2nd May 2008 07:00
Albidon Limited02 May 2008 ALBIDON LIMITED ARBN 107 288 755 __________________________________________________________________ NOTICE OF ANNUAL GENERAL MEETING EXPLANATORY MEMORANDUM ____________________________________________________________________ Date of Meeting 29 May 2008 Time of Meeting 11:00 am Place of Meeting Kings Park Function Room 1 Kings Park Function Centre Frasers Avenue, West Perth Western Australia ALBIDON LIMITED ARBN 107 288 755 NOTICE IS HEREBY GIVEN that the Annual General Meeting of the shareholders ofAlbidon Limited ("Company") will be held at Kings Park Function Room 1, KingsPark Function Centre, Frasers Avenue, West Perth, Western Australia on Thursday29th May 2008 at 11:00 am Western Australian Standard Time, for the purpose oftransacting the following business referred to in this Notice of Annual GeneralMeeting. An Explanatory Memorandum containing information in relation to the followingResolutions accompanies this Notice of Meeting. AGENDA ORDINARY BUSINESS 2007 Accounts To receive, consider and adopt the financial report of the Company for the yearended 31 December 2007, and the reports by the Directors and IndependentAuditors. Resolution 1 - Re-election of Mr Christopher De Guingand as a Director To consider and, if thought fit, to pass, with or without amendment thefollowing resolution as an ordinary resolution: "That Mr Christopher De Guingand, who retires by rotation in accordance witharticle 12.2 of the Company's Articles of Association and who offers himself forre-election, be elected a Director of the Company." Resolution 2 - Re-election of Mr John Thomas Shaw as a Director To consider and, if thought fit, to pass, with or without amendment, thefollowing resolution as an ordinary resolution: "That Mr John Thomas Shaw, who retires by rotation in accordance with article12.5 of the Company's Articles of Association and who offers himself forre-election, be elected a Director of the Company." Resolution 3 - Ratifying the Issue of 8,474,577 Shares That shareholders consider and, if thought fit, to pass, with or withoutamendment, the following resolution as an ordinary resolution: "That pursuant to Listing Rule 7.4 of the Listing Rules of ASX Limited, theCompany approves and ratifies the allotment and issue of 8,474,577 Shares in thecapital of the Company at a price of AUD$3.35 per Share to parties as specified,and on such terms and conditions referred to, in the Explanatory Memorandumaccompanying this Notice." Short Explanation: Under ASX Listing Rule 7.1, the Company may not issue oragree to issue equity securities in any 12 month period representing more than15% of its ordinary share capital on issue at the commencement of that periodwithout shareholder approval. Please refer to the Explanatory Statement fordetails. Voting Exclusion - The Company will disregard any votes cast on this Resolutionby any person who participated in the issue and any associates of those persons.However, the Company need not disregard a vote if it is cast by a person asproxy for a person who is entitled to vote, in accordance with the directions onthe proxy form or it is cast by the person chairing the meeting as proxy for aperson who is entitled to vote, in accordance with a direction on the proxy formto vote as the proxy decides. Resolution 4 - Ratifying the Issue of 400,000 Options That shareholders consider and, if thought fit, to pass, with or withoutamendment, the following resolution as an ordinary resolution: "That for the purposes of Listing Rule 7.4 of the Listing Rules of ASX Limitedand for all relevant purposes, the Company ratifies the allotment of 400,000Options to Barclays Capital, each exercisable at AUD$2.81 and expiring on orbefore 1 February 2011, and otherwise on the terms and conditions set out in theExplanatory Memorandum accompanying this Notice." Short Explanation: Under ASX Listing Rule 7.1, the Company may not issue oragree to issue equity securities in any 12 month period representing more than15% of its ordinary share capital on issue at the commencement of that periodwithout shareholder approval. Please refer to the Explanatory Statement fordetails. Voting Exclusion - The Company will disregard any votes cast on this Resolutionby Barclays Capital and any associates of Barclays Capital. However, theCompany need not disregard a vote if it is cast by a person as proxy for aperson who is entitled to vote, in accordance with the directions on the proxyform or it is cast by the person chairing the meeting as proxy for a person whois entitled to vote, in accordance with a direction on the proxy form to vote asthe proxy decides. Resolution 5 - Grant of Options to Managing Director To consider and if thought fit, to pass, with or without amendment, thefollowing resolution as an ordinary resolution: "That, for the purposes of Listing Rule 10.11 of the Listing Rules of ASXLimited and for all relevant purposes, approval is given for the Company togrant 500,000 Options to Mr Dale Clark Rogers (or his nominee) each exercisableat AUD$3.22 and expiring on or before 1 December 2011, and otherwise on theterms and conditions set out in the Explanatory Memorandum accompanying thisNotice." Short Explanation: The ASX Listing Rules require the Company to seek shareholderapproval prior to the issue of equity securities to a related party. Mr Rogersas a Director is a related party of the Company. Voting Exclusion - The Company will disregard any votes cast on this Resolutionby Mr Rogers and any person associated with Mr Rogers. However, the Company neednot disregard a vote if it is cast by a person as proxy for a person who isentitled to vote, in accordance with the directions on the proxy form or it iscast by the person chairing the meeting as proxy for a person who is entitled tovote, in accordance with a direction on the proxy form to vote as the proxydecides. Resolution 6 - Grant of Options to Director - Mr John Shaw To consider and if thought fit, to pass, with or without amendment, thefollowing resolution as an ordinary resolution: "That, for the purposes of Listing Rule 10.11 of the Listing Rules of ASXLimited and for all relevant purposes, approval is given for the Company togrant 300,000 Options to Mr John Shaw (or his nominee) each exercisable atAUD$3.47 and expiring on or before 30 June 2011, and otherwise on the terms andconditions set out in the Explanatory Memorandum accompanying this Notice." Short Explanation: The ASX Listing Rules require the Company to seek shareholderapproval prior to the issue of equity