                
                454,131
                
                
                
                518,000Stock
      issued for registration payment arrangement
                
                
                -
                
                
                
                364,805
                
                
                
                319,825
                
                
                
                364,805Equipment
      obtained through a capital lease
                
                
                -
                
                
                
                24,581
                
                
                
                21,550
                
                
                
                24,581Capital
      lease obligation for exploration costs
                
                
                -
                
                
                
                362,462
                
                
                
                317,770
                
                
                
                362,462Interest
      in relation to capital lease for exploration costs
                
                
                -
                
                
                
                42,313
                
                
                
                37,096
                
                
                
                42,313




The
accompanying notes are integral part of the financial statements.
  F-6




LEGEND
INTERNATIONAL HOLDINGS, INC.
 (An
Exploration Stage Company)
 Notes to
Financial Statements
  1.
              
              ORGANISATION
      AND BUSINESS
 
 Legend
International Holdings, Inc, ("the Company"), was incorporated under the laws of
the State of Delaware on January 5, 2001.
 
 The
Company has never generated any significant revenues from operations and is
still considered an exploration stage company.  The Company was
initially formed to engage in the business of selling compatible inkjet
cartridges and refill kits on the Internet for the consumer printer
market.  In March 2003, management of the Company decided to engage in
the business of building and acquiring controlling or other interests in one or
more companies engaged in the contract sales and distribution of specialty
medical products, and raise additional capital for this
purpose.  Neither business was successful and operations of both were
eventually discontinued.  During fiscal 2004, management of the
Company developed a plan of operations to acquire income-producing real
property.  The Company did not acquire any properties pursuant to such
plan.
 
 Following
a change of management in November 2004, the Company developed a new plan of
operations for fiscal 2006, which is to engage in mineral exploration and
development activities.  The Company's current business plan calls for
the identification of mineral properties where it can obtain secure title to
exploration, development and mining interests. The Company’s preference is to
identify large minerals deposits with low operating costs. The Company is
prepared to consider the exploration, development and mining of profitable base
metal interests.  At the beginning of 2006, the Company expanded its
areas of interest to include diamond exploration activities and in July 2006,
the Company completed the acquisition of certain diamond mining tenements in
Northern Australia. Since that time, the Company has identified that those
mining tenements in Northern Australia also have potential for uranium and base
metals. In November 2007, the Company acquired mining tenements prospective for
phosphate in the State of Queensland, Australia.
 
 The
Company's financial statements are prepared using generally accepted accounting
principles applicable to a going concern, which contemplates the realization of
assets and liquidation of liabilities in the normal course of business. However,
the Company has incurred net losses since its inception.
 
 Exploration
Stage Enterprise
 
 The
Company is an exploration stage enterprise. The Company is devoting all of its
present efforts in securing and establishing its exploration business through
field sampling and drilling programs in the State of Queensland and the Northern
Territory of Australia.
 
 2.
              
              RECENT
      ACCOUNTING PRONOUNCEMENTS
 
 In July
2006, the Financial Accounting Standards Board (FASB) issued FASB Interpretation
No. 48, Accounting for Uncertainty in Income Taxes – an interpretation of FASB
Statement No. 109 (FIN 48), which provides clarification related to the process
associated with accounting for uncertain tax positions recognized in
consolidated financial statements. FIN 48 prescribes a more-likely-than-not
threshold for financial statement recognition and measurement of a tax position
taken, or expected to be taken, in a tax return. FIN 48 also provides guidance
related to, among other things, classification, accounting for interest and
penalties associated with tax positions, and disclosure requirements. FIN 48 is
effective for fiscal years beginning after December 15, 2006. The adoption of
this statement did not have a material effect on the Company’s future reported
financial position or results of operations.
 
 In
September 2006, the FASB issued SFAS No. 157, Fair Value Measurements which
provides enhanced guidance for using fair value to measure assets and
liabilities. SFAS No. 157 provides a common definition of fair value and
establishes a framework to make the measurement of fair value in generally
accepted accounting principles more consistent and comparable. SFAS No. 157 also
requires expanded disclosures to provide information about the extent to which
fair value is used to measure assets and liabilities, the methods and
assumptions used to measure fair value, and the effect of fair value measures on
earnings. SFAS No. 157 is effective for financial statements issued in fiscal
years beginning after November 15, 2007 and for interim periods within those
fiscal years. The adoption of this interpretation is not expected to have a
material impact on the Company’s future reported financial position or results
of operations.
 
 F-7
  In
February 2007 the FASB issued SFAS No. 159, “The Fair Value Option for Financial
Assets and Financial Liabilities-Including an Amendment of FASB Statement No.
115”, which permits companies to choose to measure many financial instruments
and certain other items at fair value. SFAS 159 is effective for fiscal years
beginning after November 15, 2007 and interim periods within those fiscal years.
The adoption of this interpretation is not expected to have a material impact on
the Company’s future reported financial position or results of
operations.
 
 In
December 2007, the FASB issued SFAS No. 141(R), “Business Combinations” (“SFAS
141(R)”), which replaces SFAS 141. SFAS 141(R) requires assets and liabilities
acquired in a business combination, contingent consideration, and certain
acquired contingencies to be measured at their fair values as of the date of
acquisition. SFAS 141(R) also requires that acquisition-related costs and
restructuring costs be recognized separately from the business combination. SFAS
141(R) is effective for fiscal years beginning after December 15, 2008 and will
be effective for business combinations entered into after January 1, 2009. The
Company is currently evaluating the potential impact of adopting this statement
on the Company’s financial position, results of operations or
cashflows.
 
 In
December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in
Consolidated Financial Statements, an Amendment of ARB No. 51” (“SFAS 160”).
SFAS 160 clarifies the accounting for noncontrolling interests and establishes
accounting and reporting standards for the noncontrolling interest in a
subsidiary, including classification as a component of equity. SFAS 160 is
effective for fiscal years beginning after December 15, 2008. The Company does
not currently have any minority interests.
 
 3.
              
              SUMMARY
      OF SIGNIFICANT ACCOUNTING POLICIES
 
 Exploration
Expenditure
 
 Exploration
expenditure consisting of acquisition cost and related expenditure, prospecting
and exploration costs are written off into operations as incurred.
 
