TIDMSOLG
SolGold PLC
26 November 2020
26 November 2020
SolGold plc
("SolGold" or the "Company")
Annual General Meeting
Disapplication Resolutions Explained
The Board of Directors of SolGold (LSE & TSX: SOLG) is
pleased to provide shareholders with an explanation of the
disapplication resolutions to be put forward at the Annual General
Meeting ("AGM")which is scheduled to take place as a virtual
meeting hosted on the Lumi platform on 17 December 2020 at 11am
London time (GMT).
Shareholders are referred to the section below titled 'General
Voting Instructions' for details on how to vote.
One of the leading proxy advisor agencies has released its
voting recommendation report for the Company's 2020 AGM and has
recommended shareholders vote in favour of the Resolutions
explained below (Resolutions 11, 13 and 14).
Resolution 11 - Renewal of General Board Authority to Allot
Shares (Ordinary Resolution)
Under UK legislation, Directors cannot allot shares without
authority from shareholders. The authority must be renewed each
year and is a standard recurring resolution for most listed
companies.
Resolution 11 is drafted to comply with the Share Capital
Management Guidelines (the "Guidelines") issued by the Investment
Association ("IA") which represents the views of institutional
investors in the UK. The restrictions in the Guidelines (in
conjunction with certain other restrictions in the other
resolutions) ultimately provide protection against shareholder
dilution.
Resolution 11 reflects the restrictions in the Guidelines and
has to be read in conjunction with Resolutions 13 and 14:
Ø Resolution 11 gives SolGold authority to allot new shares up
to two-thirds of its issued share capital (GBP13,814,756), subject
to certain restrictions.
Ø SolGold can issue up to 5% of its issued share capital
(GBP1,036,106) on a non-pre-emptive basis (i.e. not to existing
shareholders, by way of a placing for example) and the money raised
can be used for any purpose (permitted by Resolution 13).
Ø Aligned with the Pre-Emption Group Statement of Principles and
common practice of LSE listed companies, SolGold can issue up to an
additional 5% of its issued share capital (a further GBP1,036,106)
on a non-pre-emptive basis (for example by way of a placing) but
the money raised can only be used for an acquisition or specified
capital investment (permitted by Resolution 14).
Ø Any other issues of shares must be made in accordance with
Resolution 13(i), namely they need to be offered to all
shareholders in proportion to their existing shareholdings (i.e. on
a pre-emptive basis). The type of pre-emptive offering must satisfy
the definition of pre-emption in Resolution 13(i) (not the
definition in the Companies Act as this has been disapplied by
Resolution 13) (see below for more information).
Ø Of the two-thirds of the issued share capital which SolGold
has authority to allot, up to one-third (GBP6,907,378) can be used
for unrestricted use (in practice a rights issue or an open offer)
(see Resolution 11(a)). Any amount in addition to this can only be
used for a rights issue (see Resolution 11(b)).
Ø Examples: in light of the above, SolGold could undertake:
-- a rights issue of up to two-thirds of its issued share
capital (GBP13,814,756). If it did, it would have used up its
ability to raise funds via an open offer or a placing; or
-- an open offer of up to one-third of its issued share capital
(GBP6,907,378). If it did, the only other allotment it could make
in the year would be a rights issue of up to one third of its
issued share capital (GBP6,907,378); or
-- a placing of up to 5% of its issued share capital
(GBP1,036,106) (money to be used for any purpose), a placing for an
additional 5% (GBP1,036,106) (money to be used for an acquisition)
and a rights issue in respect of the remaining 56.66%
(GBP11,742,544).
Resolution 13 - Disapplication of Pre-emption Rights in the
Companies Act 2006 (s.561) (Special Resolution)
Ø If Directors wish to allot new shares for cash, the Companies
Act requires that these shares are offered first to shareholders in
proportion to their existing holdings.
Ø Resolution 13 seeks authority for the company to allot new
shares (and other equity securities) or sell treasury shares, for
cash without first offering them to existing shareholders on a pro
rata basis. It is a standard recurring resolution for most listed
companies.
Ø The ability to issue shares non pre-emptively is restricted by
the guidance issued by the IA which only supports the
disapplication of pre-emption rights in respect of allotments
representing no more than 5% of the issued ordinary share capital
(exclusive of shares held in treasury), without restriction as to
the use of proceeds.