securities to a related party. Mr Shaw asa Director is a related party of the Company. Voting Exclusion - The Company will disregard any votes cast on this Resolutionby Mr Shaw and any person associated with them. However, the Company need notdisregard a vote if it is cast by a person as proxy for a person who is entitledto vote, in accordance with the directions on the proxy form or it is cast bythe 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 7 - Approving the Issue of Options to Key Personnel That shareholders consider and if thought fit, to pass, with or withoutamendment, the following resolution as an ordinary resolution: "That for the purposes of Listing Rule 7.4 of the Listing Rules of ASX Limitedand for all relevant purposes, the Directors are authorised to allot and issueup to 2,595,000 Options to key personnel on the terms and conditions set out inthe Explanatory Memorandum accompanying this Notice." Short Explanation: Under ASX Listing Rule 7.1, the Company may not issue oragree to issue equity securities in any 12 month period representing more than15% of its ordinary share capital on issue at the commencement of that periodwithout shareholder approval. Please refer to the Explanatory Statement fordetails. Voting Exclusion - The Company will disregard any votes cast on this Resolutionby any person who participated in the issue and any associates of those persons.However, the Company need not disregard a vote if it is cast by a person asproxy for a person who is entitled to vote, in accordance with the directions onthe proxy form or it is cast by the person chairing the meeting as proxy for aperson who is entitled to vote, in accordance with a direction on the proxy formto vote as the proxy decides. Resolution 8 - Variation to the terms of Options held by Ms Olivia Woodland To consider and if thought fit, to pass, with or without amendment, thefollowing resolution as an ordinary resolution: "That, for the purposes of Listing Rule 6.23.4 of the Listing Rules of ASXLimited, and for all other purposes, approval is given for the Company to varythe terms of 50,000 Options, each exercisable at AUD$1.05 on or before 30 June2009, issued on 29 September 2006 to Ms Olivia Woodland, in the manner as setout in the Explanatory Memorandum accompanying this Notice." Short Explanation: The ASX Listing Rules require the Company to seek shareholderapproval prior to the variation of terms applying to Options which have alreadybeen granted. Voting Exclusion - The Company will disregard any votes cast on this Resolutionby Ms Olivia Woodland and any person associated with Ms Olivia Woodland.However, the Company need not disregard a vote if it is cast by a person asproxy for a person who is entitled to vote, in accordance with the directions onthe proxy form or it is cast by the person chairing the meeting as proxy for aperson who is entitled to vote, in accordance with a direction on the proxy formto vote as the proxy decides. Other business To deal with any other business which may be brought forward in accordance withthe Company's Articles of Association and any relevant legislation. BY ORDER OF THE BOARD Nicholas Day Company Secretary and Chief Financial Officer Proxies Registered Shareholders of the Company only can vote at the meeting eitherpersonally or by proxy, attorney or representative. A Shareholder entitled toattend and vote at the above meeting may appoint not more than two proxies toattend and vote at this meeting. Where more than one proxy is appointed, eachproxy must be appointed to represent a specified proportion of the Shareholder'svoting rights. A proxy may but need not be a shareholder of the Company. Theinstrument appointing a proxy must be in writing, executed by the appointor orhis/her attorney duly authorised in writing or, if such appointer is acorporation, either under seal or under hand of an officer or his/her attorneyduly authorised. The instrument of proxy (and the power of attorney or otherauthority, if any, under which it is signed) must be lodged by person, post,courier or facsimile and reach the Registered Office of the Company not laterthan 11:00 am Western Australian Standard Time on 23 May 2008. For theconvenience of shareholders a Proxy Form is enclosed with notices sent toShareholders. A shareholder that is a corporation may elect to appoint a representative inaccordance with the Articles of Association in which case the Company willrequire written proof of the representative's appointment which must be lodgedwith, or presented to the Company not later than 11:00am Western AustralianStandard Time on 23 May 2008. CHESS Depositary Interests Holders of CHESS Depositary Interests ("CDI") are invited to attend the meetingbut are not entitled to vote at the meeting. In order to have votes cast at theMeeting on their behalf, CDI holders must complete, sign and return the CDINotice of Direction enclosed with the Notice sent to them to ComputershareInvestor Services Pty Limited, Level 2, 45 St Georges Terrace, Perth, WA 6000,Australia or GPO Box D182, Perth WA 6840, Australia so that CDI holders candirect CHESS Depositary Nominees Pty Ltd ("CDN") to vote the underlying shareson their behalf. The CDI Notice of Direction needs to be received at the addressshown on the form by not later than 11:00am Western Australian Standard Time on23 May 2008. CREST - Depositary Interests Holders of Depositary Interests in CREST ("DI") are invited to attend themeeting but are not entitled to vote at the meeting. In order to have votes castat the Meeting on their behalf, DI holders must complete, sign and return theinstruction form enclosed with the Notice sent to them to Computershare InvestorServices PLC, PO BOX 82, The Pavilions, Bridgewater Road, Bristol BS99 7NH sothat DI holders can direct Computershare Company Nominees Limited ("CCN") tovote the underlying shares on their behalf. The instruction form needs to bereceived at the address shown on the form by not later than 11:00am WesternAustralian Standard Time (being 4:00 am London Time) on 23 May 2008. ALBIDON LIMITED ARBN 107 288 755 EXPLANATORY MEMORANDUM This Explanatory Memorandum has been prepared for the Shareholders of AlbidonLimited ("Albidon" or "Company") in connection with the business to be conductedat the Annual General Meeting of the Company to be held at King Kings ParkFunction Room 1, Kings Park Function Centre, Frasers Avenue, West Perth, WesternAustralia on Thursday 29th May 2008 at 11:00 am Western Australian StandardTime. This Explanatory Memorandum should be read in