EUROPEAN METALS HOLDINGS LIMITED European Metals Holdings Limited
ARBN 154 618 989
Notice of Annual General Meeting
The annual general meeting of the Company will be held at Ground Floor, 41 Colin Street, West Perth, Western Australia on Friday, 22 December 2023 at 3:00pm (AWST) (7:00am GMT).
If you are unable to attend the Meeting, please complete the Proxy Form enclosed and return it to Computershare as soon as possible and no later than 7.00am (GMT) on 20 December 2023.
This is an important document. Please read it carefully and in its entirety. If you do not understand it, please consult with your financial and/or other professional adviser immediately.
Shareholders are urged to attend or vote by lodging the Proxy Form or Voting Instruction Form attached to this Notice.
Contents | ||
6 | Resolution 4 - Adoption of New Constitution | 9 |
7 | Resolution 5 - Appointment of Auditor | 13 |
8 | Resolution 6 - Approval of Employee Incentive Plan | 14 |
9 | Resolution 7 - Approval of 10% Placement Facility | 15 |
10 | Action to be taken by Shareholders | 19 |
SCHEDULE 1 DEFINITIONS | 22 | |
SCHEDULE 2 SUMMARY OF SUBSCRIPTION AGREEMENT | 25 | |
SCHEDULE 3 KEY TERMS OF THE EUROPEAN METALS HOLDINGS LIMITED EQUITY | ||
INCENTIVE PLAN | 26 | |
ANNEXURE 1 - NEW CONSTITUTION | ||
Key Dates | ||
Dispatch of notice of meeting to Shareholders | 6 December 2023 | |
Shareholder Voting entitlement date | 19 December 2023 at 6:00pm (GMT) | |
Australian CDI Voting close | 19 December 2023 at 3:00pm (AWST) | |
Depositary Interest Voting close | 19 December 2023 at 2:00pm (GMT) | |
Proxy close | 20 December 2023 at 7:00am (GMT) |
Annual General Meeting
22 December 2023 at 3:00pm (AWST) / 7:00am (GMT)
Important notices
Not investment advice
This booklet does not take into account the investment objectives, financial situation, tax position or particular needs of any Shareholder of the Company or any other person. This booklet should not be relied upon as the sole basis for any decision in relation to Shares or any other securities. Shareholders should consider seeking independent advice before making any decision regarding the resolutions to be put to the Meeting.
Meeting Booklet | European Metals Holdings Limited
Notice of Meeting
Notice is hereby given that an annual general meeting of Shareholders of European Metals Holdings Limited (Company) will be held at Ground Floor, 41 Colin Street, West Perth, Western Australia on Friday, 22 December at 3:00pm (AWST) (7.00 am GMT) (Meeting).
The Explanatory Memorandum provides additional information on matters to be considered at the Meeting. The Explanatory Memorandum and the Proxy Form form part of this Notice.
The Directors have determined pursuant to Article 7.11 of its Articles of Association that the persons eligible to vote at the Meeting are those who are registered as Shareholders on 19 December 2023 at 6:00pm (GMT).
Terms and abbreviations used in this Notice (including the Explanatory Memorandum) are defined in Schedule 1.
Resolution 1 - Re-election of Director - Mr Keith Coughlan
To consider and, if thought fit, to pass with or without amendment, as an ordinary resolution the following:
"That, pursuant to and in accordance with Listing Rule 14.4 and Article 8.6 of the Company's Articles of Association and for all other purposes, Mr Keith Coughlan retires, and being eligible, is re-elected as a Director on the terms and conditions in the Explanatory Memorandum."
Resolution 2 - Ratification of EBRD Subscription Shares
To consider and, if thought fit, to pass with or without amendment, as an ordinary resolution the following:
"That, pursuant to and in accordance with Listing Rule 7.4 and for all other purposes, Shareholders ratify the prior issue of 12,315,213 Shares to EBRD on the terms and conditions in the Explanatory Memorandum."
Voting Exclusion: The Company will disregard any votes cast in favour of Resolution 2 by or on behalf of EBRD or an associate of EBRD.
