13th Sep 2006 09:21
Albidon Limited13 September 2006 ALBIDON LTD ABN 86 107 288 755 NOTICE OF GENERAL MEETING AND EXPLANATORY MEMORANDUM Date of Meeting 29 September 2006 Time of Meeting 11:30am (WST) Place of Meeting 62 Colin Street, West Perth, Western Australia ALBIDON LIMITED ABN 86 107 288 755 NOTICE OF GENERAL MEETING NOTICE IS HEREBY GIVEN that the General Meeting of the shareholders of AlbidonLtd ("Company") will be held at 62 Colin Street, West Perth, Western Australiaon 29 September 2006, at 11:30am WST for the purpose of transacting thefollowing business. AGENDA An Explanatory Memorandum containing information in relation to each of thefollowing Resolutions accompanies this Notice of General Meeting. BUSINESS 1. RESOLUTION 1 - RATIFICATION OF PLACEMENT To consider and if thought fit, to pass, with or without amendment, thefollowing resolution as an ordinary resolution: - "That pursuant to Australian Stock Exchange ("ASX") Listing Rule 7.4shareholders approve and ratify the issue of 14,150,000 ordinary fully paidshares in the capital of the Company ("Shares") at a price of 95 cents each, andotherwise on the terms and conditions and in the manner described in theExplanatory Memorandum accompanying this Notice." Voting Exclusion - The Company will disregard any votes cast on this Resolution1 by any person who participated in the issue; and any associate of that person.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. 2. RESOLUTION 2 - APPROVAL OF ISSUE OF SHARES To consider and, if thought fit, to pass, with or without amendment, thefollowing resolution as an ordinary resolution:- "That for the purposes of ASX Listing Rule 7.1 and for all other purposes,approval is given for the Company to allot and issue up to 30,000,000 Shares bya placement at an issue price that is not less than 90% of the average marketprice calculated over the last 5 days on which sales of securities were recordedbefore the day on which the issue is made and otherwise on the terms andconditions set out in the Explanatory Memorandum accompanying this Notice." Voting Exclusion - The Company will disregard any votes cast on this Resolution2 by any person who may participate in the issue, any person who might obtain abenefit, except a benefit solely in the capacity of an ordinary security holderand any person who participated in the issue, if the Resolution is passed, orany associate of those persons. However, the Company need not disregard a voteif it is cast by a person as proxy for a person who is entitled to vote, inaccordance with the directions on the proxy form; or it is cast by the personchairing the meeting as proxy for a person who is entitled to vote, inaccordance with a direction on the proxy form to vote as the proxy decides. 3. RESOLUTION 3 - RATIFICATION OF THE GRANT OF UNLISTED INCENTIVEOPTIONS TO KEY PERSONNEL To consider and if thought fit, to pass, with or without amendment, thefollowing resolution as an ordinary resolution: "That pursuant to ASX Listing Rule 7.4, shareholders approve and ratify thegrant of 600,000 unlisted options exercisable at AUD$1.05 each expiring on orbefore 30 June 2009 to the parties identified, and otherwise, on the terms andconditions set out in the Explanatory Memorandum accompanying this Notice." Voting Exclusion - The Company will disregard any votes cast on this Resolution3 by the parties identified in the Explanatory Memorandum and any personassociated with those parties. However, the Company need not disregard a voteif it is cast by a person as proxy for a person who is entitled to vote, inaccordance with the directions on the proxy form or it is cast by the personchairing the meeting as proxy for a person who is entitled to vote, inaccordance with a direction on the proxy form to vote as the proxy decides. By order of the Board Mr Nicholas DayCompany SecretaryDated: 13 September 2006 Proxies -Registered shareholders for the Company only can vote at the meetingeither personally or by proxy, attorney or representative. A shareholderentitled to attend and vote at the above meeting may appoint not more than twoproxies to attend and vote at this meeting. Where more than one proxy isappointed, each proxy must be appointed to represent a specified proportion ofthe shareholder's voting rights. A proxy may but need not be a shareholder ofthe Company. The instrument appointing of a proxy must be in writing, executedby the appointor or his/her attorney duly authorised in