conjunction with the accompanyingNotice of Annual General Meeting. The Directors recommend that Shareholders read this Explanatory Memorandumbefore determining whether or not to support the Resolutions. THE RESOLUTIONS RESOLUTION 1 - RE-ELECTION OF MR CHRISTOPHER DE GUINGAND AS A DIRECTOR This Resolution seeks approval for the re-election of Mr Christopher De Guingandas a Director with effect from the end of the meeting. Article 12.2 of the Company's Articles of Association provides that at eachAnnual General Meeting one-third of the Directors (or if their number is not amultiple of three, then such number as is appropriate to ensure that no Directorother than alternate Directors and the Managing Director holds office for morethan three years) shall retire from office. Mr De Guingand retires from office in accordance with this requirement andsubmits himself for re-election. Mr De Guingand has served as a non-executiveDirector of the Company and will continue to do so up to the date of theMeeting. On his re-election to the Board under Resolution 1, he will continue asa non-executive Director. Directors' Recommendation Mr De Guingand declined to make a recommendation about the proposed resolutionbecause he has an interest in its outcome. Dale Rogers, Dick Potts, AlasdairCooke, Valentine Chitalu, Paul Chapman and John Shaw recommend that Mr DeGuingand be re-elected to the Board. RESOLUTION 2 - RE-ELECTION OF MR JOHN THOMAS SHAW AS A DIRECTOR This Resolution seeks approval for the re-election of Mr John Thomas Shaw as aDirector with effect from the end of the meeting. Mr. Shaw is a geological engineer and until his retirement was Vice President ofAustralian Operations of Placer Dome Asia Pacific and Managing Director forKidston Gold Mines Limited. He brings to Albidon technical and strategicexpertise gained from 40 years developing and operating projects in the miningindustry internationally. Mr Shaw was appointed a director of the Company on 7 March 2008 and retires fromoffice and submits himself for re-election in accordance with Article 12.5 ofthe Company's Articles of Association which requires newly appointed directorsto seek re-election at the next AGM following their appointment. Mr Shaw hasserved as a non-executive Director of the Company and will continue to do so upto the date of the Meeting. With effect from his re-election to the Board underthis Resolution, he will continue as a non-executive Director. Directors' Recommendation Mr Shaw declined to make a recommendation about the proposed resolution becausehe has an interest in its outcome. Dale Rogers, Dick Potts, Alasdair Cooke,Valentine Chitalu, Paul Chapman and Chris De Guingand recommend that Mr Shaw bere-elected to the Board. RESOLUTION 3 - RATIFYING THE ISSUE OF 8,474,577 SHARES The Company previously announced on 17 December 2007 the placement of 8,474,577Shares at an issue price of AUD$3.35 to Jinchuan Group Limited ("Jinchuan") andZCCM Investments Holdings Plc ("ZCCM-IH") to raise US$25 million. The above funding from Jinchuan and ZCCM-IH fulfils a significant portion of theremaining funding required for development of the Munali Nickel Project inZambia ensuring Albidon retained sufficient funds for exploration, increaseddrilling activities and business development activities. Approvals Required Under Chapter 7 of the ASX Listing Rules, there are limitations on the capacityof the Company to enlarge its capital by the issue of equity securities. ASX Listing Rule 7.1 provides generally that a company may not issue shares oroptions to subscribe for shares equal to more than 15% of the company's issuedshare capital in any 12 months without obtaining shareholder approval. Listing Rule 7.4 enables shareholders to ratify previous issues by the Companyin order to refresh the Company's ability to issue 15% of its issued capitalunder Listing Rule 7.1. This will leave the Company with the flexibility toissue equity securities in the future up to the 15% threshold. Under this resolution, the Company seeks from Shareholders approval for, andratification of, the issues of securities set out below so as to limit therestrictive effect of ASX Listing Rule 7.1 on any further issues of securitiesin the next 12 months. For the purposes of ASX Listing Rule 7.5, the following information is providedto Shareholders: (a) The number of Shares allotted was 8,474,577 Shares. (b) The Shares were issued at AUD$3.35 per Share. (c) The Shares issued were fully paid ordinary shares in the Company andrank equally with the Company's existing issued Shares. (d) The allottees of the Shares were: Shares issued Date of IssueJinchuan Group Limited 5,084,746 28/2/08ZCCM Investments Holdings Plc 3,389,831 31/1/08 (e) The funds raised will be used to assist in the purchase ofequipment, construction of the Munali Nickel Project and development of themine. Directors' Recommendation The Board recommends Shareholders vote in favour of this resolution as it allowsthe Company to ratify the above issue of Shares and retain the flexibility toissue further equity securities representing up to 15% of the Company's sharecapital during the next 12 months. RESOLUTION 4 - RATIFY THE ISSUE OF 400,000 OPTIONS On 21 December the Company announced the issue of 400,000 unlisted options toBarclays Capital ("Barclays") in satisfaction of customary banking feesassociated with the securing of a further US$20 million in debt financing fromBarclays. This additional debt is under the same terms as the initial fundingprovided by Barclays. The exercise price of the Options was set at a 5% premium to the 20 day VolumeWeighted Average Share Price prior to the 7th of December, being AUD$2.81. TheOptions are exercisable on or before 1 February 2011 and otherwise on the termsand conditions as set out in Appendix A. The issue of these Options preservesthe cash resources of the Company and demonstrates Barclays' long term supportfor the Munali Nickel Project. Approvals Required Under this resolution, the Company seeks from Shareholders approval for, andratification of, the issues of securities set out below so as to limit therestrictive effect of ASX Listing Rule 7.1 on any further issues of securitiesin the next 12 months. For the purposes of Listing Rule 7.5, the following information is provided toshareholders: a) The total number of Options granted was 400,000; b) The Options were granted in full satisfaction of bankingfees associated with the securing of a further US$20 million in debt financingfrom Barclays; c) The terms and conditions of the Options granted are