 Functional
and Reporting Currency
 
 Prior to
July 31, 2006, the Company’s functional currency was the US dollar. However, as
a result of the purchase of diamond mining tenements in Northern Australia in
July 2006, the Company’s 2006 revenue and expenses will be primarily denominated
in Australian dollars (A$). Statement of Financial Accounting Standards
(‘‘SFAS’’) No. 52, Foreign Currency Translation, states that the functional
currency of an entity is the currency of the primary economic environment in
which the entity operates. Accordingly the Company determined that from August
1, 2006 the functional currency of the Company is the Australian dollar. Assets,
liabilities and equity were translated at the rate of exchange at July 31,
2006.  Revenue and expenses were translated at actual rates.
Translation gains and losses were included as part of accumulated other
comprehensive gain.
 
 Restatement
of comparative numbers was made for the change in functional and reporting
currency. The change was adopted prospectively beginning July 31, 2006 in
accordance with SFAS No. 52.
 
 Stock
Options
 
 For the
issuances of stock options, the Company follows the fair value provisions of
Financial Accounting Standards No. 123(R) “Share Based Payments”. SFAS 123(R)
requires the company to measure the cost of employee services received in
exchange for an award of equity instruments based on grant date fair
value.  The cost will be recognised over the period during which an
employee is required to provide service in exchange for the award – usually the
vesting period.  In the case where there is no required service
period, the fair value of the equity instruments is expensed
immediately.
 
 F-8
  Loss per
Common Share
 
 Basic loss
per share is computed on the basis of the weighted average number of common
shares outstanding during each year. Diluted loss per share is not presented as
the effect of Common Stock equivalents would be anti dilutive.
 
 Comprehensive
Income
 
 Statement
of Financial Accounting Standards (SFAS) No. 130, "Reporting Comprehensive
Income," establishes standards for reporting and display of comprehensive
income, its components and accumulated balances.  Comprehensive income
is defined to include all changes in equity except those resulting from
investments by owners and distributions to owners.  Among other
disclosures, SFAS No. 130 requires that all items that are required to be
recognized under current accounting standards as components of comprehensive
income be reported in a financial statement that is displayed with the same
prominence as other financial statements. The translation gains and losses from
the change to functional currency of the Company from August 1, 2006 are
included as part of the accumulated other comprehensive loss. Comprehensive loss
for the years ended December 31, 2007 and 2006 amounted to A$8,636,129 and
A$4,536,104 respectively.
 
 Property
and Equipment
 
 Property
and equipment is stated at cost.  Depreciation is computed over a
period covering the estimated useful life of the applicable property and
equipment.
 
 At
      December 31, 2007
              
              
              At
      December 31, 2006Depreciable
      Life
                (in
      years)
              
              
              Cost
                A$
              
              
              Accumulated
      Depreciation
                A$
              
              
              Net
      Book
                Value
                A$
              
              
              Cost
                A$
              
              
              Accumulated
      Depreciation
                A$
              
              
              Net
      Book Value
                A$Leasehold
      Improvements
              
              
              1-2
              
              
              
              16,732
              
              
              
              (105
              )
              
              
              16,627
              
              
              
              -
              
              
              
              -
              
              
              
              -Motor
      Vehicles
              
              
              5
              
              
              
              104,782
              
              
              
              (13,114
              )
              
              
              91,668
              
              
              
              26,332
              
              
              
              (402
              )
              
              
              25,930Equipment
              
              
              1-5
              
              
              
              57,633
              
              
              
              (7,751
              )
              
              
              49,882
              
              
              
              10,523
              
              
              
              (619
              )
              
              
              9,904179,147
              
              
              
              (20,970
              )
              
              
              158,177
              
              
              
              36,855
              
              
              
              (1,021
              )
              
              
              35,834
 
 The
depreciation expense for the year ended December 31, 2007 amounted to A$19,949
(US$17,489) and the year ended December 31, 2006 A$1,021.
 
 Cash
 
 Cash
consists of all cash balances and highly liquid investments with an original
maturity of three months or less. Because of the short maturity of these
investments, the carrying amounts approximate their fair value.
 
 Federal
Income Tax
 
 The
Company has adopted the provisions of Financial Accounting Standards Board
Statement No. 109, Accounting for Income Taxes. The Company accounts for income
taxes pursuant to the provisions of the Financial Accounting Standards Board
Statement No. 109, "Accounting for Income Taxes", which requires an asset and
liability approach to calculating deferred income taxes.  The asset
and liability approach requires the recognition of deferred tax liabilities and
assets for the expected future tax consequences of temporary differences between
the carrying amounts and the tax basis of assets and liabilities. For the period
presented, there was no taxable income. There are no deferred income taxes
resulting from temporary differences in reporting certain income and expense
items for income tax and financial accounting purposes. Legend, at this time, is
not aware of any net operating losses which are expected to be
realised.
 
 F-9
  Foreign
Currency Translation
 
 The
Company’s functional and reporting currency is the Australian dollar. Expenses
incurred in a currency other than the reporting currency, Australian dollars are
translated at the date invoiced. Assets and liabilities are re-valued at the
period end exchange rate where appropriate. Foreign currency exchange loss in
2007 amounted to A$120,378 (US$105,535), (2006 A$40,017).
 
 Goods and
Services Tax (“GST”)
 
 Revenues,
expenses and assets generated in Australia are subject to Australian GST which
requires the supplier to add a 10% GST to predominately all expenses and the
cost of assets and for the Company to include a 10% GST to the selling price of
a product. Revenues, expenses and assets are recognized net of the amount of GST
except where the GST incurred on a purchase of goods and services is not
recoverable from the taxation authority, in which case the GST is recognized as
part of the cost of acquisition of the assets or as part of the expense item as
applicable, and receivables and payables are stated with the amount of GST
included. The net amount of GST recoverable from, or payable to, the taxation
authority is included as part of receivables or payables in the balance sheet.
Cash flows are included in the cash flow statement on a gross basis and the GST
component of cash flows arising from investing and financing activities which is
recoverable from, or payable to, the taxation authority are classified as
operating cash flows. Commitments and contingencies are disclosed net of the
amount of GST recoverable from, or payable to, the taxation
authority
 
 Reclamation
and Remediation Obligations (Asset Retirement Obligations)
 
 Reclamation
costs are allocated to expense over the life of the exploration activity and are
periodically adjusted to reflect changes in the estimated present value
resulting from the passage of time and revisions to the estimates of either the
timing or amount of the reclamation and remediation costs. The asset retirement
obligation is based on when the spending for an existing environmental
disturbance will occur. The Company reviews, on at least an annual basis, the
asset retirement obligation at each exploration site.
 
 Future
remediation costs are accrued based on management’s best estimate at the end of
each period of the costs expected to be incurred. Such cost estimates include,
where applicable, plugging of drillholes, removal of consumerables and ripping
of drill pads and tracks. Changes in estimates are reflected in earnings in the
period an estimate is revised.
 
