16th Dec 2009 17:00
DiamondCorp plc
JSE share code: DMC
AIM share code: DCP
ISIN: GB00B183ZC46
(Incorporated in England and Wales)
(Registration number 05400982)
(SA company registration number 2007/031444/10)
('DiamondCorp' or 'the Company')
NOTICE OF GENERAL MEETING AND POSTING OF CIRCULAR
DiamondCorp, the Southern African diamond mining and exploration company, has today 16 December 2009 posted to shareholders a notice of meeting and circular with respect to a general meeting of shareholders to be held at 63 Coleman Street, London, EC2R 5BB on Friday 8 January 2010 at 12 noon (UK time) and 14:00 (SA time).
An electronic copy of the circular is available on the Company's website at www.diamondcorp.plc.uk.
Details of the resolutions which are to be proposed at the General Meeting are set out below.
Resolution 1: To be passed as a Special Resolution - Adoption of new Articles of Association and Deletion of the Company's Memorandum of Association
The Directors are asking shareholders to approve a number of amendments to the Current Articles, primarily to take account of changes in English company law brought about by the 2006 Act. An explanation of the main differences between the Current Articles and the New Articles is set out in the Appendix to the Notice of Meeting at pages 13 to 14. Other differences, which are of a minor, technical or clarifying nature, have not been noted in the said Appendix.
A copy of the New Articles showing the changes proposed to be made and the differences between the Current Articles and the New Articles is available for inspection, as noted on page 13 of the Notice of Meeting, and is available on the Company's website at http://www.diamondcorp.plc.uk. Resolution 1(a) in the Notice, which will be proposed as a special resolution, seeks the approval of shareholders to the adoption of the New Articles containing the proposed amendments to the Current Articles.
In addition, the 2006 Act significantly reduces the constitutional significance of a company's memorandum of association. The 2006 Act provides that a memorandum will record only the names of the original subscribers and the number of shares each subscriber has agreed to take in the company. Under the 2006 Act the objects clause and all other provisions which are contained in a company's memorandum, for existing companies at 1 October 2009, will be deemed to be contained in a company's articles of association unless the company passes a special resolution to the contrary. Further, the 2006 Act states that, unless a company's articles provide otherwise, a company's objects are unrestricted. This abolishes the need for companies to have objects clauses.
The Company is proposing to remove its objects clause together with all other provisions of its memorandum which, by virtue of the 2006 Act, are to be treated as forming part of the Company's articles of association to allow it to have the widest possible scope for its activities. Resolution 1(b) confirms the removal of these provisions for the Company. As the effect of this resolution will be to remove the statement currently in the Company's memorandum of association regarding limited liability, the New Articles also contain an express statement regarding the limited liability of shareholders.
Resolution 2: to be passed as a Special Resolution - Transfer of the Company from the Main Board of the JSE to Alt-X
Resolution 2 is to transfer the Company's listing on the JSE to a listing on Alt-X.
At the date of this announcement, approximately 11% of the Company's issued share capital is held by shareholders on the South African register. These shares trade on the JSE with trading being very illiquid. The remaining 89% of the Company's shares are held on the UK register. These shares trade on AIM where the bulk of trading takes place.
As the regulatory requirements of the JSE are more stringent than those of AIM, to avoid future potential conflicts between the JSE Rules (governing Main Board listings) and the AIM Rules, and to reduce administrative time and costs involved in meeting the more onerous requirements of the JSE Rules, the Company applied to the JSE on 27 October 2009 to transfer the listing of the Company's shares from the Main Board to Alt-X, which would result in the AIM Rules taking precedence and would give greater flexibility to the directors of DiamondCorp.
On 10 November 2009 the application was presented to the advisory committee of the Alt-X, and on 13 November 2009, DiamondCorp was informed by the JSE that DiamondCorp may apply for the transfer to Alt-X which was also subject to shareholder approval. DiamondCorp complies with the rules for admission to Alt-X and the continuing obligations of the AIM Rules and has formally applied to the JSE for the transfer to Alt-X which is also subject to shareholder approval. It is proposed that the transfer will take place from the commencement of trading on 11 January 2010.