However, this does not apply to a vote cast in favour of Resolution 2 by:
- a person as proxy or attorney for a person who is entitled to vote on Resolution 2, in accordance with the directions given to the proxy or attorney to vote on Resolution 6 in that way; or
- the Chair as proxy or attorney for a person who is entitled to vote on Resolution 2, in accordance with a direction given to the Chair to vote on Resolution 2 as the Chair decides; or
-
a holder acting solely in a nominee, trustee, custodial or other fiduciary capacity on behalf of a beneficiary provided the following conditions are met:
o the beneficiary provides written confirmation to the holder that the beneficiary is not excluded
from voting, and is not an associate of a person exclude from voting, on Resolution 2; and
o the holder votes on Resolution 2 in accordance with directions given by the beneficiary to the holder to vote in that way.
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Resolution 3 - Migration of the Company to Australia
To consider and, if thought fit, to pass with or without amendment, as a special resolution the following:
"That, subject to the passing of Resolution 4 and compliance with the requirements of each of the Corporations Act and BVI Business Companies Act, approval is given for the Company to make an application to the BVI Registry of Corporate Affairs for removal from the BVI Register of Companies pursuant to the provisions of the BVI Business Companies Act, and for registration of the Company as a public company limited by shares with ASIC pursuant to the provisions of section 601BC of the Corporations Act on the terms contained in the Explanatory Memorandum."
Resolution 4 - Adoption of Constitution
To consider and, if thought fit, to pass with or without amendment, as a special resolution the following:
"That, pursuant to and in accordance with the Articles of Association of the Company and for all other purposes, subject to the passing of Resolution 3 and the registration of the Company as a public company limited by shares with ASIC, the Company adopt the Constitution on the terms and conditions in the Explanatory Memorandum, in substitution for the existing Articles of Association of the Company, effective on the date that the Company is registered with ASIC."
Resolution 5 - Appointment of Auditor
To consider and, if thought fit, to pass with or without amendment, as an ordinary resolution the following:
"That, for all purposes, BDO Audit Pt Ltd, having consented in writing to act in the capacity of auditor, be appointed as auditor of the Company with effect from the end of the Meeting."
Resolution 6 - Approval of Employee Incentive Scheme
To consider and, if thought fit, to pass with or without amendment, as an ordinary resolution the following:
"That, for the purposes of ASX Listing Rule 7.2 (Exception 13(b)), and for all other purposes, approval is given to enable the Company to issue Equity Incentives under the employee incentive scheme titled "European Metals Holdings Limited Equity Incentive Plan", on the terms and conditions set out in the Explanatory Statement."
Voting Exclusion: The Company will disregard any votes cast in favour of Resolution 6 by or on behalf of a person who is eligible to participate in the European Metals Holdings Equity Incentive Plan, or an associate of that person or those persons.
However, this does not apply to a vote cast in favour of Resolution 6 by:
- a person as proxy or attorney for a person who is entitled to vote on Resolution 6, in accordance with the directions given to the proxy or attorney to vote on Resolution 6 in that way; or
- the Chair as proxy or attorney for a person who is entitled to vote on Resolution 6, in accordance with a direction given to the Chair to vote on Resolution 6 as the Chair decides; or
-
a holder acting solely in a nominee, trustee, custodial or other fiduciary capacity on behalf of a beneficiary provided the following conditions are met:
o the beneficiary provides written confirmation to the holder that the beneficiary is not excluded
from voting, and is not an associate of a person exclude from voting, on Resolution 6; and
o the holder votes on Resolution 6 in accordance with directions given by the beneficiary to the holder to vote in that way.
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Voting Prohibition Statement: A person appointed as a proxy must not vote, on the basis of that appointment, on Resolution 6 if:
-
the person is either:
o a member of the Key Management Personnel; or o a Closely Related Party of such a member; and - the appointment does not specify the way the proxy is to vote on Resolution 6. However, the above prohibition does not apply if:
- the proxy is the Chair; and
- the appointment expressly authorises the Chair to exercise the proxy even if Resolution 6 is connected directly or indirectly with the remuneration of a member of the Key Management Personnel.
Resolution 7 - Approval of 10% Placement Facility
To consider and, if thought fit, to pass with or without amendment, as a special resolution the following:
"That, in accordance with Listing Rule 7.1A and for all other purposes, Shareholders approve the issue of Equity Securities of up to 10% of the issued capital of the Company (at the time of issue) calculated in accordance with the formula prescribed in Listing Rule 7.1A.2 and on the terms and conditions in the Explanatory Memorandum."
Voting Exclusion: The Company will disregard any votes cast in favour of Resolution 7 by or on behalf of a person who is expected to participate in the 10% Placement Facility, or any person who will obtain a material benefit as a result of, the proposed issue (except a benefit solely by reason of being a holder of ordinary securities in the Company) or an associate of that person or those persons.