 Accounting
for reclamation and remediation obligations requires management to make
estimates unique to each exploration operation of the future costs the Company
will incur to complete the reclamation and remediation work required to comply
with existing laws and regulations. Actual costs incurred in future periods
could differ from amounts estimated. Additionally, future changes to
environmental laws and regulations could increase the extent of reclamation and
remediation work required. Any such increases in future costs could materially
impact the amounts charged to earnings for reclamation and
remediation.
 
 Financial
Instruments
 
 The
Company’s cash, receivables, payables, short and long term borrowings represent
financial instruments whose carrying amounts reasonably approximate their fair
value.
 
 Concentrations
of credit risk
 
 The
Company monitors its position with, and the credit quality of, the financial
institution it invests with. As of the balance sheet date, and periodically
throughout the year, the Company has maintained balances in various operating
accounts in excess of federally insured limits.
 
 Convenience
Translation to US$
 
 F-10
  The
consolidated financial statements as of and for the year ended December 31, 2007
have been translated into United States dollars using the rate of exchange of
the United States dollar at December 31, 2007 (A$1.00=US$0.8767). The
translation was made solely for the convenience of readers in the United
States.
 
 Use of
Estimates
 
 The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure on 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.
 
 Comparative
Figures
 
 Where
necessary, comparative figures have been restated to be consistent with current
year presentation.
 
 Prior to
July 31, 2006, the Company’s functional currency was the US dollar. However, as
a result of the purchase of diamond mining tenements in Northern Australia in
July 2006, the Company’s 2006 revenue and expenses are primarily denominated in
Australian dollars (A$). Statement of Financial Accounting Standards (‘‘SFAS’’)
No. 52, Foreign Currency Translation, states that the functional currency of an
entity is the currency of the primary economic environment in which the entity
operates. Accordingly the Company determined that from August 1, 2006 the
functional currency of the Company is the Australian dollar. Assets, liabilities
and equity were translated at the rate of exchange at  July 31,
2006.  Revenue and expenses were translated at actual rates.
Translation gains and losses were included as part of accumulated other
comprehensive gain.
 
 4.
              
              STOCKHOLDERS
      EQUITY
 
 Common
Stock
 
 In January
2001, 4,297,500 common shares were issued to the Company's founder for
organization cost valued at A$124,446 (US$95,500), and 146,250 common shares
were issued to a related party in exchange for consulting fee valued at A$4,235
(US$3,250).
 
 In March
2002, 11,250,000 common shares were issued to the Company's founder in exchange
for present and future services valued at A$162,888 (US$125,000).
 
 In April
2002, the Company closed its offering under its registration statement filed
with the United States Securities and Exchange Commission to sell up to
4,500,000 shares of its Common Stock at US$0.022 per share, which became
effective on April 11, 2001. The Company sold 841,500 shares (616,500 shares in
2001 and a further 225,000 shares in 2002) of its Common Stock under the
offering.
 
 In 2003, a
total of 5,026,500 common shares were issued to the Company's sole officer and
director for services valued at A$145,556 (US$111,700) or A$0.029 (US$0.022) per
share.
 
 In 2004, a
total of 2,004,750 common shares were issued to the Company’s former sole
officer and director for services valued at A$58,053 (US$44,550) or A$0.029
(US$0.022) per share.
 
 In
December 2004, the Company issued to Renika Pty Limited (“Renika”), a company
associated with Mr J I Gutnick, 20,250,000 options to be converted into
20,250,000 shares of Common Stock, at an exercise price of US$0.022 and a latest
exercise date of December 2009 for services to be rendered to the
Company.  The Company undertook a Black Scholes valuation of these
options using a A$0.029 (US$0.022) exercise price, US$0.022 market price, 5 year
life, risk free interest rate of 5.155% and a volatility of
16.7%.  The 20,250,000 options were valued at A$160,672 (US$123,300)
or A$0.008 (US$0.006) each.  The stock options were issued for
services rendered, to be rendered and for agreeing to provide financial
assistance to the Company (not the actual provision of financial
assistance).  The issue of the stock options was not contingent upon
any further services or events.  The stock options are not forfeitable
if the services or financial assistance are not
provided.  Accordingly, the value of the stock options were expensed
during 2004.
 
 F-11
  In
September 2005, Renika exercised the 20,250,000 options using the cashless
exercise feature and were issued 17,085,937 shares of Common Stock.
 
 Effective
as of December 12, 2005, the Board of Directors of Company approved the
distribution to all stockholders for no consideration of an aggregate of
36,135,500 non-transferable options, each of which is exercisable to purchase
one share of Common Stock of the Company at an exercise price of US$0.25 cents
per share with a latest exercise date of December 31, 2012.  The
options were issued on a pro-rata basis to all stockholders of record on
December 31, 2005 on the basis of two (2) options for every one (1) share of
Common Stock owned by a stockholder on the record date. The options may not be
exercised until the shares underlying the options are registered under federal
and state securities laws.
 
 At
December 31, 2005 the Company had outstanding 36,135,500 options and as at
December 31, 2006, the Company had outstanding 1,388,280 options, each of which
is exercisable to purchase one share of Common Stock at US$0.25 per
share.  The options cannot be exercised, other than using the cashless
exercise feature, until the Company registers the shares of Common Stock to be
issued upon exercise of the options in accordance with the Securities Act of
1933, as amended and any applicable state securities laws. The only exception is
in the case of a cashless exercise.
 
 Effective
July 21, 2006, Legend issued 71,730,079 shares of Common Stock to Renika Pty Ltd
(“Renika”), a company associated with Mr. J I Gutnick, President of Legend,
following the cashless exercise of 34,778,220 options. The shares of Common
Stock issued are restricted shares.
 
 Between
September 19, 2006 and November 17, 2006, Legend issued 11,703,728 shares of
Common Stock at a placement price of US$0.22 per share raising A$3,425,662. The
securities were issued pursuant to a private placement and are issued in
reliance upon an exemption from the registration requirements of the Securities
Act of 1933, as amended (“The Act”) under Section 4(2) of the Act.
 
 Effective
November 30, 2006, Legend issued a further 112,500 shares of Common Stock and
50,000 options with an exercise price of A$0.25 per option and a latest exercise
date of December 12, 2012 for no consideration to settle outstanding matters
with an external party. The Company has valued these shares and options at
A$35,416.
 
