16:00 Mon 06 Sep 2021
Ormonde Mining PLC - Reconvening of AGM
This announcement contains inside information
Ormonde Mining plc
("Ormonde" or "the Company")
Reconvening of AGM and Letter from the Executive Chair
The Company announces the reconvening of its adjourned Annual General Meeting ("AGM") on Thursday,
A Letter from the Executive Chair, Notice of AGM and Form of Proxy are being posted to shareholders today, along with a letter from Mr.
Shareholders are urged to read the note section of the Notice of AGM for important information pertaining to voting, attending the meeting and associated Covid-19 safety measures. Some high-level information in this regard is provided at the end of this the release.
The letter from the Executive Chair,
LETTER FROM THE CHAIR
Dear Shareholder,
I am writing to you to explain the resolutions to be proposed at the forthcoming Annual General Meeting of the Company ("AGM") which is to be reconvened on Thursday 30 September 2021 at 11 a.m. IST/BST at the
This letter contains some important background and explanatory notes in relation to the resolutions being proposed at the AGM and to the Board's recommendations thereon, which are set out in conclusion at the end of this letter. Please read this letter in its entirety to ensure that you, as a shareholder, are well informed on the issues at hand, together with the consequences of your voting, and are able to exercise that vote based on such material information.
As announced on
Having regard to the substance of the matters addressed in this letter, Mr.
This letter and the recommendations contained within have been agreed unanimously by the other board members, being myself and Mr.
I would like to advise all shareholders to carefully consider the two new director nominations, in addition to
· if these nominations are approved by shareholders at the AGM, then three of the six directors on the revised board of directors, and possibly three of five in the circumstances where Mr.
· while
· your Board therefore strongly believes such nominations to be indicative of an attempt to exert a level of influence whereby
·
· over the last year,
·
·
·
· given the difficulties encountered with obtaining
In the context of the above, and for the reasons set out below, the Board recommends that shareholders vote AGAINST Resolutions 7 and 8, being the resolutions proposed by
With regard to the resolutions relating to an increase to the authorised share capital of the Company, share allotment authority and disapplication of pre-emptive rights, the Board wishes to highlight the following points:
· following
· given the consequent uncertainty caused to counterparties to potential transactions the Board is now also seeking support for an increase in the Company's authorised share capital from 650 million to 950 million ordinary shares. If passed, this would enable the Company to issue a greater number of shares as consideration in a potential transaction, should the Board believe it to be in the interest of all shareholders. Importantly, this would remove the current uncertainty for potential counterparties in relation to the Board's ability to transact, and potentially increase the number of possible opportunities but would not empower the directors to allot shares for cash otherwise than on a pre-emptive basis and would be subject to the usual AIM and Euronext Growth Market Rule requirements, including in relation to reverse takeover shareholder approval and related party transactions; and
· should shareholders not support these resolutions at the upcoming AGM, the Board's ability to engage effectively with counterparties in regard to possible projects and complete any transaction will continue to be severely limited. The consequences of such an outcome may be far reaching, including the continued inability to negotiate and conclude an acquisition, cash resources depletion and ultimately endangering Ormonde's continued suitability for listing.
The Board recommends that shareholders vote IN FAVOUR of Resolutions 1 to 6
Company strategy
Your Board has been pursuing a clear strategy to acquire, explore and develop mining projects in which it has a controlling interest. The Company has spent considerable time and resources identifying and evaluating new opportunities for the deployment of the Company's capital and enhancement of shareholder value through the acquisition of a transformative project for the Company.
However, progress in this regard was slowed, and has ultimately stalled, in the opinion of the Board, following interactions with
Prior to the 2020 AGM your Board believed it had the support of
Proposed nomination of directors by Mr. Anderson
As announced on
Since that date, one of the proposed directors withdrew his nomination. A replacement for this nominee has now been tabled by
The Board has conducted limited due diligence on both nominees and is of the view that, notwithstanding the Board has no reason to believe that they would not be suitable for board appointments generally, absent the requisition by
Whilst
The Board, therefore, does not see the incremental value such nominees would bring to Ormonde's current strategy, and whilst Ormonde continues to search for opportunities in mining exploration and development the Board believes that its current composition and structure is appropriate, being four directors - one executive, Mr.