writing or, if suchappointer is a corporation, either under seal or under hand of an officer or his/her attorney duly authorised. The instrument of proxy (and the power ofattorney or other authority, if any, under which it is signed) must be lodged byperson, post, courier or facsimile and reach the Registered office of theCompany not later than 11:30am Western Australian Standard Time on 27 September2006. For the convenience of shareholders a Proxy Form is enclosed with noticessent to shareholders. A shareholder that is a corporation may elect to appoint arepresentative in accordance with the Articles of Association in which case theCompany will require written proof of the representative's appointment whichmust be lodged with, or presented to the Company not later than 11:30am WesternAustralian Standard Time on 27 September 2006. CHESS Depositary Interests - Holders of CHESS Depositary Interests ("CDI") areinvited to attend the meeting but are not entitled to vote at the meeting. Inorder to have votes cast at the Meeting on their behalf, CDI holders mustcomplete, sign and return the CDI Notice of Direction enclosed with the Noticesent to them to Computershare Investor Services Pty Limited, Level 2, 45 StGeorges Terrace, Perth, WA 6000, Australia or GPO Box D182, Perth WA 6840,Australia so that CDI holders can direct CHESS Depositary Nominees Pty Ltd tovote the underlying shares on their behalf. The CDI Notice of Direction needs tobe received at the address shown on the form by not later than 11:30 am WST on27 September 2006. CREST Depositary Interests- Holders of CREST Depositary Interests ("CRDI") areinvited to attend the meeting but are not entitled to vote at the meeting. Inorder to have votes cast at the Meeting on their behalf, CRDI holders mustcomplete, sign and return the instruction form enclosed with the Notice sent tothem to Computershare Investor Services PLC, PO BOX 82, The Pavilions,Bridgewater Road, Bristol BS99 7NH so that CRDI holders can direct ComputershareCompany Nominees Limited to vote the underlying shares on their behalf. TheInstruction Form needs to be received at the address shown on the form by notlater than 11:30 am Western Australian Standard Time (being 4:30 am London Time)on 27 September 2006. ALBIDON LTD ABN 86 107 288 755 EXPLANATORY MEMORANDUM This Explanatory Memorandum is intended to provide shareholders with sufficientinformation to assess the merits of the Resolutions contained in theaccompanying Notice. The Directors recommend that shareholders read this Explanatory Memorandum infull before making any decision in relation to the Resolutions. RESOLUTION 1 - RATIFICATION OF PLACEMENT The Company has previously announced on 21 June 2006 the placement ("Placement")of 14,150,000 Shares at an issue price of 95 cents (38 pence) each to raiseA$13.4 million (£5.4) (before expenses). 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. ASXListing 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 permits the ratification of previous issues of securities madewithout prior shareholder approval, provided the issue did not breach the 15%threshold set by Listing Rule 7.1. The effect of such a ratification is torestore a company's maximum discretionary power to issue further shares up to15% of the issued capital of the company without requiring shareholder approval.Shareholder approval for the Placement is sought pursuant to ASX ListingRule7.4. For the purpose of Listing Rule 7.4,the following additional information isprovided pursuant to Listing Rules 7.5 : 1. The maximum number of securities to be issued (or to be ratified, forany Shares out of the 14,150,000 Shares which have been issued before thismeeting) under this Resolution is 14,150,000 Shares. 2. The Shares have been issued for 95 cents each. 3. The allottees were: Allottees No. of SharesCMG Capital Pty Ltd 1,500,000African Lion 2 Limited 3,500,000Clients of Numis Securities 5,400,000Contango Asset Management Limited 250,000Colonial First State 500,000Independant Asset Management 2,000,000RMB Resources Ltd 1,000,000Total 14,150,000 4. The Shares are fully paid ordinary shares ranking pari passu in allrespects with all other ordinary shares in the Company on issue; and 5. The purpose of the raising is to complete a Feasibility Study on theCompany's Munali Nickel Project in Zambia and additional exploration programs inother areas, as follows: a) Commence pre-production activities at the Munali Nickel Project