However, this does not apply to a vote cast in favour of Resolution 7 by:
- a person as proxy or attorney for a person who is entitled to vote on Resolution 7, in accordance with the directions given to the proxy or attorney to vote on Resolution 7 in that way; or
- the Chair as proxy or attorney for a person who is entitled to vote on Resolution 7, in accordance with a direction given to the Chair to vote on Resolution 7 as the Chair decides; or
-
a holder acting solely in a nominee, trustee, custodial or other fiduciary capacity on behalf of a beneficiary provided the following conditions are met:
o the beneficiary provides written confirmation to the holder that the beneficiary is not excluded
from voting, and is not an associate of a person exclude from voting, on Resolution 7; and
o the holder votes on Resolution 7 in accordance with directions given by the beneficiary to the holder to vote in that way.
Dated: 1 December 2023
By order of the Board
Shannon Robinson
Company Secretary
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Explanatory Memorandum
1 Introduction
This Explanatory Memorandum has been prepared for the information of Shareholders in connection with the business to be conducted at the Meeting to be held at Ground Floor, 41 Colin Street, West Perth, Western Australia on 22 December 2023 at 3:00pm (AWST) (7:00am GMT).
This Explanatory Memorandum together with the Proxy Form at Annexure 1 each form a part of this Notice. This Explanatory Memorandum contains the terms and conditions on which the Resolutions will be voted.
2 Resolution 1 - Re-election of Director
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General
Listing Rule 14.4 provides that no Director shall hold office past the third annual general meeting following their appointment or 3 years, whichever is longer.
In addition, Article 8.6 of the Articles of Association sets out the requirements for determining which Directors are to retire by rotation at an annual general meeting. - Mr Keith Coughlan
Keith Coughlan was appointed as a Director on 6 September 2013 and was last elected by Shareholders at the 2020 annual general meeting held on 17 December 2020. In accordance with Listing Rule 14.4 and the Articles of Association, Mr Coughlan will retire and being eligible, seeks re-election from Shareholders.
Resolution 1 is an ordinary resolution. If Resolution 1 is passed, Mr Coughlan will be re-elected as a Director. At the time of this Annual General Meeting, Mr Coughlan's term of office will be approximately 10 years. Mr Coughlan is an Executive Chairman. If Resolution 1 is not passed, Mr Coughlan will not be re-elected as a Director.
The Board (excluding Mr Coughlan) recommends that Shareholders vote in favour of Resolution 1.
Qualifications and other material directorships
Mr Coughlan has almost 30 years' experience in stockbroking and funds management. He has been largely involved in the funding and promoting of resource companies listed on ASX, AIM and TSX. He has advised various companies on the identification and acquisition of resource projects and was previously employed by one of Australia's then largest funds management organisations.
Mr Coughlan is Non-Executive Chair of Doriemus Plc (ASX:DOR).
3 Background to Resolutions 2, 3 and 4
As announced on 21 July 2023, the European Bank for Reconstruction and Development (EBRD) agreed to invest €6 million to support the Company's development of the Cinovec project in the Czech Republic (EBRD Subscription) via the entry into a subscription agreement (EBRD Subscription Agreement) and a project support agreement (EBRD Project Support Agreement).
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EBRD is owned by the European Union, European Investment Bank and 71 countries, including the Czech Republic.
Pursuant to the EBRD Subscription Agreement the Company issued 12,315,213 Shares to ERBD (EBRD Subscription Shares) on 23 August 2023 (Issue Date).
Under the EBRD Project Support Agreement, the Company provided undertakings to EBRD to comply with certain EBRD policies and requirements and, subject to certain conditions, EBRD has been granted rights that allow participation in future financings to maintain its pro rata equity interest in the Company.
To facilitate further investor interest in the Company, the Board has resolved, subject to Shareholder approval pursuant to Resolution 3, to migrate the Company from the British Virgin Islands to Australia (Migration). The Migration will necessitate the adoption of new articles of association (referred to as a constitution in Australia) which is appropriate for and compliant with Australian law (New Constitution).
Resolutions 3 and 4 are inter-conditional. That is, one will not pass without the other given the interrelated nature of the approvals.
Resolution 5 is inter-conditional on Resolution 3 only. However, Resolution 3 is not inter- conditional on the passing of Resolution 5.