set outin Appendix A to this Explanatory Memorandum; d) The allottee was Barclays Capital; and e) No funds were raised by the grant of the Options. Directors' Recommendation The Board recommends Shareholders vote in favour of this resolution as it allowsthe Company to retain the flexibility to issue further equity securitiesrepresenting up to 15% of the Company's share capital during the next 12 months. RESOLUTIONS 5 & 6 - GRANT OF OPTIONS TO DIRECTORS As announced to the market on 3 December 2007 and 17 March 2008 subject toobtaining Shareholder approval, the Board has resolved to grant Options to twoDirectors as follows: Name Options Exercise AUD$ ExpiryDale Rogers 500,000 3.22 01/12/2011John Shaw 300,000 3.47 30/06/2011 The full terms of the Options to be granted to Messrs Rogers and Shaw are setout in Appendix B & C respectively to this Explanatory Memorandum. TheseResolutions seek Shareholder approval for the grant of these Options. The ASX Listing Rules set out a number of regulatory requirements which must besatisfied in relation to these Resolutions. These are summarised below. ASX Listing Rule 10.11 Listing Rule 10.11 requires a listed company to obtain shareholder approval byordinary resolution prior to the issue of securities (including the grant ofoptions) to a related party of the Company. If this Resolution is passed theOptions will be granted to Messrs Rogers and Shaw, who are related parties ofthe Company by virtue of them being Directors. Accordingly, approval for thegrant of the Options to Messrs Rogers and Shaw is required pursuant to ListingRule 10.11. Approval pursuant to Listing Rule 7.1 is not required in order togrant the Options to Messrs Rogers and Shaw as approval is being obtained underListing Rule 10.11. Shareholders should note that the grant of the Options toMessrs Rogers and Shaw with approval under Listing Rule 10.11 will not beincluded in the 15% calculation for the purposes of Listing Rule 7.1. Listing Rule 10.13 sets out a number of matters which must be included in anotice of meeting proposing an approval under Listing Rule 10.11. For thepurposes of Listing Rule 10.13, the following information is provided toshareholders: a) the number of Options to be granted by the Company is: Name Options Exercise AUD$ ExpiryDale Rogers (or his nominee) 500,000 3.22 01/12/2011John Shaw (or his nominee) 300,000 3.47 30/6/2011 b) the Options will be granted for nil consideration and therefore no fundswill be raised from the grant of the Options. The full terms and conditions ofthe Options are set out in Appendix B & C of this Explanatory Memorandum; c) the Options will be granted within one month of the date of the meetingor at such later time approved by ASX by way of waiver to the ASX Listing Rules;and d) the purpose of the grant of the Options is to continue to give MessrsRogers and Shaw an incentive to provide dedicated and ongoing commitment to theCompany and to preserve the Company's cash funds. Recommendation All Directors (excluding Mr Rogers (in relation to Resolution 5) and Mr Shaw (inrelation to Resolution 6)) recommend that shareholders vote in favour of theResolutions as they are of the view that the grant of the Options to MessrsRogers and Shaw preserves the cash resources of the Company during itsforthcoming project development phase, and at the same time provides an addedincentive to create shareholder wealth. Mr Rogers (in relation to Resolution 5)and Mr Shaw (in relation to Resolution 6)declined to make a recommendation inrelation to the Resolutions due to the fact that they have a material personalinterest in their outcome. If Shareholders approve the grant of Options to Messrs Rogers and Shaw, and allof the Options are exercised, the effect will be to dilute the shareholding ofexisting shareholders by approximately 0.48% on an undiluted basis and based onthe number of Shares on issue as at the date of this Notice. The market pricefor Shares during the term of the Options would normally determine whether ornot Messrs Shaw and Rogers exercise the Options. If, at the time any of theOptions are exercised, the Shares are trading on ASX or AIM at a price that ishigher than the exercise price of the Options, there may be a perceived cost tothe Company. In the 6 months before the date of this Notice, the highest, lowestand last trading price of Shares on ASX are as set out below: Date Price AUD$Highest 11 March 2008 3.95Lowest 16 August 2007 1.82Last 16 April 2008 4.07 (a) The value of the Options has been calculated internally by the Companyusing the Binomial pricing model and is set out below; and (b) The existing direct holdings of Messrs Rogers and Shaw in the Company areas follows: Ordinary Shares Options over Shares Unlisted Expiry Exercise price (AUD$) Dale Rogers 350,000 1,200,000 01/12/2008 0.75 1,200,000 27/02/2010 2.10John Shaw - - - - (c) Under IFRS, the Company is required to expense the value of the Optionsin its statement of financial performance for the current financial year. Otherthan as set out in this Notice and Explanatory Memorandum the Company considersthat from an economic and commercial point of view there are not any costs ordetriments, including opportunity costs or taxation consequences, for theCompany or benefits foregone by the Company resulting from the grant of theOptions pursuant to these Resolutions. Valuation of Options The Options have been valued using the Binomial pricing model and based upon thefollowing assumptions: Name Dale Rogers John ShawOptions 500,000 300,000Exercise AUD$ 3.22 3.47Expiry 01/12/2011 30/6/2011Share Price at announcement AUD$2.65 AUD$3.43Common volatility factor 60% 60%Risk free interest rate (3yd Govt Bond) 6.07% 6.07%Valuation date 25 March 2005 25 March 2005Share Price at valuation AUD $3.43 AUD $3.43Valuation per Options AUD $1.70 AUD $1.51Total Value of Options AUD $850,000 AUD $453,000 The valuation ascribed to the Options may not necessarily represent the marketprice of the Options at the date of the valuation. RESOLUTION 7 - ISSUE OF OPTIONS TO KEY PERSONNEL During the year the Company issued the following incentive Options to keypersonnel in accordance with services agreements: Role Options Exercise AUD$ Expiry Issue DateGeneral Manager Business 100,000 3.25 01/02/2011 25/02/2008Development rCEO of Albidon Zambia Ltd 60,000 3.22 01/11/2009 03/12/2007CEO of Albidon Zambia Ltd 150,000 3.22 01/12/2011 03/12/2007 long term incentive optionsGeneral Manager Human Resources r 130,000 3.22 01/11/2009 03/12/2007General Manager Human Resources 100,000 3.22 01/12/2011 