In an attempt to address this,
It was also made known to
Despite these proposals, which the Board considers to be reasonable, and numerous requests for clarification on his strategy and intentions, it appears that
Board interactions with Mr. Anderson
The Board seeks to manage the Company's affairs in line with the governance required of a company whose shares are traded on the AIM Market and the Euronext Growth Market and the level of shareholder consultation consistent with such governance. However,
In addition, Mr. Anderson has proposed investments to the Board for consideration, at a level without project or corporate control, and some involving minority participation in existing public company fundraisings.
Consequently, your Board has spent a vast amount of time in consideration of the situation and communication with
Ormonde has been severely restricted in its ability to continue to attract the interest of potential counterparties with suitable projects since the last AGM. Ultimately Ormonde remains unable to attract project vendors and is without the power to structure any deals or complete any significant transaction which the Board believes would be in the best interests of all shareholders unless it can obtain your favourable votes for Resolutions 1 to 6.
After due deliberation,
Given the situation, earlier this year the Board considered the option of winding up the Company with the goal of returning as much cash as possible to shareholders. However, the Board was informed that
AGM Resolutions
The Board believes it is in the best interests of shareholders as a whole to have a vote on the future of the Company and not to prolong this impasse and operational stasis any longer, not least as the cash available to the Company reduces daily.
Accordingly, following receipt of an amended requisition for nominee directors on behalf of
The Notice of AGM also includes typical resolutions on approval of accounts, non-executive director re-election (on rotation), and authorisations to fix the auditors remuneration and issue shares and dis-application of pre-emption rights, these being the standard authorities to allow the Board and Company to function normally and in the best interests of all shareholders, together with an increase of authorised share capital. These are covered by Resolutions 1 to 6. I would emphasise the importance of shareholders voting in favour of these resolutions, which the Board recommends regardless of the voting position to be taken with respect to new Board nominees, as the successful passing of these resolutions is essential to provide the Board with the flexibility required to have a realistic opportunity to deliver a material acquisition as a platform to enhance the long-term value of the Company.
Should Resolutions 2, 4, 5 and 6 not be approved, the Board's ability to engage seriously with counterparties in regard to possible projects and complete any transaction will continue to be severely limited. The consequences of such an outcome may be far reaching, including the continued inability to negotiate and conclude transactions due to the lack of confidence potential counterparties would have in the ability of the Board to obtain approval for any transaction, cash resources depletion and ultimately a danger to Ormonde's continued suitability for listing.
Resolutions 1 to 6 - Proposed by the Board
The Board recommends that you vote in favour of each of Resolutions 1 to 6:
Resolution 1 - Receipt and Consideration of the Accounts
This is an ordinary resolution to receive and consider the Company's financial statements for the financial year ended
Resolution 2 - Election of Director
Resolution 2 is an ordinary resolution to re-elect Mr.
Resolution 3 - Auditors' Remuneration
Resolution 3 is an ordinary resolution proposed each year to permit the directors to fix the Auditors' remuneration. The directors will have this authority no matter who is auditor.
Resolution 4 - Increase to Authorised Share Capital
Resolution 4 is an ordinary resolution to grant a general authority to the directors to increase the authorised share capital of the Company by the creation of 300 million Ordinary Shares of
Resolution 5 - Allotment of Relevant Securities
Resolution 5 is an ordinary resolution to grant a general authority to the directors to allot "relevant securities" of up to an amount equal to the authorised but yet unissued share capital of the Company. In practice, this is a public company resolution sought annually and this right provides the directors with the ability to use the Company's shares as part or full consideration for a transaction. As noted above and repeated here, the Board considers the passing of this resolution as being critical to provide it with the minimum flexibility required to have a realistic opportunity to deliver a material acquisition as a platform to enhance the long-term value of the Company.
The Board considers the passing of Resolutions 4 and 5 as being critical to provide it with the flexibility required to have a realistic opportunity to deliver a material acquisition as a platform to enhance the long-term value of the Company.