 Effective
December 31, 2006, Legend issued a further 1,053,000 shares of Common Stock at a
placement price of US$0.33 raising A$445,705 (US$351,000). The securities were
issued pursuant to a private placement and are issued in reliance upon an
exemption from the registration requirements of the Securities Act of 1933, as
amended (“the Act”) under Section 4 (2) of the Act.
 
 In
December 2006, 19,000 options issued with no exercise price were exercised and
the Company issued 24,750 shares of Common Stock.
 
 In
December 2006, 351,000 options were exercised using the cashless exercise
feature and the Company issued 526,500 shares of Common Stock.
 
 Between
January 1, 2007 and September 30, 2007, Legend issued a further 29,136,624
shares of Common Stock raising A$8,816,411 (US$7,226,906). The securities were
issued pursuant to a private placement and are issued in reliance upon an
exemption from the registration requirements of the Securities Act of 1933 as
amended (“The Act”) under Section 4(2) of the Act.
 
 Effective
June 15, 2007, Legend issued a further 200,000 shares of Common Stock for
consulting fees amounting to A$59,074 (US$50,000).
 
 F-12
  Between
July 1, 2007 and September 30, 2007, Legend issued a further 2,150,200 shares of
Common Stock for consulting fees amounting to A$614,469
(US$537,550).
 
 On
December 12, 2007, Legend issued a further 18,750,000 shares of Common Stock at
a placement price of US$0.80 per share raising A$16,924,292 (US$15,000,000). The
securities were issued pursuant to a private placement and are issued in
reliance upon an exemption from the registration requirements of the Securities
Act of 1933 as amended (“The Act”) under Section 4(2) of the Act.
 
 Between
October 1, 2007 and December 31, 2007, Legend issued a further 500,000 shares of
Common Stock for part settlement of acquisition of exploration permits amounting
to A$518,000 (US$475,000).
 
 Between
October 1, 2007 and December 31, 2007, Legend issued a further 254,000 shares
for consulting fees amounting to A$330,564 (US$289,420).
 
 Between
October 1, 2007 and December 31, 2007, Legend issued a further 200,000 shares of
Common Stock as a result of delays in lodging a registration statement amounting
to A$364,805 (US$318,000)
 
 Share
Bonus Issue
 
 Effective
November 17, 2006, Legend issued one (1) new bonus share of Common Stock for
every two (2) shares of Common Stock outstanding on the record at that date. The
issue of the new bonus shares of Common Stock were on a pro-rate basis to all
shareholders. As a result, the Company issued 27,599,722 shares of its Common
Stock.
 
 Effective
December 31, 2006, Legend issued one (1) new bonus share of Common Stock for
every two (2) shares of Common Stock outstanding on the record at that date. The
issue of the new bonus shares of Common Stock were on a pro-rata basis to all
shareholders. As a result, the Company issued 41,934,337 shares of its Common
Stock.
 
 The
Company has accounted for these two bonus issues as a stock split and
accordingly, all share and per share data has been retroactively
restated.
 
 Issue of
Options under Equity Incentive Plan
 
 (i)
              Effective
      September 19, 2006, the Company issued 8,100,000 options over shares of
      Common Stock to Directors, Executives and Consultants under the 2006
      Equity Incentive Plan that has been adopted by the Directors of the
      Company. The options will vest 1/3 after 12 months, 1/3 after 24 months
      and the balance of 1/3 after 36 months. The exercise price of the options
      is US$1.00 for the President and Chief Executive Officer and one other
      participant; and for all other participants, US$0.444 for 50% of the
      options and US$1.00 for the balance of 50% of the options. The latest
      exercise date for the options is September 19,
  2016.
 
 The
Company has accounted for all options issued based upon their fair market value
using the Binomial pricing model.
 
 An
external consultant has calculated the fair value of the 8,100,000 options using
the Binomial valuation method using the following inputs:
  Grant
      date
                Sept
      19, 2006
                Sept
      19, 2006
                Sept
      19, 2006
                Sept
      19, 2006
                Sept
      19, 2006
                Sept
      19, 2006Grant
      date share price
                US$0.222
                US$0.222
                US$0.222
                US$0.222
                US$0.222
                US$0.222Vesting
      date
                Sept
      19, 2007
                Sept
      19, 2007
                Sept
      19, 2008
                Sept
      19, 2008
                Sept
      19, 2009
                Sept
      19, 2009Expected
      life in years
                5.50
                5.50
                6.00
                6.00
                6.50
                6.50Risk-free
      rate
                4.69%
                4.69%
                4.69%
                4.69%
                4.69%
                4.69%Volatility
                60%
                60%
                60%
                60%
                60%
                60%Exercise
      price
                US$0.444
                US$1.00
                US$0.444
                US$1.00
                US$0.444
                US$1.00Call
      option value
                US$0.09
                US$0.05
                US$0.10
                US$0.06
                US$0.10
                US$0.06




F-13




The
Company adopted revised SFAS No.123, Share-Based payment, which addresses the
accounting for share-based payment transactions in which a company receives
employee services in exchange for (a) equity instruments of that company or (b)
liabilities that are based on the fair value of the company’s equity instruments
or that may be settled by the issuance of such equity instruments.
  Options
              
              
              Option
      Price Per Share
                US$
              
              
              Weighted
      Average Exercise Price
                US$Outstanding
      at January 1, 2006
              
              
              -
              
              
              
              -
              
              
              
              -Granted
              
              
              8,100,000
              
              
              
              0.444-1.00
              
              
              
              0.69Forfeited
              
              
              -
              
              
              
              -
              
              
              
              -Outstanding
      at December 31, 2006
              
              
              8,100,000
              
              
              
              0.444-1.00
              
              
              
              0.69Granted
              
              
              -
              
              
              
              -
              
              
              
              -Forfeited
              
              
              (1,575,000
              )
              
              
              -
              
              
              
              -Outstanding
      at December 31, 2007
              
              
              6,525,000
              
              
              
              0.444-1.00
              
              
              
              0.69
 
 The range
of exercise price is US$0.444 to US$1.00 per option. The weighted average per
option fair value of options granted during 2006 was US$0.07 and the weighted
average remaining contractual life of those options is 83⁄4  years. No
options are currently exercisable.
 
 The total
value of the outstanding unvested options equates to A$192,979 (US$177,513) and
is being amortised over the vesting periods.
 
 For 2007,
the amortization amounted to A$281,844 (US$259,345).
 
 (ii)
              Effective
      May 16, 2007, the Company issued 862,500 options over shares of Common
      Stock to employees under the 2006 Equity Incentive Plan that has been
      adopted by the Directors of the Company. The options will vest 1/3 after
      12 months, 1/3 after 24 months and the balance of 1/3 after 36 months. The
      exercise price of the options is US$0.444 for 50% of the options and
      US$1.00 for the balance of 50% of the options. The latest exercise date
      for the options is May 16, 2017.
 