Ø Although the pre-emption rights in the Companies Act are
disapplied, they are replaced by pre-emption rights on the terms
provided for in the resolution. The pre-emption rights in the
resolution provides the Company with flexibility to finance
business opportunities, conduct pre-emptive offers or rights issues
without needing to comply with the strict requirements of the
statutory pre-emptive provisions. There are three (3) main
benefits:
-- enables fractional entitlements to shares to be sold in the
market for the benefit of the Company;
-- allows more flexible arrangements with overseas shareholders than permitted under s.561; and
-- enables a company to (i) extend the offer to holders of
classes of securities which do not qualify for pre-emption rights
but which carry a contractual right to participate in a rights
issue or (ii) exclude shares which are ordinary shares and which
would not ordinarily participate in a rights issue (for example,
preference shares).
Resolution 14 - Further Disapplication of Pre-emption Rights
(Special Resolution)
Ø This resolution authorises the Directors to allot an
additional quantity of shares (or sell treasury shares) for cash
otherwise than on a pro-rata basis to existing shareholders,
provided that such shares are used only in connection with an
acquisition or specified capital investment (i.e. for a purpose
which adds value to the business - the shares cannot be used as a
mechanism for a general fund raise).
Ø The resolution is drafted to be aligned with the Pre-Emption
Group Statement of Principles. The Group supports the annual
disapplication of pre-emption rights in respect of allotments of
shares representing no more than an additional 5% of issued
ordinary share capital.
Ø The right to allot an additional 5% on a non-pre-emptive basis
designed to limit the use by companies of cash box placings to
raise extra funds.
Ø Separate resolutions are passed to disapply pre-emption rights
for each 5% to ensure (in particular) that shareholders have the
option to vote against the request to allot additional 5%
non-pre-emptively.
***************
General Voting Instructions
In order to follow the Directors' recommendations at the
forthcoming AGM, please contact your broker (or other registered
holder) directly and instruct them how to vote on your behalf.
The voting deadline is 11:00 a.m. (London time) on 15 December
2020, however your Private Client Broker will have an earlier
deadline. It is best to instruct them as soon as possible.
There is also the option to vote electronically during the
virtual meeting on 17 December 2020. Please head to
https://www.solgold.com.au/notice-of-meetings/ for more information
on how to access the online Lumi system.
CMi2i are the official Information Agent to SolGold. Should you
have any questions regarding the voting process, please contact
CMi2i on 0800 029 4356 or + 44 (0) 20 8187 1429. Alternatively, you
may e-mail your enquiries to solgold@cmi2i.com .
By order of the Board
Karl Schlobohm
Company Secretary
CONTACTS
Nicholas Mather Tel: +61 (0) 7 3303 0665
SolGold Plc (Chief Executive Officer)
nmather@solgold.com.au
Karl Schlobohm
SolGold Plc (Company Secretary) Tel: +61 (0) 7 3303 0661
kschlobohm@solgold.com.au
Ingo Hofmaier
SolGold Plc (GM - Project & Corporate Tel: +44 (0) 20 3823 2131
Finance) ihofmaier@solgold.com.au
Gordon Poole / Nick Hennis
Camarco (Financial PR / IR) Tel: +44 (0) 20 3757 4997
solgold@camarco.co.uk
Andrew Chubb Tel: +44 (0) 20 7907 8500
Hannam & Partners (Joint Broker and Financial
Advisor)
solgold@hannam.partners
Ross Allister / David McKeown Tel: +44 (0)20 7418 8900
Peel Hunt (Joint Broker and Financial
Advisor)
solgold@peelhunt.com
James Kofman / Darren Wallace Tel: +1 416 943 6411
Cormark Securities Inc. (Financial Advisor)
dwallace@cormark.com
Clayton Bush / Scott Mathieson Tel: +44 (0) 20 3100 2184
Liberum (Joint Broker and Financial Advisor)
Clayton.Bush@liberum.com
Follow us on twitter @SolGold_plc
ABOUT SOLGOLD
SolGold is a leading resources company focussed on the
discovery, definition and development of world-class copper and
gold deposits. In 2018, SolGold's management team was recognised by
the "Mines and Money" Forum as an example of excellence in the
industry and continues to strive to deliver objectives efficiently
and in the interests of shareholders. SolGold is the largest and
most active concession holder in Ecuador and is aggressively
exploring the length and breadth of this highly prospective and
gold-rich section of the Andean Copper Belt.
The Company operates with transparency and in accordance with
international best practices. SolGold is committed to delivering
value to its shareholders, while simultaneously providing economic
and social benefits to impacted communities, fostering a healthy
and safe workplace and minimizing the environmental impact.
