RNS Number:4677B
Gippsland Limited
13 April 2006
GIPPSLAND LIMITED
NOTICE OF EXTRAORDINARY GENERAL MEETING
AND
EXPLANATORY STATEMENT
For an Extraordinary General Meeting to be held on
Tuesday 16th May 2006 at 10.00am (Perth Time) at
18 Stirling Highway, Nedlands, Western Australia.
GIPPSLAND LIMITED
ABN 31 004 766 376
NOTICE OF EXTRAORDINARY GENERAL MEETING
Notice is given of an Extraordinary General Meeting of shareholders of Gippsland
Limited (Gippsland or the Company) will be held at 18 Stirling Highway,
Nedlands, Western Australia at 10.00am (Perth Time) on Tuesday 16th May 2006.
AGENDA
BUSINESS
The Explanatory Statement which accompanies and forms part of this Notice
describes the matters to be considered as ordinary business. Certain
abbreviations and other defined terms are used throughout this Notice. Defined
terms are generally identifiable by the use of an upper case first letter.
Details of the definitions and abbreviations used are set out in the Glossary
contained in the Explanatory Statement.
ORDINARY BUSINESS
Resolution 1: Ratify Previous Issue of 24,000,000 Shares at 5 UK Pence (approx
11.8 Australian cents) per Share
To consider and, if thought fit, to pass the following resolution as an ordinary
resolution:
"That, pursuant to Rule 7.4 of the Listing Rules of the ASX and for all other
purposes, the Company approves and ratifies the allotment and issue of
24,000,000 Shares in the Company at an issue price of 5 UK Pence (approx 11.8
Australian cents) per Share (to raise #1,200,000 (approx A$2.84 million) before
expenses) made on 16 March 2006 to various clients of the United Kingdom
stockbroking firm Hoodless Brennan".
The Company will disregard any votes cast on Resolution 1 by any person who
participated in the issue and any person associated with those persons. However,
the Company need not disregard a vote if it is cast by a person as proxy for a
person who is entitled to vote, in accordance with the directions on the proxy
form or it is cast by the person chairing the meeting as proxy for a person who
is entitled to vote, in accordance with a direction on the proxy form to vote as
the proxy decides.
Resolution 2: Ratify Previous Issue of 6,000,000 Shares to settle Aguero dispute
To consider and, if thought fit, to pass the following resolution as an ordinary
resolution:
"That, pursuant to Rule 7.4 of the Listing Rules of the ASX and for all other
purposes, the Company approves and ratifies the allotment and issue of 6,000,000
Shares in the Company for Nil consideration to Alex Aguero and Hillcrest
Litigation Services Limited in full and complete settlement of the Aguero
dispute".
The Company will disregard any votes cast on Resolution 2 by any person who
participated in the issue and any person associated with those persons. However,
the Company need not disregard a vote if it is cast by a person as proxy for a
person who is entitled to vote, in accordance with the directions on the proxy
form or it is cast by the person chairing the meeting as proxy for a person who
is entitled to vote, in accordance with a direction on the proxy form to vote as
the proxy decides.
Resolution 3: Approval of International Finance Corporation ("IFC") mandate to
arrange Abu Dabbab Project Financing and associated share issues
To consider and, if thought fit, to pass the following resolution as an ordinary
resolution:
"That, pursuant to Rule 7.1 of the Listing Rules of the ASX and for all other
purposes, the Company approves and authorizes the Directors of the Company to
allot and issue to the IFC as part of the Abu Dabbab Project Financing Mandate
the following new shares:
a) Up to 2,250,000 new shares to be issued for Nil consideration in
three equal tranches upon each financing milestone being reached; and
b) Up to 25,000,000 Shares in the capital of the Company at an
issue price of US$0.08 (approximately 10.8 Australian cents) per Share, or 90%
of the VWAP over the previous 5 days prior to subscription which ever is lower,
and a further 25 million free attaching unlisted options with an exercise price
of 13.5 Australian cents exercisable within 6 years of issue and otherwise on
the terms and conditions set out in the Explanatory Statement accompanying the
Notice of Extraordinary General Meeting".
The Company will disregard any votes cast on Resolution 3 by any person who
participated in the issue and any person associated with those persons. However,
the Company need not disregard a vote if it is cast by a person as proxy for a
person who is entitled to vote, in accordance with the directions on the proxy
form or it is cast by the person chairing the meeting as proxy for a person who
is entitled to vote, in accordance with a direction on the proxy form to vote as
the proxy decides.