 The
Company has accounted for all options issued based upon their fair market value
using the Binomial pricing model.
 
 An
external consultant has calculated the fair value of the 862,500 options using
the Binomial valuation method using the following inputs:
  Grant
      date
                May
      16, 2007
                May
      16, 2007
                May
      16, 2007
                May
      16, 2007
                May
      16, 2007
                May
      16, 2007Grant
      date share price
                US$0.25
                US$0.25
                US$0.25
                US$0.25
                US$0.25
                US$0.25Vesting
      date
                May
      16, 2008
                May
      16, 2008
                May
      16, 2009
                May
      16, 2009
                May
      16, 2010
                May
      16, 2010Expected
      life in years
                5.50
                5.50
                6.00
                6.00
                6.50
                6.50Risk-free
      rate
                4.92%
                4.92%
                4.92%
                4.92%
                4.92%
                4.92%Volatility
                60%
                60%
                60%
                60%
                60%
                60%Exercise
      price
                US$0.444
                US$1.00
                US$0.444
                US$1.00
                US$0.444
                US$1.00Call
      option value
                US$0.1111
                US$0.064
                US$0.117
                US$0.072
                US$0.124
                US$0.079




Options
              
              
              Option
      Price Per Share
                US$
              
              
              Weighted
      Average Exercise Price
                US$Outstanding
      at January 1, 2007
              
              
              -
              
              
              
              -
              
              
              
              -Granted
              
              
              862,500
              
              
              
              0.444-1.00
              
              
              
              0.69Forfeited
              
              
              (187,500
              )
              
              
              -
              
              
              
              -Outstanding
      at December 31, 2007
              
              
              675,000
              
              
              
              0.444-1.00
              
              
              
              0.69




The range
of exercise price is US$0.444 to US$1.00 per option. The weighted average per
option fair value of options granted during 2007 was US$0.0945 and the weighted
average remaining contractual life of those options is 91⁄2  years. No
options are currently exercisable. The forfeiture rate of 56.52% is based on
personnel retention history for persons in this class of participants by AXIS
Consultants Pty Ltd.
 
 F-14
  The total
value of the outstanding unvested options including employee retention factor
equates to A$26,665 (US$22,185) and is being amortised over the vesting
periods.
 
 For 2007,
the amortization amounted to A$15,928 (US$13,964).
 
 (iii)
              Effective
      September 10, 2007, the Company issued 300,000 options over shares of
      Common Stock to employees under the 2006 Equity Incentive Plan that has
      been adopted by the Directors of the Company. The options will vest 1/3
      after 12 months, 1/3 after 24 months and the balance of 1/3 after 36
      months. The exercise price of the options is US$0.444 for 50% of the
      options and US$1.00 for the balance of 50% of the options. The latest
      exercise date for the options is September 10,
  2017.
 
 The
Company has accounted for all options issued based upon their fair market value
using the Binomial pricing model.
 
 An
external consultant has calculated the fair value of the 300,000 options using
the Binomial valuation method using the following inputs:
  Grant
      date
                Sept
      10, 2007
                Sept
      10, 2007
                Sept
      10, 2007
                Sept
      10, 2007
                Sept
      10, 2007
                Sept
      10, 2007Grant
      date share price
                US$1.25
                US$1.25
                US$1.25
                US$1.25
                US$1.25
                US$1.25Vesting
      date
                Sept
      10, 2008
                Sept
      10, 2008
                Sept
      10, 2009
                Sept
      10, 2009
                Sept
      10, 2010
                Sept
      10, 2010Expected
      life in years
                5.50
                5.50
                6.00
                6.00
                6.50
                6.50Risk-free
      rate
                4.637%
                4.637%
                4.637%
                4.637%
                4.637%
                4.637%Volatility
                60%
                60%
                60%
                60%
                60%
                60%Exercise
      price
                US$0.444
                US$1.00
                US$0.444
                US$1.00
                US$0.444
                US$1.00Call
      option value
                US$0.98
                US$0.79
                US$1.00
                US$0.81
                US$1.01
                US$0.83




Options
              
              
              Option
      Price Per Share
                US$
              
              
              Weighted
      Average Exercise Price
                US$Outstanding
      at January 1, 2007
              
              
              -
              
              
              
              -
              
              
              
              -Granted
              
              
              300,000
              
              
              
              0.444-1.00
              
              
              
              0.69Forfeited
              
              
              -
              
              
              
              -
              
              
              
              -Outstanding
      at December 31, 2007
              
              
              300,000
              
              
              
              0.444-1.00
              
              
              
              0.69




The range
of exercise price is US$0.444 to US$1.00 per option. The weighted average per
option fair value of options granted during 2007 was US$0.9033 and the weighted
average remaining contractual life of those options is 93⁄4 years. No options are
currently exercisable. The forfeiture rate of 50% in the third year is based on
personnel retention history for persons in this class of participants by AXIS
Consultants Pty Ltd.
 
 The total
value of the outstanding unvested options including employee retention factor
equates to A$216,726 (US$179,254) and is being amortised over the vesting
periods.
 
 For 2007,
the amortization amounted to A$55,309 (US$48,489).
 
 (iv)
              Effective
      December 19, 2007, the Company issued 300,000 options over shares of
      Common Stock to employees under the 2006 Equity Incentive Plan that has
      been adopted by the Directors of the Company. The options will vest 1/3
      after 12 months, 1/3 after 24 months and the balance of 1/3 after 36
      months. The exercise price of the options is US$0.444 for 50% of the
      options and US$1.00 for the balance of 50% of the options. The latest
      exercise date for the options is December 19,
  2017.
 
 The
Company has accounted for all options issued based upon their fair market value
using the Binomial pricing model.
 