toaccelerate the development of the project; b) Continuation of step-out drilling aimed at expanding the Enterpriseresource at Munali; c) Follow-up drilling to delineate further nickel resources within theMunali Intrusion, to the north of the Enterprise deposit; d) Drilling to test additional targets defined by geophysics and geologyin the Munali district;and e) General operating expenses. The Board recommends shareholders vote in favour of this Resolution as it allowsthe Company to ratify the Placement and retain the flexibility to issue furtherequity securities representing up to 15% of the Company's share capital duringthe next 12 months. RESOLUTION 2 - APPROVAL OF ISSUE OF SHARES The Company is proposing to issue up to 30,000,000 Shares. The number ofsecurities to be issued (the aggregate of the Shares proposed to be issued) isin excess of the number of securities that can be issued by the Company withoutshareholder approval. ASX Listing Rule 7.3 sets out the information to beprovided to shareholders to allow them to make an informed decision. Set out below is this information: 1. The maximum number of securities to be issued is 30,000,000 Shares. 2. The securities will be issued within 3 months of the dateof shareholder approval or such later date as approved by ASX. 3. The issue price of the Shares will be not less than 90% ofthe average market price calculated over the last 5 days on which sales ofsecurities were recorded before the day on which the issue is made. 4. At the date of this Explanatory Memorandum, the names ofthe proposed allottees and quantity to be issued to each allottee are not knownhowever, the Company plans to approach investors to whom a prospectus does notneed to be provided under the Corporations Act. 5. The Shares will be fully paid and will rank pari passu withexisting ordinary shares on issue. 6. The purpose of the raising is assist in the funding of theMunali Project. The balance of the funds required will be debt funded. TheCompany will also retain a modest cash reserve for working capital purposes. Thefunds raised will be used to assist in the purchase of the following expenditureitems: Concentrator US$ 36 Million Surface Infrastructure, including TSF1, Concentrate Storage US$ 14 Million Mine Infrastructure US$ 5 Million Contingencies US$ 9 Million Miscellaneous US$ 1 Million TOTAL US$ 65 Million (1Tailings Storage Facility). Given the inherent uncertainties that are associated with mining, the Company'sbudgets are subject to change and will be dependent on results from ongoingevaluation activities. 7. The securities may be allotted progressively. The Companymay not necessarily issue the full complement of securities and may issue alesser number. The Directors unanimously recommend that shareholders vote in favour of thisresolution. RESOLUTION 3 - RATIFICATION OF THE GRANT OF UNLISTED INCENTIVE OPTIONS TO KEYPERSONNEL As announced on the 15th of July 2006 the Board has approved the issue ofincentive options, subject to shareholder approval, to the parties listed belowin accordance with services agreements with each of the parties. The optionsare exercisable at AUD$1.05 each on or before 30 June 2008 and otherwise on theterms set out in Appendix A to this Explanatory Memorandum. Each option entitlesthe holder to subscribe for one Share on payment of the exercise price. 30% ofthe options granted to each holder are exercisable on or after 1 January 2007.The next 30% of the options granted are exercisable on or after 1 January 2008and the remaining 40% of the options granted are exercisable on or after 1January 2009. Approvals Required Under this Resolution, the Company seeks from shareholders approval for, andratification of, the issues of securities set out below pursuant to Listing Rule7.4 so as to limit the restrictive effect of ASX Listing Rule 7.1 on any furtherissues of securities in the next 12 months. The grant of the options the subject of this Resolution did not breach ListingRule 7.1. For the purposes of Listing Rule 7.5, the following information is provided toshareholders: 1. The total number of options granted is 600,000; 2. The options were granted as part remuneration pursuant toservices agreements with each of the allottees; 3. The terms and conditions of the options granted are set outin Appendix A to this Explanatory Memorandum; 4. No funds were raised by the grant of options. 