Resolution 4: Approval of the Issue of 50,000,000 Shares
To consider and, if thought fit, to pass the following resolution as an ordinary
resolution:
"That, pursuant to Listing Rule 7.1 of the Listing Rules of the Australian Stock
Exchange Limited and for all other purposes, the Company approve and authorise
the Directors of the Company to allot and issue up to 50,000,000 Shares in the
capital of the Company at an issue price which is at least 90% of the average
market price for the Company's shares on ASX over the 5 trading days preceding
the date on which the issue is made and otherwise on the terms and conditions
set out in the Explanatory Statement accompanying this Notice of Extraordinary
General Meeting."
The Company will disregard any votes cast on Resolution 4 by any person who may
participate in the proposed issue and by any person who might obtain a benefit,
except a benefit solely in the capacity of a shareholder, if the resolution is
passed and any person associated with those persons. However, the Company need
not disregard a vote if it is cast by a person as proxy for a person who is
entitled to vote, in accordance with the directions on the proxy form or it is
cast by the person chairing the meeting as proxy for a person who is entitled to
vote, in accordance with a direction on the proxy form to vote as the proxy
decides.
DATED THIS 10 APRIL 2006
BY ORDER OF THE BOARD
Mr RS (Sam) Middlemas
Company Secretary
GIPPSLAND LIMITED
ABN 31 004 766 376
EXPLANATORY STATEMENT
This Explanatory Statement and all attachments are important documents. They
should be read carefully.
If you have any questions regarding the matters set out in this Explanatory
Statement or the preceding Notice, please contact the Company, your stockbroker
or other professional adviser.
Certain abbreviations and other defined terms are used throughout this
Explanatory Statement. Defined terms are generally identifiable by the use of an
upper case first letter. Details of the definitions and abbreviations used are
set out in the Glossary contained in this Explanatory Statement.
1. GENERAL INFORMATION
This Explanatory Statement has been prepared for the shareholders of Gippsland
Limited (Gippsland or the Company) in connection with the Extraordinary General
Meeting of the Company to be held on Tuesday 16th May 2006.
2. RESOLUTION 1 - RATIFY PREVIOUS ISSUE OF 24 MILLION SHARES AT 5 UK PENCE
(APPROX 11.8 AUSTRALIAN CENTS) PER SHARE
Listing Rule 7.4 permits the ratification of previous issues of securities made
without prior shareholder approval, provided the issue did not breach the 15%
threshold set by Listing Rule 7.1. The effect of such a ratification is to
restore a company's maximum discretionary power to issue further shares up to
15% of the issued capital of the company without requiring shareholder approval.
Resolution 1 has been included so that shareholders may ratify pursuant to
Listing Rule 7.4 the previous issue, made on 16 March 2006, of 24,000,000 Shares
at an issue price of 5 UK Pence (approx 11.8 Australian cents) per Share (to
raise #1,200,000 (approx A$2.84 million) before expenses) to various clients of
the United Kingdom stockbroking firm Hoodless Brennan.
The funds raised will be used to expand Gippsland's management team including
key positions in finance, operations, project management, metallurgy and geology
as the Company moves from an exploration company to a world scale mining
operation. In addition the funds will be used to continue the exploration of the
Company's Wadi Allaqi gold projects.
The Company currently has 201,818,359 Shares on issue which are listed on ASX
and AIM. The Company currently has on issue 43,771,393 Listed Options each with
an exercise price of 9 cents and expiring on 31 December 2007 which are listed
on ASX and AIM. These aforementioned figures include the Shares the subject of
this Resolution 1. The Company also has on issue 10,000,000 Unlisted Options
each with an exercise price of 4.0 UK pence and expiring on 31 December 2007,
and 2,250,000 Unlisted Options with an exercise price of 15 cents and expiring
on 31 December 2007.
The Company wishes to ratify this issue pursuant to Listing Rule 7.4, in order
to allow the Company to have the right to place up to a further 15% of its
issued capital at any time during the next 12 months. The information required
to be given to shareholders pursuant to Listing Rule 7.5 is contained in both
this Explanatory Statement and the notes to Resolution 1 as set out in the
Notice of Extraordinary General Meeting. All Shares issued pursuant to
Resolution 1 ranked equally with the existing ordinary shares on issue.
3. RESOLUTION 2 - RATIFY PREVIOUS ISSUE OF 6,000,000 SHARES TO SETTLE AGUERO
DISPUTE
As previously disclosed to the marketplace, there was a legal dispute between
one of Gippsland's investee companies Here2win.com Pty Ltd ("Here2win"), and the
former Managing Director of Here2win Mr Alex Aguero ("Aguero"). The dispute
surrounded the establishment and performance requirements of Aguero in 1999 of a
business selling to internet users a horse racing gaming product, which led to
the termination of Aguero.
In 2001 Aguero commenced an action against Gippsland in the Supreme Court of
Western Australia alleging a breach of the Deed and entitlement to certain
benefits under the Deed, and the trial was listed to be heard in the Supreme
Court of Western Australia commencing 17 March 2006.