 An
external consultant has calculated the fair value of the 300,000 options using
the Binomial valuation method using the following inputs:
  F-15




Grant
      date
              Dec
      19, 2007
              Dec
      19, 2007
              Dec
      19, 2007
              Dec
      19, 2007
              Dec
      19, 2007
              Dec
      19, 2007Grant
      date share price
              US$0.95
              US$0.95
              US$0.95
              US$0.95
              US$0.95
              US$0.95Vesting
      date
              Dec
      19, 2008
              Dec
      19, 2008
              Dec
      19, 2009
              Dec
      19, 2009
              Dec
      19, 2010
              Dec
      19, 2010Expected
      life in years
              5.50
              5.50
              6.00
              6.00
              6.50
              6.50Risk-free
      rate
              4.441%
              4.441%
              4.441%
              4.441%
              4.441%
              4.441%Volatility
              60%
              60%
              60%
              60%
              60%
              60%Exercise
      price
              US$0.444
              US$1.00
              US$0.444
              US$1.00
              US$0.444
              US$1.00Call
      option value
              US$0.70
              US$0.54
              US$0.71
              US$0.56
              US$0.72
              US$0.58




Options
              
              
              Option
      Price Per Share
                US$
              
              
              Weighted
      Average Exercise Price
                US$Outstanding
      at January 1, 2007
              
              
              -
              
              
              
              -
              
              
              
              -Granted
              
              
              300,000
              
              
              
              0.444-1.00
              
              
              
              0.69Forfeited
              
              
              -
              
              
              
              -
              
              
              
              -Outstanding
      at December 31, 2007
              
              
              300,000
              
              
              
              0.444-1.00
              
              
              
              0.69




The range
of exercise price is US$0.444 to US$1.00 per option. The weighted average per
option fair value of options granted during 2007 was US$0.6350 and the weighted
average remaining contractual life of those options is 10 years. No options are
currently exercisable. The forfeiture rate of 50% in the third year is based on
personnel retention history for persons in this class of participants by AXIS
Consultants Pty Ltd.
 
 The total
value of the outstanding unvested options including employee retention factor
equates to A$179,810 (US$154,565) and is being amortised over the vesting
periods.
 
 For 2007,
the amortization amounted to A$3,996 (US$3,503).
 
 (v)
              Effective
      December 28, 2007, the Company issued 4,787,500 options over shares of
      Common Stock to employees under the 2006 Equity Incentive Plan that has
      been adopted by the Directors of the Company. The options will vest 1/3
      after 12 months, 1/3 after 24 months and the balance of 1/3 after 36
      months. The exercise price of the options is US$1.00. The latest exercise
      date for the options is December 28,
2017.
 
 The
Company has accounted for all options issued based upon their fair market value
using the Binomial pricing model.
 
 An
external consultant has calculated the fair value of the 4,787,500 options using
the Binomial valuation method using the following inputs:
  Grant
      date
                Dec
      28, 2007
                Dec
      28, 2007
                Dec
      28, 2007Grant
      date share price
                US$1.09
                US$1.09
                US$1.09Vesting
      date
                Dec
      28, 2008
                Dec
      28, 2009
                Dec
      28, 2010Expected
      life in years
                5.50
                6.00
                6.50Risk-free
      rate
                4.488%
                4.488%
                4.488%Volatility
                60%
                60%
                60%Exercise
      price
                US$1.00
                US$1.00
                US$1.00Call
      option value
                US$0.65
                US$0.67
                US$0.69


Options
            
            
            Option
      Price Per Share
              US$
            
            
            Weighted
      Average Exercise Price
              US$Outstanding
      at January 1, 2007
            
            
            -
            
            
            
            -
            
            
            
            -Granted
            
            
            4,787,500
            
            
            
            1.00
            
            
            
            1.00Forfeited
            
            
            -
            
            
            
            -
            
            
            
            -Outstanding
      at December 31, 2007
            
            
            4,787,500
            
            
            
            1.00
            
            
            
            1.00




The range
of exercise price is US$0.444 to US$1.00 per option. The weighted average per
option fair value of options granted during 2007 was US$0.67 and the weighted
average remaining contractual life of those options is 10 years. No options are
currently exercisable. The forfeiture rate of 42.85% in the third year is based
on personnel retention history for persons in this class of participants by AXIS
Consultants Pty Ltd.
 
 F-16
  The total
value of the outstanding unvested options including employee retention factor
equates to A$3,574,212 (US$3,127,793) and is being amortised over the vesting
periods.
 
 For 2007,
the amortization amounted to A$18,664 (US$16,345).
 
 As of
December 31, 2007, 5,119,326 options over shares were available for future
grants under the Stock Plan.
 
 5.
              
              SHORT-TERM
      ADVANCE – AFFILIATE
 
 During
2007, the Company repaid the amount owing to Astro Diamond Mines N.L. for costs
incurred on mining tenements acquired in 2006, including interest charged for
2007 of A$16,744. Astro charged interest at the rate of between 9.85% and
10.10%, being the “reference rate” of the ANZ Banking Group Ltd.
 
 During
June 2007, the Company paid AXIS Consultants Pty Ltd amounts owing under the
Service Agreement (refer footnote 6 for further information). The amount of
A$2,432,687 included an interest charge of A$14,683.
 
 During
March 2007, the Company paid the amount owing to Joseph Gutnick, President and
Chief Executive Officer of Legend International Holdings, Inc. of $1,303, less
expenses incurred of A$472. No interest was incurred.
 
 6.
              
              AFFILIATE
      TRANSACTIONS
 
 In
December 2004, the Company issued to Renika, a company associated with Mr J I
Gutnick, 20,250,000 options to be converted into 20,250,000 shares of Common
Stock, at an exercise price of 5 cents and a latest exercise date of December
2009 for services to be rendered to the Company. The Company undertook a Black
and Scholes valuation of these options using a 2.22 cent exercise price, 2.22
cent market price, 5 year life, risk free interest rate of 5.155% and a
volatility of 16.7%.  The Company valued the 20,250,000 options at
A$160,672 (US$123,300) or A$0.0178 (US$0.0137) each. In September 2005, Renika
exercised the 20,250,000 options using the cashless exercise feature and were
issued 17,085,937 shares of Common Stock.
 
 In
December 2004, the Company entered into an agreement with AXIS Consultants Pty
Ltd to provide geological, management and administration services to the
Company.  AXIS is affiliated through common management.  The
Company is one of four affiliated companies. Each of the companies has some
common Directors, officers and shareholders.  In addition, each of the
companies is substantially dependent upon AXIS for its senior management and
certain mining and exploration staff. A number of arrangements and transactions
have been entered into from time to time between such companies.  It
has been the intention of the affiliated companies and respective Boards of
Directors that each of such arrangements or transactions should accommodate the
respective interest of the relevant affiliated companies in a manner which is
fair to all parties and equitable to the shareholders of each. Currently, there
are no material arrangements or planned transactions between the Company and any
of the other affiliated companies other than AXIS.
 
 AXIS is a
company owned by its public companies (including Legend) and any profits
generated by AXIS are returned to its shareholders in the form of
dividends.
 