Dedicated stakeholders
SolGold employs a staff of over 700 employees of whom 98% are
Ecuadorean. This is expected to grow as the operations expand at
Alpala, and in Ecuador generally. SolGold focusses its operations
to be safe, reliable and environmentally responsible and maintains
close relationships with its local communities. SolGold has engaged
an increasingly skilled, refined and experienced team of
geoscientists using state of the art geophysical and geochemical
modelling applied to an extensive database to enable the delivery
of ore grade intersections from nearly every drill hole at Alpala.
SolGold has over 80 geologists on the ground in Ecuador exploring
for economic copper and gold deposits.
About Cascabel and Alpala
The Alpala deposit is the main target in the Cascabel
concession, located on the northern section of the heavily endowed
Andean Copper Belt, the entirety of which is renowned as the base
for nearly half of the world's copper production. The project area
hosts mineralisation of Eocene age, the same age as numerous Tier 1
deposits along the Andean Copper Belt in Chile and Peru to the
south. The project base is located at Rocafuerte within the
Cascabel concession in northern Ecuador, an approximately
three-hour drive on sealed highway north of the capital Quito,
close to water, power supply and Pacific ports.
Having fulfilled its earn-in requirements, SolGold is a
registered shareholder with an unencumbered legal and beneficial
85% interest in ENSA (Exploraciones Novomining S.A.) which holds
100% of the Cascabel concession covering approximately 50km(2) .
The junior equity owner in ENSA is required to repay 15% of costs
since SolGold's earn in was completed, from 90% of its share of
distribution of earnings or dividends from ENSA or the Cascabel
concession. It is also required to contribute to development or be
diluted, and if its interest falls below 10%, it shall reduce to a
0.5% NSR royalty which SolGold may acquire for US$3.5million.
Advancing Alpala towards development
The resource at the Alpala deposit contains a high-grade core
which will be targeted to facilitate early cashflows and an
accelerated payback of initial capital. SolGold is currently
progressing its Pre-Feasibility Study and is fully funded through
to development decision following the Net Smelter Royalty Financing
with Franco-Nevada Corporation for US$100million. Franco-Nevada
will receive a perpetual 1% NSR interest from the Cascabel licence
area.
SolGold is currently assessing financing options available to
the Company for the development of the Alpala mine following
completion of the Definitive Feasibility Study.
SolGold's Regional Exploration Drive
SolGold is using its successful and cost-efficient blueprint
established at Alpala, and Cascabel generally, to explore for
additional world class copper and gold projects across Ecuador.
SolGold is the largest and most active concessionaire in
Ecuador.
The Company wholly owns four other subsidiaries active
throughout the country that are now focussed on thirteen high
priority gold and copper resource targets, several of which the
Company believes have the potential, subject to resource definition
and feasibility, to be developed in close succession or even on a
more accelerated basis compared to Alpala.
SolGold is listed on the London Stock Exchange and Toronto Stock
Exchange (LSE/TSX: SOLG). The Company has on issue a total of
2,072,213,494 fully-paid ordinary shares and 113,175,000 share
options.
Quality Assurance / Quality Control on Sample Collection,
Security and Assaying
SolGold operates according to its rigorous Quality Assurance and
Quality Control (QA/QC) protocol, which is consistent with industry
best practices.
Primary sample collection involves secure transport from
SolGold's concessions in Ecuador, to the ALS certified sample
preparation facility in Quito, Ecuador. Samples are then air
freighted from Quito to the ALS certified laboratory in Lima, Peru
where the assaying of drill core, channel samples, rock chips and
soil samples is undertaken. SolGold utilises ALS certified
laboratories in Canada and Australia for the analysis of
metallurgical samples.
Samples are prepared and analysed using 100g 4-Acid digest ICP
with MS finish for 48 elements on a 0.25g aliquot (ME-MS61).
Laboratory performance is routinely monitored using umpire assays,
check batches and inter-laboratory comparisons between ALS
certified laboratory in Lima and the ACME certified laboratory in
Cuenca, Ecuador.
In order to monitor the ongoing quality of its analytical
database, SolGold's QA/QC protocol encompasses standard sampling
methodologies, including the insertion of certified powder blanks,
coarse chip blanks, standards, pulp duplicates and field
duplicates. The blanks and standards are Certified Reference
Materials supplied by Ore Research and Exploration, Australia.
SolGold's QA/QC protocol also monitors the ongoing quality of
its analytical database. The Company's protocol involves
Independent data validation of the digital analytical database
including search for sample overlaps, duplicate or absent samples
as well as anomalous assay and survey results. These are routinely
performed ahead of Mineral Resource Estimates and Feasibility
Studies. No material QA/QC issues have been identified with respect
to sample collection, security and assaying.