Resolution 6 - Allotment of Equity Securities
Resolution 6 is a special resolution to authorise the directors to allot "equity securities", essentially non-pro-rata issues for cash of ordinary shares of a nominal value equivalent of up to 10% of the nominal value of the issued share capital and issues of shares relating to the grant of any share options or share warrants or the exercise thereof. This resolution also provides the Board with an additional degree of flexibility as it works with management to implement a value enhancing transaction.
The authorities provided by Resolution 5 and 6, if passed, would expire 15 months after the passing of Resolutions 5 and 6 (respectively) or at the conclusion of the next AGM of the Company, whichever occurs first.
Resolutions 7 and 8 - Proposed by
The Board recommends that you vote against Resolutions 7 and 8.
Resolution 7 - Election of Director
Resolution 7 is an ordinary resolution proposed by Mr.
Resolution 8 - Election of Director
Resolution 8 is an ordinary resolution proposed by Mr.
Recommendation
There is no guarantee that
Taking into account all of the above, and based on the Board's interaction with
Shareholders are faced with an important choice, which can be summarised as follows:
Either: to support your Board to progress Ormonde's stated strategy of seeking a transformative transaction for the Company (which has been severely hampered in the last year) through the approval of resolutions providing the Board with additional flexibility to negotiate such transactions;
Or: to accept that the future of the Company is unknown and at risk of being put into the control and direction of a Board largely appointed by
Your Board believes that its current strategy is the right one, and new opportunities will be identified if project vendors believe that the Company can transact. This may only occur if the majority of shareholders vote down resolutions to introduce
There can be no assurance that, should a majority of shareholders vote with the Board's recommendations, your Board will be able to effect the strategy and succeed in reinstating a positive working relationship with
Furthermore, the Board believes that there can be no assurance that the Company's management, which has been integral to both maintenance of existing interests in the Spanish assets held by Ormonde and identification, assessment, negotiation and implementation of any transaction, and would be integral to an orderly winding up of the Company's interests, will remain with the Company without a clear actionable strategy for the business, or that the management team will be willing to remain involved to implement as yet unknown strategic proposals that may be proffered by
As stated above,
The other directors ("Directors") believe that the proposals set out before the meeting in Resolutions 1 to 6 are in the best interests of the Company and of shareholders as a whole and, accordingly, the Directors recommend that you vote in favour of each of these resolutions at the AGM.
The Directors believe that the proposals set out in Resolutions 7 and 8 are not in the best interests of the Company and of shareholders as a whole and, accordingly, the Directors recommend that you vote against each of these resolutions at the AGM.
Yours faithfully,
Executive Chair
Enquiries to:
Ormonde Mining plc
Tel: +353 (0)1 8014184
Media enquiries - Buchanan
Tel: +44 (0)20 7466 5000
Email: ormonde@buchanan.uk.com
Davy (Nomad, Euronext Growth Advisor and Joint Broker)
Tel: +353 (0)1 679 6363
SP Angel Corporate Finance LLP (Joint Broker)
Ewan Leggat
Tel: +44 (0)20 3 470 0470
Note on Letter from the Chair:
Instructions on how to participate (including by appointing a proxy) in the Annual General Meeting ("AGM") of Ormonde are set out in the notes to the Notice of AGM which has been posted to all certificated shareholders and which is available to view on the Company's website at: http://ormondemining.com/investors/investor-notices/.
The Company continues to monitor the impact of COVID-19 and any relevant updates regarding the AGM, including any changes to the arrangements outlined in this letter, will also be made available in the same location on the Company's website.
In the light of current and likely restrictions on public gatherings, you may be asked to prove full vaccination against or recovery from Covid-19 to gain attendance to the AGM and numbers of attendees may be restricted. In the light of the foregoing and of possible measures that may be introduced as referred to above, so as to ensure that your vote is counted, we encourage all shareholders to submit proxy instructions ahead of the meeting and before the voting deadlines, detailed in the notes to the Notice of AGM, to guarantee that you can vote and be represented at the AGM whether capable of attending or not.
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