Gippsland made a number of settlement offers to Aguero, due to the uncertainty
surrounding the outcome of the trial, and the increasing level of management
time involved in preparation for the trial. It was finally agreed to settle the
dispute with Aguero by the offer of 6,000,000 Shares for Nil consideration, with
3,600,000 Shares payable to Aguero, and 2,400,000 payable to Hillcrest
Litigation Services Ltd ("Hillcrest"), who financed Aguero's litigation costs.
The Company now seeks shareholders approval to ratify the previous issue of
these 6,000,000 shares Nil consideration in full and complete satisfaction of
the Aguero dispute.
The board considers the resolution for the matter to be a sound commercial
outcome for the Company.
4. RESOLUTION 3 - APPROVAL OF IFC MANDATE TO ARRANGE ABU DABBAB PROJECT
FINANCING AND ASSOCIATED SHARE ISSUES
The Company announced on 7 March 2006, an agreement entered into with the
International Finance Corporation ("IFC"), a member of the World Bank Group to
take a lead role in arranging the debt requirements of the Abu Dabbab
Tantalum-Tin project in Egypt. As part of that mandate, the Company has agreed
to pay the IFC's a total of 2,250,000 fully paid ordinary shares as a fee in
respect of the finance arranging role. The shares will be issued in three equal
tranches upon certain commercial financing milestones being satisfied. The IFC
has also been granted a 3 month option to subscribe for 25,000,000 new shares at
an issue price of US$0.08 (approx A$0.108) per share, (or the VWAP over the
previous 5 trading days prior to issue, whichever is lower) to raise
US$2,000,000, and 25,000,000 free attaching unlisted options having an exercise
price of A$0.135 any time prior to six years from the issue date. Further
details of the mandate are included in the ASX announcement released on 7 March
2006.
Listing Rule 7.1
Listing Rule 7.1 provides that a listed company may not issue securities in any
12 month period where the total number of securities to be issued exceeds 15% of
the number of fully paid ordinary securities on issue 12 months before the date
of issue, except with the prior approval of members of the company in general
meeting of the terms and conditions of the proposed issue or where the issue is
pro rata to all shareholders in accordance with their existing shareholdings.
The proposed issue to the IFC under the option would be in excess of this, and
therefore prior Shareholder approval is required.
The Company will use these funds raised by the issue to assist in the
development of the Abu Dabbab tantalum, tin and feldspar deposit located in
Egypt.
For the purposes of Listing Rule 7.3, the following information is provided in
relation to Resolution 3 to allow shareholders to assess the proposed issue
under the option agreement to the IFC:
(a) the maximum number of Shares in the capital of the Company to be
allotted and issued is 27,250,000 Shares, and 25,000,000 unlisted options
convertible into ordinary shares;
(b) the Shares and unlisted options the subject of Resolution 3 will
be issued and allotted no later than (3) months after the date of this
Extraordinary General Meeting;
(c) the 2,250,000 will be issued for Nil consideration to meet the
fees in respect of the finance arranging role with the balance of
25,000,000 Shares proposed to be allotted and issued at a price equal to at
least the VWAP price of the Company's shares on ASX over 5 trading days
preceding the day on which the issue is made;
(d) the allottees in respect of Resolution 3 is the IFC;
(e) the Shares to be issued will rank pari passu on allotment and
issue with the existing Shares of the Company; and
(f) the Company will use the funds raised by the issue to provide
capital for the development of the Company's Abu Dabbab tantalum, tin and
feldspar deposit located in the Abu Dabbab area of the Central Eastern
Desert of the Arab Republic of Egypt.
5. RESOLUTION 4 - APPROVAL OF THE ISSUE OF 50,000,000 SHARES
Following the mandate given to the IFC to arrange financing for the Abu Dabbab
project, the Company will be required to meet its requirement of an equity
component of up to 40% of the total cost of the project. The current project
cost is anticipated to be US$90 million, with an equity component of up to US$35
million.
As a consequence the Company is seeking prior shareholder approval (as required
under listing rule 7.1) to permit it to issue up to 50,000,000 Shares via a
placement, at an issue price equal to at least 90% of the average market price
of the Company's Shares on ASX over 5 trading days preceding the day on which
the placement is issued.
The Company will use these funds raised to meet part of its equity commitments
to develop the Company's Abu Dabbab tantalum, tin and feldspar deposit located
in the Abu Dabbab area of the Central Eastern Desert of the Arab Republic of
Egypt.