 AXIS is
paid by each company for the costs incurred by it in carrying out the
administration function for each such company. Pursuant to the Service
Agreement, AXIS performs such functions as payroll, maintaining employee records
required by law and by usual accounting procedures, providing insurance, legal,
human resources, company secretarial, land management, certain exploration and
mining support, financial, accounting advice and services.  AXIS
procures items of equipment necessary in the conduct of the business of the
Company.  AXIS also provides for the Company various services,
including but not limited to the making available of office supplies, office
facilities and any other services as may be required from time to time by the
Company as and when requested by the Company.
 
 F-17
  The
Company is required to reimburse AXIS for any direct costs incurred by AXIS for
the Company.  In addition, the Company is required to pay a proportion
of AXIS’s overhead cost based on AXIS’s management estimate of our utilisation
of the facilities and activities of AXIS plus a service fee of not more than 15%
of the direct and overhead costs. Amounts invoiced by AXIS are required to be
paid by us.  The Company is also not permitted to obtain from sources
other than AXIS, and we are not permitted to perform or provide ourselves, the
services contemplated by the Service Agreement, unless we first requests AXIS to
provide the service and AXIS fails to provide the service within one
month.
 
 The
Service Agreement may be terminated by AXIS or us upon 60 days prior
notice.  If the Service Agreement is terminated by AXIS, the Company
would be required to independently provide, or to seek an alternative source of
providing, the services currently provided by AXIS.  There can be no
assurance that the Company could independently provide or find a third party to
provide these services on a cost-effective basis or that any transition from
receiving services under the Service Agreement will not have a material adverse
effect on us.  The Company’s inability to provide such services or to
find a third party to provide such services may have a material adverse effect
on our operations.
 
 In
accordance with the Service Agreement AXIS provides the Company with the
services of the Company’s Chief Executive Officer, Chief Financial Officer,
geologists and clerical employees, as well as office facilities, equipment,
administrative and clerical services. We pay AXIS for the actual costs of such
facilities plus a maximum service fee of 15%.
 
 During
2006, AXIS charged the Company A$203,664 in management fees and administration
services, A$212,679 for exploration services provided to the Company, charged
interest of A$13,498 on the outstanding balance, loaned us $4,500 and the
Company repaid A$180,000. AXIS charged interest at a rate of between 9.35% and
10.10% for 2006. AXIS did not charge a service fee for 2006. The amount owed to
AXIS at December 31, 2006 was A$312,253. During 2007, AXIS charged the Company
A$1,126,311 in management fees and administration services including salaries
incurred in relation to AXIS staff that provided services to the Company,
A$834,552 for exploration services, A$151,800 for asset usage, A$14,683 in
interest on the outstanding balance and the Company repaid A$2,432,687. AXIS
charged interest at a rate of 10.10% until June 2007. The amount owed to AXIS at
December 31, 2007 was $6,912 which is included in accounts payable.
 
 Mr Joseph
Gutnick, the President of the Company advanced the Company the initial deposit
on opening a US Dollar bank account. In March, 2007, the balance of A$831, owing
of the initial advance of A$1,303 (US$1,000) less expenses incurred of A$472,
was repaid.
 
 Effective
as of March 3, 2006, Legend entered into a Contract for the Sale of Mining
Tenements (“Contract”) with Astro Diamond Mines N.L. (“Astro”) an Australian
company pursuant to which the Company acquired certain diamond mining tenements
in Northern Australia from Astro. The consideration payable by Legend to Astro
was A$1.5 million and Legend was also required to pay to Astro any costs
incurred on the tenements after February 1, 2006.  Astro provided
commercial warranties which are usual for a transaction of this nature in favour
of Legend. Under Australian law, Astro was required to provide an independent
experts report to shareholders for this transaction. In order to prepare the
independent experts report, a mineral valuation was prepared on behalf of Astro
which indicated that the preferred value for the tenements that are the subject
of the transaction was A$1.5 million. This formed the basis of the consideration
agreed by the parties. The President and Chief Executive Officer of the Company,
Mr. J. I. Gutnick, was Chairman and Managing Director of Astro and Dr DS
Tyrwhitt, an independent Director of the Company is also a Director of Astro.
The tenements are located in the Northern Territory of Australia and are
prospective for all minerals. Astro incurred costs on the mining tenements from
February 1, 2006 which at settlement Legend was required to pay. However, Astro
had not quantified the amount at the date of settlement and it was only finally
quantified in November 2006. At December 31, 2006, the Company owed Astro
A$942,433 for these costs including interest of A$21,302. During 2007, the
amount was repaid in full including interest charge for 2007 of A$16,774. Astro
charged interest at a rate of 10.10%.
 
 The
consideration and all related acquisition costs, costs incurred by Astro since
February 1, 2006 and exploration expenditure incurred by the Company is shown in
the Statement of Operations as Exploration Expenditure.
  F-18
  7.
              
              INCOME
      TAXES
 
 The
Company has adopted the provisions of SFAS No. 109 "Accounting for Income
Taxes". SFAS 109 requires recognition of deferred tax liabilities and assets for
the expected future tax consequences of events that have been included in the
financial statements or tax returns. Under this method, deferred tax liabilities
and assets are determined based on the differences between the financial
statement and tax basis of assets and liabilities using enacted tax rates in
effect for the year in which the differences are expected to
reverse.
 
 The
Company has operations in both the USA and Australia and the Company is subject
to taxation in both jurisdictions on the operations in each respective
jurisdiction.
 
 At
December 31, 2007 and 2006 deferred taxes consisted of the
following:
 
 USA
                2007
                A$
              
              
              Australia
                2007
                A$
              
              
              Total
                2007
                A$Deferred
      tax assetsNet
      operating loss carry-forward
              
              
              1,756,879
              
              
              
              3,031,967
              
              
              
              4,788,846Less
      valuation allowance
              
              
              (1,756,879
              )
              
              
              (3,031,967
              )
              
              
              (4,788,846
              )Net
      deferred taxes
              
              
              -
              
              
              
              -
              
              
              
              -
 
 USA
                2006
                A$
              
              
              Australia
                2006
                A$
              
              
              Total
                2006
                A$Deferred
      tax assetsNet
      operating loss carry-forward
              
              
              1,313,017
              
              
              
              1,218,600
              
              
              
              2,531,617Less
      valuation allowance
              
              
              (1,313,017
              )
              
              
              (1,218,600
              )
              
              
              (2,531,617
              )Net
      deferred taxes
              
              
              -
              
              
              
              -
              
              
              
              -
 
 The
valuation allowance offsets the net deferred tax asset for which there is no
assurance of recovery. The valuation allowance will be evaluated at the end of
each year, considering positive and negative evidence about whether the deferred
tax asset will be realized.
 