03/12/2007General Manager Exploration 30,000 3.22 01/11/2009 03/12/2007General Manager Exploration 75,000 3.22 01/12/2011 03/12/2007Chief Financial Officer 25,000 3.22 01/11/2009 03/12/2007Chief Financial Officer 75,000 3.22 01/12/2011 03/12/2007Corporate Affairs Manager 50,000 3.22 01/11/2009 03/12/2007HR and HSEQ Manager 50,000 2.97 30/12/2010 03/12/2007Technical and Resource 50,000 2.97 30/12/2010 03/12/2007CEO of Albidon Zambia Ltd 600,000 2.23 01/09/2010 22/08/2007Commercial Manager 100,000 2.88 30/12/2010 03/12/2007Plant Manager 100,000 2.88 30/12/2010 03/12/2007Engineering Manager 50,000 2.88 30/12/2010 03/12/2007Mining Consultant 50,000 2.88 30/12/2010 03/12/2007Mining Manager 50,000 2.88 30/12/2010 03/12/2007General Manager Human Resources 200,000 2.8 12/07/2010 27/07/2007General Manager Exploration 300,000 2.97 12/07/2010 27/07/2007Senior Management Accountant 50,000 3.14 12/07/2010 16/07/2007General Manager Business 200,000 3.14 12/07/2010 16/07/2007Development All Options are subject to vesting conditions that include a minimum period ofservice. The grant of these Options preserves the cash resources of the Companyand at the same time provides an added incentive for key personnel. The Companyis pleased at the commitment to the future of Albidon represented by representedby these agreements. Approvals Required Under this Resolution, the Company seeks from Shareholders ratification of theissues of securities set out below so as to limit the restrictive effect of ASXListing Rule 7.1 on any further issues of securities in the next 12 months. For the purposes of Listing Rule 7.5, the following information is provided toshareholders: a) The total number of Options granted was 2,595,000; b) The Options were granted as part remuneration pursuant to servicesagreements at the date of issue; c) The terms and conditions of the Options granted are set out in AppendixD to this Explanatory Memorandum; and d) The allottees are set out above. No funds were raised by the grant ofthe Options. Directors' Recommendation The ratification of the issue of these Options is keeping with the principles ofthe Company's remuneration policy and further preserves the cash resources ofthe Company during its forthcoming project development phase, and at the sametime provides an added incentive for key personnel to provide dedicated andongoing commitment to the Company. The Board recommends Shareholders vote infavour of this resolution as it allows the Company to retain the flexibility toissue further equity securities representing up to 15% of the Company's sharecapital during the next 12 months. RESOLUTION 8 - VARIATION TO TERMS OF EXISTING OPTIONS At a general meeting on 6th September 2006 the Company resolved to grant 150,000Options to Ms Olivia Woodland. Of these Options, two thirds have vested. Thefinal tranche of 50,000 Options vest on or before 1 January 2009. The 50,000Options are exercisable upon vesting at AUD$1.05 each on or before 30 June 2009. Resolution 8 proposes that the vesting condition for the final tranche of 50,000Options held by Ms Woodland vest immediately. ASX Listing Rule 6.23.4 - Resolutions 8 ASX Listing Rule 6.23.4 allows variation to option terms which are not otherwiseprohibited by ASX Listing Rule 6.23.3, provided shareholder approval isobtained. ASX has confirmed that the proposed variations are acceptable to ASXsubject to the Company receiving shareholder approval. Ms Woodland previously assisted the Company with negotiating various ZambiaAgreements which have assisted the Company in moving towards production ahead ofschedule. The Board recommends Shareholders vote in favour of this resolutionin recognition of the services previously provided by Ms Woodland. GLOSSARY OF TERMS In this Explanatory Memorandum the following expressions have the followingmeanings: "Albidon" or "Company" means Albidon Limited. "Board" means the board of Directors. "Directors" means the directors of Albidon from time to time. "Explanatory Memorandum" means this Explanatory Memorandum. "Meeting" means the general meeting of shareholders of Albidon convened by thisNotice. "Notice" or "Notice of Meeting" means the notice of annual general meeting thataccompanies this Explanatory Memorandum. "Option" means an option to acquire a Share. "Resolution" means a resolution referred to in the Notice of Meeting. "Share" means a fully paid ordinary share in the capital of Albidon. "Shareholder" means the holder of a Share. "WST" means Western Australian Standard Time. Appendix A - Terms of Barclays Capital Options The terms and conditions of the options are as follows: (i) Each option entitles the holder to subscribe for oneordinary share ("Share") in Albidon Limited (the "Company"). (ii) Application will not be made for Official Quotation or AIMAdmission of the options. (iii) The options are issued in accordance with the vesting termsin (v) below and are exercisable on or before 5pm (Australian WST) on 1 February2011 ("Expiry Date") by completing the attached option exercise form anddelivering it to Albidon's registered office with the exercise monies, either incash, banker's draft, cheque or CHAPS or telegraphic transfer. (iv) The option exercise price is AUD$ 2.81. (v) Subject to paragraph (xvi), the options are only exercisableand vest upon and subject to the following milestones being achieved: a) 33% to vest on 1 year from the date of issue of this certificate; b) 33% to vest on 2 years from the date of issue of this certificate; and c) remainder to vest on 3 years from the date of issue of thiscertificate. (vi) The options are not transferable, without prior approval ofthe Board. (vii) The Company undertakes that within two business days ofreceipt of the exercise form and monies referred to in (iii) above, it willallot and issue to the Optionholder the relevant number of Shares. The Companyand the Company's Share Registry will deliver to the Option holder a certificaterelating to those Shares and a replacement certificate relating to the remainingunvested and unexercised options as soon as is practicable. All Shares issuedupon exercise of the options will rank equally in all respects with Albidon thenissued Shares and will be credited as fully paid. Albidon will apply forquotation of the Shares on a Stock Exchange on which Shares are then listed andas directed by the Option holder, within 3 business days of all Shares of theexercise of the relevant options. (viii) There are no participating rights or entitlements inherent inthe options and holders will not be entitled to