For the purposes of Listing Rule 7.3, the following information is provided in
relation to Resolution 3 to allow shareholders to assess the proposed issue of
up to 50,000,000 Shares as contemplated by Resolution 4:
(a) the maximum number of Shares in the capital of the Company to be
allotted and issued is 50,000,000 Shares;
(b) the Shares the subject of Resolution 4 will be issued and
allotted no later than (3) months after the date of this Extraordinary
General Meeting (unless an ASX extension is granted if required);
(c) the issue price of the Shares proposed to be allotted and issued
will be a price equal to at least 90% of the average market price of the
Company's shares on ASX over 5 trading days preceding the day on which the
placement is made;
(d) the allottees in respect of Resolution 4 are not, as yet,
identifiable, but will be subscribers to be identified by the Company and
any brokers appointed by the Company to manage the issue;
(e) in relation to Resolution 4, by way of an example, in the event
that the Company's share price was 20 cents, then 90% of this price is 18
cents. 50,000,000 shares at 18 cents per share totals to $9,000,000
(before costs);
(f) the Shares to be issued will rank pari passu on allotment and
issue with the existing Shares of the Company; and
(g) the Company will use the funds raised by the issue of the 50,000,000
Shares the subject of Resolution 4 to meet its equity commitments to
develop of the Company's Abu Dabbab tantalum, tin and feldspar deposit
located in the Abu Dabbab area of the Central Eastern Desert of the Arab
Republic of Egypt.
6. ENQUIRIES
Shareholders are invited to contact the Company Secretary, Sam Middlemas on (08)
9389 8611 if they have any queries in respect of the matters set out in these
documents.
GLOSSARY
"AIM" means the Alternative Investment Market of the London Stock
Exchange;
"ASX" means Australian Stock Exchange Limited;
"Company" or means Gippsland Limited ABN 31 004 766 376;
"Gippsland"
"Corporations Act" means the Corporations Act 2001 (Cth);
"Directors" means the directors of the Company;
"IFC" means International Finance Corporation, part of the World
Bank Group;
"Listed Option" means an option to acquire one Share exercisable at 9 cents
and expiring on 31 December 2007, on the terms and
conditions set out in Annexure A to the Explanatory
Statement accompanying this Notice;
"Listing Rules" means the Listing Rules of ASX;
"Notice" or "Notice means the notice of meeting which accompanies this
of Extraordinary Explanatory Statement (including Annexures A and B);
General Meeting"
"Shares" means fully paid ordinary shares in the Company; and
"Unlisted Option" means an option to acquire one Share exercisable at 4.0 UK
pence (which equates to 9.0 Australian cents) per Share and
expiring on 31 December 2007 on the terms and conditions set
out in Annexure B to the Explanatory Statement accompanying
this Notice.
ANNEXURE A
TERMS OF UNLISTED OPTIONS
The following are the rights attaching to the 25,000,000 Unlisted Options that
are the subject of Resolution 3 being put before shareholders.
* The options will be issued for $Nil consideration;
* An option certificate will be issued for the 25,000,000 options;
* The options will expire six years from the issue date ("Expiry Date");
* The option is a right in favour of the option holder to subscribe for
one share;
* The option holder may exercise options any time prior to the Expiry
Date;
* Shares allotted to option holders on exercise of options will be issued
at 13.5 cents each ("Exercise Price");
* The Exercise Price of shares the subject of the options will be payable
in full on exercise of the options;
* Options will be exercisable by the delivery to the registered office of
the Company of a notice in writing stating the intention of the option
holder to:
(a) exercise all or a specified number of options (but in multiples of
100,000); and
(b) pay the subscription monies in full for the exercise of each option
("Notice").
* The Notice must be accompanied by the option certificate and a cheque
made payable to the Company for the subscription monies for the shares. An
exercise of only some options will not affect the rights of the option
holder to the balance of the options held by the option holder. The Notice
must be received by the Company prior to the Expiry Date.
* The Company will allot the resultant shares and deliver the holding
statement within ten (10) business days of the exercise of the options;
* The Company will not apply for Official Quotation on ASX and AIM of any
of the options;
* The options will not be transferable;
* Shares allotted pursuant to an exercise of the options shall rank, from
the date of allotment, equally with existing ordinary fully paid shares of
the Company in all respects;
* The Company will in accordance with the Listing Rules make application
to have shares allotted pursuant to an exercise of options listed for
Official Quotation on ASX and AIM;
* In the event of any reconstruction (including consolidation, subdivision,
reduction or return) of the authorised or issued capital of the
Company, the number of the options or the exercise price of the options or
both will be reconstructed (as appropriate) in accordance with the Listing
Rules of ASX; and
* The options will not give any right to participate in dividends, bonus
issues or new issues until shares are allotted pursuant to the exercise of
the relevant options. There is no right to change the exercise price of
options if the Company completes a bonus or new issue.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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