4 Resolution 2 - Ratification of EBRD Subscription Shares
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Background
The EBRD Subscription will support the Company's development of the Cinovec project in the Czech Republic. The proceeds will be used to assist in funding pre-development works and studies for the Cinovec project including preliminary works on alternative production processes and environmental works, and working capital expenditures for the period up to the completion of a definitive feasibility study.
In addition to the funds raised, the Company's relationship with EBRD is expected to be highly strategic as the EU charts a path towards greater supply security and sustainability. Support for the Company's greenfield zinnwaldite lithium Cinovec project aligns with these EU goals.
Resolution 2 is an ordinary resolution and seeks Shareholder approval to ratify the issue of the EBRD Subscription Shares. - Listing Rule 7.4
Broadly speaking, and subject to a number of exceptions, Listing Rule 7.1 limits the amount of equity securities that a listed company can issue without the approval of its shareholders over any 12 month period to 15% of the fully paid ordinary securities it had on issue at the start of that period.
The issue of the EBRD Subscription Shares do not fit within any of these exceptions and, as it has not yet been approved by the Company's shareholders, it effectively uses up part of the 15% limit in Listing Rule 7.1, reducing the Company's capacity to issue further equity securities without shareholder approval under Listing Rule 7.1 for the 12 month period following the Issue Date.
Listing Rule 7.4 allows the shareholders of a listed company to approve an issue of equity securities after it has been made or agreed to be made. If they do, the issue is taken to have been approved under Listing Rule 7.1 and so does not reduce the company's capacity to issue further equity securities without shareholder approval under that rule.
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The Company wishes to retain as much flexibility as possible to issue additional equity securities into the future without having to obtain Shareholder approval for such issues under Listing Rule 7.1.
To this end, Resolution 2 seeks Shareholder approval to issue the EBRD Subscription Shares under and for the purposes of Listing Rule 7.4.
If Resolution 2 is passed, the EBRD Subscription Shares will be excluded in calculating the Company's combined 25% limit in Listing Rules 7.1 and 7.1A, effectively increasing the number of equity securities the Company can issue without Shareholder approval over the 12 month period following the date of issue of the EBRD Subscription Shares.
If Resolution 2 is not passed, the EBRD Subscription Shares will be included in calculating the Company's combined 25% limit in Listing Rules 7.1 and 7.1A, effectively decreasing the number of equity securities the Company can issue without Shareholder approval over the 12 month period following the date of issue of the EBRD Subscription Shares.
It is noted that the Company's ability to utilise the additional 10% capacity provided for in Listing Rule 7.1A for issues of equity securities following this Meeting remains conditional on Resolution 7 being passed at this Meeting.
4.3 Specific information required by Listing Rule 7.5
In accordance with Listing Rule 7.5, information relating to the EBRD Subscription is as follows:
- the EBRD Subscription Shares were issued to European Bank for Reconstruction and Development;
- 12,315,213 fully paid ordinary shares were issued utilising the Company's 15% placement capacity under Listing Rule 7.1;
- the EBRD Subscription Shares are fully paid ordinary shares and rank equally in all respects with the Company's existing Shares;
- the EBRD Subscription Shares were issued on 23 August 2023;
- the EBRD Subscription Shares were issued at a price of £0.423 per Share (being AUD 0.803 equivalent per Share). The issue price was calculated by reference to the volume weighted average trading price of the Company's Shares on the ASX on the five trading days preceding the date of signing of the EBRD Subscription Agreement;
- the funds raised from the issue of the EBRD Subscription Shares will be used to assist in funding pre-development works and studies for the establishment of mining area at the greenfield zinnwaldite lithium Cinovec deposit located in the Krusne Hory Mountains in Czech Republic, including the further development of a definitive feasibility study, preliminary works on alternative production processes and environmental works, and working capital expenditures for the period up to the completion of the feasibility study;
- the EBRD Subscription Shares were issued pursuant to the EBRD Subscription Agreement on standard terms and conditions except that EBRD was granted certain ongoing rights. The material terms of those rights are summarised in Schedule 2 of this Notice; and
- a voting exclusion statement is included in this Notice for Resolution 2.
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4.4 Director recommendation
The Board believes that Resolution 2 is in the best interests of the Company and its Shareholders and unanimously recommend that Shareholders vote in favour of this Resolution.
The Chairman intends to vote undirected proxies in favour of the Resolution.