5. The allottees were: Allottee AmountChairman of Albidon Zambia Ltd 100,000Senior Resource Geologist 150,000Construction Manager 100,000Inhouse Legal Counsel 150,000Head of Health, Safety, Environment and Community Relations 50,000Senior Geologist in Zambia 50,000Total 600,000 No Company Directors are participating. The Board believes that the ratification of this issue is beneficial for theCompany. The Board recommends shareholders vote in favour of this Resolution as it allowsthe Company to ratify the above grant of options and retain the flexibility toissue further equity securities representing up to 15% of the Company's sharecapital during the next 12 months. GLOSSARY "ASX" means Australian Stock Exchange Limited; "AIM" means Alternative Investment Market Alternative Investment Market of theLondon Stock Exchange. "Board" means the board of Directors; "Company" or "Albidon" means Albidon Ltd; "Corporations Act" means Corporations Act 2001 of the Commonwealth of Australia; "Directors" means the directors of Albidon from time to time; "Explanatory Memorandum" means this explanatory memorandum attached to theNotice, which provides information to shareholders about the Resolutionscontained in the Notice; "Listing Rules" means the Listing Rules of ASX; "Notice" means the notice of meeting which accompanies this ExplanatoryMemorandum; "Resolution" means a resolution contained in the Notice; "Shares" means fully paid ordinary shares issued in the capital of the Company;and "WST" means Australian Western Standard Time. Appendix A - Terms of the Executive Unlisted Options under Resolution 3 (i) DEFINITIONS AND INTERPRETATION "Bid Period", in relation to a takeover bid in respect of shares in the Company,means the period referred to in the definition of that expression in section 9of the Corporations Law provided that where a takeover bid is publicly announcedprior to the service of a bidder's statement on the Company in relation to thattakeover bid, the Bid Period shall be deemed to have commenced at the time ofthat announcement; "Board" means the board of directors of the Company as constituted from time totime; "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 in general meeting, to replace all or a majority of theBoard; "Dollars" or "$" is a reference to the lawful currency from time to time ofAustralia; (ii) Each option entitles the holder to subscribe for one Sharein Albidon Limited. (iii) Application will not be made for Official Quotation of theoptions. (iv) The options in accordance with the vesting terms in (vi)below and are exercisable on or before 5pm (Australian WST) on 30 June 2009 ("Expiry Date") by completing an option exercise form and delivering it toAlbidon's registered office with the exercise monies. (v) The option exercise price is AUD$1.05.per Share. (vi) Options vest as follows: o 33% of the holder's options are exercisable on or after 1 January 2007; o 33% of the holder's options are exercisable on or after 1 January 2008; and o the balance of the holder's options are exercisable on or after 1 January 2009. (vii) All Options will vest and may be exercised: (a) within two months after a Change of Control Event has occurred; or (b) during a Bid Period; or (c) on an application under section 411 of the Corporations Act of Australia, if a court orders a meeting to be held concerning a proposed compromise or arrangement for the purposes of or in connection with a scheme for the reconstruction of the Company or its amalgamation with any other company. (viii) The options are not transferable, without prior approval of the Board. (ix) Subject to the Boards discretion, unvested options will lapse if the holder terminates services provided to the Company and all vested options will need to be exercised within 28 days. (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 securities 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, the record date will be at least 9 business days after the issue isannounced. This will give option holders the opportunity to exercise theiroptions prior to the date for determining entitlements to participate in anysuch 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 rate issue of Shares or other securities to the holders ofShares in Albidon (other than a Bonus Issue as defined in paragraph (ix) 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 Day 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. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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