 At that
time, the allowance will either be increased or reduced; reduction could result
in the complete elimination of the allowance if positive evidence indicates that
the value of the deferred tax assets is no longer impaired and the allowance is
no longer required.
 
 As a
result of the ownership change that occurred in November 2004 (see note 1),
Internal Revenue Code Section 382 limits the use of available operating loss
carryforwards for losses incurred prior to the ownership change.  In
addition, the Company will need to file a tax return for 2006 to establish the
tax benefits of the net operating loss carry forwards. Future net operating
losses will be fully available to offset future taxable income.  Total
available net operating loss carryforwards, which are subject to limitations,
amount to approximately A$15,273,850 at December 31, 2007 and expire in years
2022 through 2026
 
 8.
              
              COMMITMENTS
 
 During
December 2006, the Company entered into an operating lease agreement for a motor
vehicle which expires in 2008. The lease agreement has a monthly repayment
amount of A$1,123. The future minimum lease repayments under a non-cancellable
lease at December 31, 2007 is A$11,230 (US$9,845) for 2008.
 
 During
July 2007, the Company entered into a sublease agreement for the rental of
office premises which expires in 2008. The total rental payment for 2007 is
A$27,457 (US$24,072), for the security bond of A$16,615 (US$14,566), and for
2008, A$103,241 (US$90,511).
 
 F-19
  During
September 2007, the Company entered into a commercial hire purchase agreement
for proposed on-site accommodation units, which expires in 2008. The hire
purchase agreement has a monthly repayment amount of A$20,954 and a final
repayment of A$174,280 in June 2008. The future minimum lease repayments under a
non-cancellable lease at December 31, 2007 are A$89,945 (US$78,854) and interest
of A$17,078 (US$14,972).
 
 Exploration
 
 The
Company has to perform minimum exploration work and expend minimum amounts of
money on its tenements. The overall expenditure requirement tends to be limited
in the normal course of the Company’s tenement portfolio management through
expenditure exemption approvals, and expenditure reductions through
relinquishment of parts or the whole of tenements deemed non prospective. Should
the company wish to preserve interests in its current tenements the amount which
may be required to be expended is as follows:
 
 2007
                A$
              
              
              
              2006
                A$Not
      later than one year
              
              
              1,795,000
              
              
              
              860,000Later
      than one year but not later than five years
              
              
              3,085,000
              
              
              
              875,000Later
      than five years but not later than twenty one years
              
              
              115,000
              
              
              
              -4,995,000
              
              
              
              1,735,000
 
 9.
              
              RECLAMATION
      AND REHABILITATION
 
 The
Company’s exploration activities are subject to various federal and state laws
and regulations governing the protection of the environment. These laws and
regulations are continually changing and are generally becoming more
restrictive. The Company conducts its operations so as to protect the
environment and believes its operations are in compliance with applicable laws
and regulations in all material respects. The Company has made, and expects to
make in the future, expenditures to comply with such laws and regulations, but
cannot predict the full amount of such future expenditures. Estimated future
reclamation costs are based principally on legal and regulatory
requirements.
 
 10.
              
              DEPOSITS
 
 Deposits
              
              
              2007
                A$
              
              
              
              2006
                A$Cash
      deposits have been provided to the Department of Business, Industry and
      Resource Development of Northern Territory for the purpose of guaranteeing
      the Company’s performance in accordance with Northern Territory mining law
      (refer footnote 9).The
      performance relates to the requirement that the Company adheres to the
      terms and conditions of its exploration licences, which inter alia
      requires site restoration. However, the Directors do not anticipate the
      Department of Business, Industry and Resource Development of Northern
      Territory will exercise these guarantees as the Company adheres to all
      conditions of its exploration licences.
              
              
              130,000
              
              
              
              90,000
 
 11.
              
              SUBSEQUENT
      EVENTS
 
 On
February 7, 2008, the Board of Directors of the Company agreed to issue
5,000,000 options under the 2006 Incentive Option Plan to the President and
Chief Executive Officer. The options have an exercise price of US$2.00, vest 1/3
on February 7, 2009, 1/3 on February 7, 2010 and 1/3 on February 7, 2011. The
latest exercise date is February 7, 2018. The Company has appointed an external
consultant to provide a valuation of the options.
 
 On
February 18, 2008, the Board of Directors of the Company agreed to issue 400,000
options under the 2006 Incentive Option Plan. The options have an exercise price
of US$1.00, vest 1/3 on February 18, 2009, 1/3 on February 18, 2010 and 1/3 on
February 18, 2011. The latest exercise date is February 18, 2018. The Company
has appointed an external consultant to provide a valuation of the
options.
 
 F-20
  Effective
February 27, 2008, the Company entered into a Share Sale Agreement whereby the
Company agreed to purchase all of the issued and outstanding shares of Teutonic
Minerals Pty Ltd. As a result, Teutonic became a subsidiary of the Company from
that date. Teutonic holds an application for a mineral licence over phosphate in
the Georgina Basin in the State of Queensland, Australia. The consideration
payable to the vendors was A$300,000 in cash, and the Company granted a 1% gross
revenue royalty from production from the mineral licence.
  F-21
 
 CERTIFICATE
OF AMENDMENT
 OF
 CERTIFICATE
OF INCORPORATION OF
 LEGEND
INTERNATIONAL HOLDINGS, INC.
 (Under
section 242 of the General Corporation Law)
  Legend
International Holdings, Inc., a corporation organized and existing under the
General Corporations Law of the State of Delaware (the "Corporation"), does
hereby certify that:
  FIRST:                          
The name of the Corporation is Legend International Holdings, Inc.
  SECOND:                      The
Certificate of Incorporation is hereby amended by striking out Article “FOURTH”
thereof and by substituting in lieu of said Article the following
provisions:
  “FOURTH:  The
total number of shares of stock which the Corporation is authorized to issue is
320,000,000, consisting of 300,000,000 shares of Common Stock having a par value
of $.001 per shares and 20,000,000 shares of Preferred Stock having a par value
of $.001 per share and to be issued in such series and to have such rights,
preferences, and designation as determined by the Board of Directors of the
Corporation.”
  THIRD:                      The
Amendment to the Certificate of Incorporation herein certified has been duly
adopted in accordance with the provision of Section 211 and 242 of the General
Corporations Law of the State of Delaware.
  IN WITNESS
WHEREOF, the undersigned has executed this certificate this 3rd day of
December 2007.
  /s/ Peter J. LeePeter
      J. Lee,
Secretary