participate in new issues ofcapital offered to shareholders during the currency of the options. However,Albidon will ensure that for the purposes of determining entitlements to anysuch issue, option holders will be given reasonable the opportunity to exercisetheir options prior to the date for determining entitlements to participate inany such issue. (ix) There will be no change to the exercise price of the optionsor the number of Shares over which the options are exercisable in the event ofAlbidon making a pro-rata issue of Shares or other securities to the holders ofShares in Albidon (other than a Bonus Issue as defined in paragraph (x) below). (x) If there is a bonus issue ("Bonus Issue") to the holders ofShares in Albidon, the number of Shares over which the options are exercisablewill be increased by the number of Shares which the holder would have receivedif the options had been exercised before the record date for the Bonus Issue ("Bonus Shares"). The Bonus Shares must be paid up by Albidon out of profits orreserves (as the case may be) in the same manner as was applied in the BonusIssue and upon issue rank equally in all respects with the other shares of theclass on issue as at the date of issue of the Bonus Shares. (xi) In the event of a reconstruction (including consolidation,subdivision, return, reduction or pro rata cancellation) of the issued capitalof Albidon prior to the Expiry Date, the number of options to which each holderis entitled or the exercise price of the options or both shall be reconstructed(as appropriate) in accordance with the requirements of the ASX Listing Ruleswhich apply at that time. (xii) The Company will at least 20 Business Days before the ExpiryDate of the options send notices to the option holders stating the name of theoption holder, the number of options held and the number of Shares to be issuedon exercise of the options, the exercise price, the due date for payment and theconsequences of non-payment. (xiii) The Company agrees to keep available for issue free frompre-emptive rights such number of Shares from its authorised but unissued sharecapital as is required to enable the options to be exercised in full andcovenants that no additional approvals or consents are required in relation tothe issue of options or Shares. (xiv) If the an option certificate is lost, stolen, defaced ordestroyed, the Company will replace such certificate free of charge subject tosuch terms as to evidence, indemnity or otherwise as the Company will reasonablyrequire. (xv) The Company will keep a register showing the number of optionsit has issued to option holders together with the names and addresses of optionholders. The Company will recognise the Option holder as the absolute owner ofthe number of options set out in the Option holder's option certificate. (xvi) All options will vest and may be exercised: (i) within two months after a Change of Control Event has occurred; or (ii) following the triggering of a Mandatory Offer or receipt of a VoluntaryOffer; or (iii) following the making of an order or the passing of a resolution for thewinding-up or dissolution of the Company and upon exercise, the Option holderwill be treated as if it had, immediately before the date of the making of theorder or passing of the resolution, exercised the options and will be entitledto receive any sums as it would have received had it been the holder of, andpaid for, the Shares to which it would have become entitled by virtue of suchexercise. For the purposes of this clause: "Change of Control Event" means a shareholder, or a group of associatedshareholders, becoming entitled to sufficient shares in the Company to give itor them the ability, and that ability is successfully exercised, in generalmeeting, to replace all or a majority of the Board. "Mandatory Offer" as defined by the Article 11.7(c)(i) of the Company's Articlesof Association. "Voluntary Offer" as defined by the Article 11.7(c)(ii) of the Company'sArticles of Association. Appendix B - Terms of Managing Director Options The terms and conditions of the options are as follows: (i) Each Option entitles the Option Holder to subscribe forone Share in Albidon Limited. (ii) Application will not be made for Official Quotation or AIMAdmission of the Options. (iii) The Options are issued in accordance with the vesting termsin (v) below and are exercisable on or before 5pm (Australian WST) on 1 December2011 ("Expiry Date") by completing an Option exercise form and delivering it toAlbidon's registered office with the exercise monies. (iv) The Option exercise price is AUD$3.22 per Share. (v) Subject to paragraph (xvi), the Options are only exercisableand vest upon and subject to the following milestones being achieved: a) 250,000 to vest on continued employment from the date ofissue of this certificate up to 1 October 2010; and b) 250,000 to vest on continued employment from the date ofissue of this certificate upto 1 October 2011. (vi) The Options are not transferable, without prior approval ofthe Board. (vii) All Options issued will vest and may be exercised where theOption Holder ceases employment with the Company in the following circumstances: a) death or total permanent disability; b) retirement; c) redundancy; and d) any other reason based on which the Directors believe isfair and reasonable to warrant the Option Holder or its Associate maintaininghis/her right to exercise the Options. (viii) Should an Option Holder, in the opinion of the Directors,satisfy the requirements of paragraph (vii) the Options Holder or its Associate,as the case may be, will have a period of (1) year to exercise the Options fromthe date the Company receives notice of the specified event and acknowledges inwriting that such event satisfies the requirements of paragraph (vii). (ix) If the Option Holder ceases to be either an employee orconsultant of the Company for any reason then any unexercised Options willautomatically lapse, subject to paragraphs (vii) and (viii), on the date that is21 days after that occurring. Any unvested Options lapse immediately followingtermination of employment of the Option Holder. (x) All Shares issued upon exercise of the Options will rankequally in all respects with Albidon then issued Shares. If applicable, Albidonwill apply for quotation of the Shares on a Stock Exchange within 3 businessdays of all Shares issued upon exercise of the Options. (xi) There are no participating rights or entitlements inherent inthe Options and holders will not be entitled to participate in new issues ofcapital offered