Reviews of the sample preparation, chain of custody, data
security procedures and assaying methods used by SolGold confirm
that they are consistent with industry best practices and all
results stated in this announcement have passed SolGold's QA/QC
protocol.
The data aggregation method for calculating Copper Equivalent
(CuEq) for down-hole drilling intercepts and rock-saw channel
sampling intervals are reported using copper equivalent (CuEq)
cut-off grades with up to 10m internal dilution, excluding bridging
to a single sample and with minimum intersection length of 50m.
Copper Equivalent is currently calculated (assuming 100%
recovery of copper and gold) using a Gold Conversion Factor of
0.751 (CuEq = Cu + Au x 0.751), calculated from a current nominal
copper price of US$3.30/lb and a gold price of US$1700/oz.
True widths of downhole intersections are not well constrained.
Drill hole one was inclined -55degrees towards the east, and the
interpreted trend of the Cacharposa Intrusive Complex and its
associated porphyry copper-gold mineralisation is subvertical,
dipping approximately 85-90 degrees to the west. The true width of
down-hole intersections reported are therefore expected to be
approximately 55-60% of the down-hole lengths.
See www.solgold.com.au for more information. Follow us on
twitter @SolGold plc
CAUTIONARY NOTICE
News releases, presentations and public commentary made by
SolGold plc (the "Company") and its Officers may contain certain
statements and expressions of belief, expectation or opinion which
are forward looking statements, and which relate, inter alia, to
interpretations of exploration results to date and the Company's
proposed strategy, plans and objectives or to the expectations or
intentions of the Company's Directors. Such forward-looking and
interpretative statements involve known and unknown risks,
uncertainties and other important factors beyond the control of the
Company that could cause the actual performance or achievements of
the Company to be materially different from such interpretations
and forward-looking statements.
Accordingly, the reader should not rely on any interpretations
or forward-looking statements; and save as required by the exchange
rules of the TSX and LSE or by applicable laws, the Company does
not accept any obligation to disseminate any updates or revisions
to such interpretations or forward-looking statements. The Company
may reinterpret results to date as the status of its assets and
projects changes with time expenditure, metals prices and other
affecting circumstances.
This release may contain "forward--looking information" within
the meaning of applicable Canadian securities legislation.
Forward--looking information includes, but is not limited to,
statements regarding the Company's plans for developing its
properties. Generally, forward--looking information can be
identified by the use of forward-looking terminology such as
"plans", "expects" or "does not expect", "is expected", "budget",
"scheduled", "estimates", "forecasts", "intends", "anticipates" or
"does not anticipate", or "believes", or variations of such words
and phrases or state that certain actions, events or results "may",
"could", "would", "might" or "will be taken", "occur" or "be
achieved".
Forward--looking information is subject to known and unknown
risks, uncertainties and other factors that may cause the actual
results, level of activity, performance or achievements of the
Company to be materially different from those expressed or implied
by such forward--looking information, including but not limited to:
transaction risks; general business, economic, competitive,
political and social uncertainties; future prices of mineral
prices; accidents, labour disputes and shortages and other risks of
the mining industry. Although the Company has attempted to identify
important factors that could cause actual results to differ
materially from those contained in forward-looking information,
there may be other factors that cause results not to be as
anticipated, estimated or intended. There can be no assurance that
such information will prove to be accurate, as actual results and
future events could differ materially from those anticipated in
such statements. Factors that could cause actual results to differ
materially from such forward-looking information include, but are
not limited to, risks relating
to the ability of exploration activities (including assay
results) to accurately predict mineralization; errors in
management's geological modelling; capital and operating costs
varying significantly from estimates; the preliminary nature of
visual assessments; delays in obtaining or failures to obtain
required governmental, environmental or other required approvals;
uncertainties relating to the availability and costs of financing
needed in the future; changes in equity markets; inflation; the
global economic climate; fluctuations in commodity prices; the
ability of the Company to complete further exploration activities,
including drilling; delays in the development of projects;
environmental risks; community and non-governmental actions; other
risks involved in the mineral exploration and development industry;
the ability of the Company to retain its key management employees
and skilled and experienced personnel; and those risks set out in
the Company's public documents filed on SEDAR at www.sedar.com .
Accordingly, readers should not place undue reliance on
forward--looking information. The Company does not undertake to
update any forward-looking information, except in accordance with
applicable securities laws.
The Company and its officers do not endorse, or reject or
otherwise comment on the conclusions, interpretations or views
expressed in press articles or third-party analysis, and where
possible aims to circulate all available material on its
website.
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END
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