5 Resolution 3 - Migration of the Company to Australia
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Background
The Company is currently registered under the BVI Business Companies Act and registered as a foreign company under the Corporations Act. The Company is seeking the approval of Shareholders to migrate to Australia which involves applying to ASIC to register as an Australian public company limited by shares under the Corporations Act.
As noted in section 3, the Board has resolved to propose the Company's migration from BVI to Australia as the Board is of the view that the advantages of the migration outweigh the disadvantages. Details of the advantages and disadvantages, as identified by the Board, are set out in sections 5.3 and 5.4 respectively.
Resolution 3 is a special resolution and therefore requires approval of 75% of the votes cast by Shareholder's present and eligible to vote (in person, by proxy, by attorney or, in the case of a corporate Shareholder, by a corporate representative). - Process
The removal of the Company (as a company limited by shares) from the register maintained by the BVI Registrar of Corporate Affairs under the BVI Business Companies Act and the registration of the Company (as a public company limited by shares) under the Corporations Act does not create a new legal entity, materially affect the Company's existing rights or obligations or affect or render defective any legal proceedings by or against the Company or its Shareholders. From all practical points of view the Company remains the same legal entity.
As between the Company and the Shareholders, those rights will change to the extent that the Company and its relationship with Shareholders will be governed by the Corporations Act and not by the BVI Business Companies Act.
Further, because a new Constitution is to be adopted as part of the process, there will be minor changes to the rights of the Shareholders pursuant to that Constitution. The adoption of the new Constitution is the subject of Resolution 4. For further details see section 6.
Under the BVI Business Companies Act the transfer of registration requires the Company's BVI registered agent to file with the BVI Registrar of Corporate Affairs: - a notice of intention to continue out of the BVI, and a declaration that the statutory advertisement and notice requirements have been complied with;
- a Director's declaration to attest compliance with the requirements of Australian law; and
- certificate of continuance (or provisional certificate of continuance) from the companies registry in the new jurisdiction (ie ASIC),
(together the Discontinuance Documents).
Upon due filing the Discontinuance Documents, the BVI Registrar of Corporate Affairs shall issue a certificate of discontinuance. The certificate of discontinuance is prima facie evidence
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that all the requirements of the BVI Business Companies Act in respect of the continuation of a company under the laws of a foreign jurisdiction have been complied with, and that the company was discontinued on the date specified in the certificate of discontinuance. It therefore provides the date that the redomicile became effective.
If approved, it is expected that the migration will be implemented in accordance with the following timetable:
Annual General Meeting
Lodge application for migration (ASIC Form 202) with ASIC
Lodge Discontinuance Documents with BVI Registrar of Corporate Affairs
Obtain certificate of discontinuance from BVI Registrar of Corporate Affairs and effective date of the migration
22 December 2023
Approximately 15 March 2024
Approximately 9 April 2024
Approximately 30 April 2024
Due to material uncertainty as to the time necessary to achieve these steps, these dates are provided on a best efforts basis and are subject to change. The market will be updated once these steps have been undertaken and clarity as to timelines is provided.
5.3 Advantages of the migration
The Board considers that the migration of the Company to Australia is in the best interests of Shareholders for the reasons set out below.
Reputational impact ofassociation with offshore financial centres
Best practice corporategovernance
Stronger nexus to Australia
Regulatory
Tax implications
The BVI's international reputation has been negatively impacted by high profile and controversial cases of tax evasion, fraud schemes, global crime and suspected money laundering.
Investors such as EBRD have expressed a reluctance to invest in companies domiciled in offshore financial centres. The Board is of the view that moving the domicile of the Company to Australia will unlock a larger pool of potential investors (in terms of both equity and debt).
Australia has a reputation for robust legislation and stringent regulatory requirements. These requirements will ensure the Company maintains best practice corporate governance. The Company will continue to comply with the ASX Corporate Governance Council's Corporate Governance Principles and Recommendations.
The Company's head office, the majority of its management and its advisors reside in Australia. The majority of Shareholders reside in Australia.
The Company is already registered as a foreign company in Australia and therefore already complies with those Australian regulations applicable to foreign companies. Following the redomicile, the Company will no longer have to comply with BVI regulations. This will save on regulatory and legal costs and management time and effort.
BVI companies are exempt from corporate taxes and stamp duty, even if they are administered in BVI. The parent Company is currently an
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European Metals Holdings Ltd. published this content on 01 December 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 01 December 2023 05:54:13 UTC.