to shareholders during the currency of the Options. However,Albidon will ensure that for the purposes of determining entitlements to anysuch issue, Option Holders will be given reasonable the opportunity to exercisetheir Options prior to the date for determining entitlements to participate inany such issue. (xii) There will be no change to the exercise price of the Optionsor the number of Shares over which the Options are exercisable in the event ofAlbidon making a pro-rata issue of Shares or other securities to the holders ofShares in Albidon (other than a Bonus Issue as defined in paragraph (xiii)below). (xiii) If there is a bonus issue ("Bonus Issue") to the holders ofShares in Albidon, the number of Shares over which the Options are exercisablewill be increased by the number of Shares which the holder would have receivedif the Options had been exercised before the record date for the Bonus Issue ("Bonus Shares"). The Bonus Shares must be paid up by Albidon out of profits orreserves (as the case may be) in the same manner as was applied in the BonusIssue and upon issue rank equally in all respects with the other shares of theclass on issue as at the date of issue of the Bonus Shares. (xiv) In the event of a reconstruction (including consolidation,subdivision, return, reduction or pro rata cancellation) of the issued capitalof Albidon prior to the Expiry Date, the number of Options to which each holderis entitled or the exercise price of the Options or both shall be reconstructed(as appropriate) in accordance with the requirements of the ASX Listing Ruleswhich apply at that time. (xv) The Company will at least 20 Business Days before the ExpiryDate of the Options send notices to the Option Holders stating the name of theOption Holder, the number of Options held and the number of Shares to be issuedon exercise of the Options, the exercise price, the due date for payment and theconsequences of non-payment. (xvi) All Options will vest and may be exercised: (i) within two months after a Change of Control Event has occurred; or (ii) following the triggering of a Mandatory Offer or receipt of a VoluntaryOffer. For the purposes of this clause: "Change of Control Event" means a shareholder, or a group of associatedshareholders, becoming entitled to sufficient shares in the Company to give itor them the ability, and that ability is successfully exercised, in generalmeeting, to replace all or a majority of the Board. "Mandatory Offer" as defined by the Article 11.7(c)(i) of the Company's Articlesof Association. "Voluntary Offer" as defined by the Article 11.7(c)(ii) of the Company'sArticles of Association. Appendix C - Terms of John Shaw Options (i) Each Option entitles the Option Holder to subscribe forone Share in Albidon Limited. (ii) Application will not be made for Official Quotation or AIMAdmission of the Options. (iii) The Options are issued in accordance with the vesting termsin (v) below and are exercisable on or before 5pm (Australian WST) on 30 June2011 ("Expiry Date") by completing an Option exercise form and delivering it toAlbidon's registered office with the exercise monies. (iv) The Option exercise price is AUD$ 3.47 per Share. (v) Subject to paragraph (xvi), the Options are only exercisableand vest upon and subject to the following milestones being achieved: a) 100,000 to vest on 1 year of continued employment from thedate of issue of this certificate; b) 100,000 to vest on 2 years of continued employment from thedate of issue of this certificate; and c) 100,000 to vest on 3 years of continued employment from thedate of issue of this certificate. (vi) The Options are not transferable, without prior approval ofthe Board. (vii) All Options issued will vest and may be exercised where theOption Holder ceases employment with the Company in the following circumstances: a) death or total permanent disability; b) retirement; c) redundancy; and d) any other reason based on which the Directors believe isfair and reasonable to warrant the Option Holder or its Associate maintaininghis/her right to exercise the Options. (viii) Should an Option Holder, in the opinion of the Directors,satisfy the requirements of paragraph (vii) the Options Holder or its Associate,as the case may be, will have a period of (1) year to exercise the Options fromthe date the Company receives notice of the specified event and acknowledges inwriting that such event satisfies the requirements of paragraph (vii). (ix) If the Option Holder ceases to be either an employee orconsultant of the Company for any reason then any unexercised Options willautomatically lapse, subject to paragraphs (vii) and (viii), on the date that is21 days after that occurring. Any unvested Options lapse immediately followingtermination of employment of the Option Holder. (x) All Shares issued upon exercise of the Options will rankequally in all respects with Albidon then issued Shares. If applicable, Albidonwill apply for quotation of the Shares on a Stock Exchange within 3 businessdays of all Shares issued upon exercise of the Options. (xi) There are no participating rights or entitlements inherent inthe Options and holders will not be entitled to participate in new issues ofcapital offered to shareholders during the currency of the Options. However,Albidon will ensure that for the purposes of determining entitlements to anysuch issue, Option Holders will be given reasonable the opportunity to exercisetheir Options prior to the date for determining entitlements to participate inany such issue. (xii) There will be no change to the exercise price of the Optionsor the number of Shares over which the Options are exercisable in the event ofAlbidon making a pro-rata issue of Shares or other securities to the holders ofShares in Albidon (other than a Bonus Issue as defined in paragraph (xiii)below). (xiii) If there is a bonus issue ("Bonus Issue") to the holders ofShares in Albidon, the number of Shares over which the Options are exercisablewill be increased by the number of Shares which the holder would have receivedif the Options had been exercised before the record date for the Bonus Issue ("Bonus Shares"). The Bonus Shares must be paid up by Albidon out of profits orreserves (as the case may be) in the same manner as was applied in the BonusIssue and upon issue rank equally in all respects with the other shares of theclass on issue as at the date of issue of the Bonus Shares. (xiv) In the event of a reconstruction (including consolidation,subdivision, return, reduction or pro rata cancellation) of the issued