In compliance with the JSE Rules, shareholders are advised of the risks of investing in a company listed on Alt-X, and that the JSE does not guarantee the viability or success of a company listed on Alt-X. The Company's JSE sponsor, Investec Bank Limited, has agreed to remain as the Company's sponsor on Alt-X.
Following a transfer of the Company's listing from the JSE Main Board to Alt-X no future announcements will be required to be published in the press in SA by the Company but will only be released on RNS and Sens.
Resolution 3: to be passed as an Ordinary Resolution - Grant of authority to the Directors to allot Ordinary Shares
At the annual general meeting of the Company held on 6 May 2009, shareholders passed a resolution giving the directors authority to allot Ordinary Shares up to the entire authorised but unissued share capital of the Company from time to time (after setting aside so many shares as may be required to be allotted and issued by the Company in terms of any share or scheme for the benefit of employees and/or directors). That power does not expire until the conclusion of the next annual general meeting of the Company, but as set out in the Appendix, once the New Articles have been adopted the Company will not be subject to the limitations of authorised share capital and accordingly the Directors took the view that it would be appropriate to propose a further, more limited, resolution giving the directors authority to issue Ordinary Shares. Accordingly, the Directors have proposed resolution 3 in the Notice to do this.
It is proposed to authorise the directors to allot Ordinary Shares up to a maximum nominal value of £212,544 (representing 7,084,800 Ordinary Shares) which is approximately equal to 15% of the issued share capital as at 14 December 2009 (being the latest practicable date prior to publication of the Notice of Meeting).
Save as otherwise set out in the Notice of Meeting the Directors currently intend only to make use of this authority for: (a) potentially for use as consideration in connection with any acquisitions of companies or businesses which the Company may wish to make; (b) in order to raise funds through subscriptions for new shares in order to finance any such acquisitions or otherwise as may be necessary to satisfy the working capital requirements of the Company's group; and, (c) in connection with the grant of options to the directors of the Company and employees of the Company's group.
This renewed authority would expire at the conclusion of next year's annual general meeting unless renewed or revoked before that time.
Resolution 4: to be passed as a Special Resolution - Disapplication of statutory pre-emption rights on allotment of shares
If the directors wish to allot unissued shares or other equity securities for cash or sell any shares which the Company may hold in treasury following a purchase of its own shares, section 561 of the 2006 Act requires that such shares or other equity securities are offered first to existing shareholders in proportion to their existing holdings. Section 570 of the 2006 Act allows, subject to certain conditions, section 561 to be disapplied if authorised by a special resolution of the members, and resolution 4 seeks to obtain this authority.
Resolution 4 seeks to grant the directors authority to allot equity securities or sell treasury shares for cash provided that such securities issued and allotted will not in the aggregate in any one financial year exceed 15% of the number of ordinary shares in the Company's issued share capital from time to time without first offering the securities to existing shareholders. The total number of Ordinary Shares in issue as at 14 December 2009 is 47,231,995. The Company does not currently hold any treasury shares. The proposed resolution also disapplies the statutory pre-emption provisions in connection with a rights issue and allows the directors, in the case of a rights issue, to make arrangements in relation to fractional entitlements or other legal or practical problems which might arise.
The Directors have no immediate plans to make use of this authority. This authority would expire at the conclusion of next year's annual general meeting.
Resolution 5: to be passed as an Ordinary Resolution - Ratification of the application to list 6,000,000 fully paid ordinary shares on the JSE
Resolution 5 seeks the ratification of the application by the Directors to list on the JSE, 6,000,000 Ordinary Shares issued on 3 November 2009.
16 December 2009
London
Sponsor: Investec Bank Limited
For further information, please contact:
Paul Loudon, DiamondCorp plc
+44 20 7256 2651
Joe Nally/Liz Bowman/Ivonne Cantu, Cenkos Securities plc
+44 20 7397 8900
Robert Smith/Tanis Crosby, Investec Bank Limited
+27 11 286 7662
Charmane Russell/Matthew Ross, Russell & Associates
+27 11 880 3924
Ana Ribeiro/Tim Blythe, Blythe Weigh Communications
+44 20 7138 3204
Related Shares:
DCP.L