capitalof Albidon prior to the Expiry Date, the number of Options to which each holderis entitled or the exercise price of the Options or both shall be reconstructed(as appropriate) in accordance with the requirements of the ASX Listing Ruleswhich apply at that time. (xv) The Company will at least 20 Business Days before the ExpiryDate of the Options send notices to the Option Holders stating the name of theOption Holder, the number of Options held and the number of Shares to be issuedon exercise of the Options, the exercise price, the due date for payment and theconsequences of non-payment. (xvi) All Options will vest and may be exercised: (i) within two months after a Change of Control Event has occurred; or (ii) following the triggering of a Mandatory Offer or receipt of a VoluntaryOffer. For the purposes of this clause: "Change of Control Event" means a shareholder, or a group of associatedshareholders, becoming entitled to sufficient shares in the Company to give itor them the ability, and that ability is successfully exercised, in generalmeeting, to replace all or a majority of the Board. "Mandatory Offer" as defined by the Article 11.7(c)(i) of the Company's Articlesof Association. "Voluntary Offer" as defined by the Article 11.7(c)(ii) of the Company'sArticles of Association. Appendix D - Terms of Management Options The material terms and conditions of the options are as follows: (i) Each option entitles the holder to subscribe for one Sharein Albidon Limited. (ii) Application will not be made for Official Quotation or AIMAdmission of the options. (iii) The options are issued in accordance with the vesting termsin (v) below and are exercisable on or before 5pm (Australian WST) is as definedin the table of options summarised in the explanatory memorandum underResolution 7 ("Expiry Date") by completing an option exercise form anddelivering it to Albidon's registered office with the exercise monies. (iv) The option exercise price is as defined in the table ofoptions summarised in the explanatory memorandum under Resolution 7 per Share. (v) Subject to paragraph (xvi), the Options are subject tovesting conditions that include a minimum period of service which may be waivedby the Board. (vi) The options are not transferable, without prior approval ofthe Board. (vii) All Options issued will vest and may be exercised where theOption Holder ceases employment with the Company in the following circumstances: a. death or total permanent disability; b. retirement; c. redundancy; and d. any other reason based on which the Directors believe is fair andreasonable to warrant the Option Holder or its Associate maintaining his/herright to exercise the Options. (viii) Should an Option Holder, in the opinion of the Directors,satisfy the requirements of paragraph (vii) the Options Holder or its Associate,as the case may be, will have a period of (1) year to exercise the Options fromthe date the Company receives notice of the specified event and acknowledges inwriting that such event satisfies the requirements of paragraph (vii). (ix) If the option holder ceases to be either an employee orconsultant of the Company for any reason then any unexercised options willautomatically lapse, subject to paragraphs (vii) and (viii) on the date that is21 days after that occurring. Any unvested options lapse immediately followingtermination of employment of the option holder. (x) All Shares issued upon exercise of the options will rankequally in all respects with Albidon then issued Shares. If applicable, Albidonwill apply for quotation of the Shares on a Stock Exchange within 3 businessdays of all Shares issued upon exercise of the options. (xi) There are no participating rights or entitlements inherent inthe options and holders will not be entitled to participate in new issues ofcapital offered to shareholders during the currency of the options. However,Albidon will ensure that for the purposes of determining entitlements to anysuch issue, option holders will be given reasonable the opportunity to exercisetheir options prior to the date for determining entitlements to participate inany such issue. (xii) There will be no change to the exercise price of the optionsor the number of Shares over which the options are exercisable in the event ofAlbidon making a pro-rata issue of Shares or other securities to the holders ofShares in Albidon (other than a Bonus Issue as defined in paragraph (xiii)below). (xiii) If there is a bonus issue ("Bonus Issue") to the holders ofShares in Albidon, the number of Shares over which the options are exercisablewill be increased by the number of Shares which the holder would have receivedif the options had been exercised before the record date for the Bonus Issue ("Bonus Shares"). The Bonus Shares must be paid up by Albidon out of profits orreserves (as the case may be) in the same manner as was applied in the BonusIssue and upon issue rank equally in all respects with the other shares of theclass on issue as at the date of issue of the Bonus Shares. (xiv) In the event of a reconstruction (including consolidation,subdivision, return, reduction or pro rata cancellation) of the issued capitalof Albidon prior to the Expiry Date, the number of options to which each holderis entitled or the exercise price of the options or both shall be reconstructed(as appropriate) in accordance with the requirements of the Listing Rules whichapply at that time. (xv) The Company will at least 20 Business Days before the ExpiryDate of the options send notices to the option holders stating the name of theoption holder, the number of options held and the number of Shares to be issuedon exercise of the options, the exercise price, the due date for payment and theconsequences of non-payment. (xvi) All Options will vest and may be exercised: (i) within two months after a Change of Control Event has occurred; or (ii) following the triggering of a Mandatory Offer or receipt of a VoluntaryOffer. For the purposes of this clause: "Change of Control Event" means a shareholder, or a group of associatedshareholders, becoming entitled to sufficient shares in the Company to give itor them the ability, and that ability is successfully exercised, in generalmeeting, to replace all or a majority of the Board. "Mandatory Offer" as defined by the Article 11.7(c)(i) of the Company's Articlesof Association. "Voluntary Offer" as defined by the Article 11.7(c)(ii) of the Company'sArticles of Association. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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