TIDMDME
AIM Release
14 October 2011
2011 Annual General Meeting
Please find attached the following 2011 Annual General Meeting documents for
Discovery Metals Limited, which is being dispatched to all shareholders:
1. Notice of Meeting, with accompanying Explanatory Memorandum; and
2. Proxy Form.
The 2011 Annual General Meeting will be held at 11:00 am (Brisbane time) on
Tuesday, 22 November 2011 at:
Christie Corporate Conference Centre
Teach and Laffite Room
Level 1, 320 Adelaide Street
Brisbane, Queensland
The 2011 Annual Report has also been dispatched to shareholders who requested a
hard copy.
All the above documents are also available on the Company's website:
www.discoverymetals.com
Yours faithfully
Gregory Seeto
Company Secretary
Discovery Metals Limited
NOTICE OF ANNUAL GENERAL MEETING
NOTICE IS HEREBY GIVEN that an Annual General Meeting of the Shareholders of
DISCOVERY METALS LIMITED ACN 104 924 423 (the Company) will be held on Tuesday,
22 November 2011, commencing at 11:00 am (Brisbane time) at Christie Corporate
Conference Centre, Teach and Laffite Room, Level 1, 320 Adelaide Street,
Brisbane, Queensland. Registration will commence just prior to the meeting.
This Notice of Meeting incorporates, and should be read together with, the
Explanatory Memorandum and Proxy Form.
Ordinary Business
Receipt of financial statements and reports
To receive and consider the Directors' report and financial statements of the
Company for the year ended 30 June 2011 and the Auditor's report in relation to
the financial statements.
Resolutions
1. Adoption of remuneration report (non-binding resolution)
To consider and if thought fit, pass the following resolution as an ordinary
resolution:
"That the Remuneration Report as disclosed in the Directors' Report for the year
ended 30 June 2011 is approved for the purposes of the Corporations Act."
Note: Under the Corporations Act, this resolution is advisory only and does not
bind the Directors or the Company.
2. Re-election of Director, Mr Ribson Gabonowe
To consider and if thought fit, pass the following resolution as an ordinary
resolution:
"That in accordance with the Constitution of the Company, Mr Ribson Gabonowe who
retires by rotation and being eligible, be re-elected as a Director of Discovery
Metals Limited."
3. Re-election of Director, Mr Jeremy Read
To consider and if thought fit, pass the following resolution as an ordinary
resolution:
"That in accordance with the Constitution of the Company,Mr Jeremy Read who
retires by rotation and being eligible, be re-elected as a Director of Discovery
Metals Limited."
4. Approval of Performance Rights Plan
To consider and if thought fit, pass the following resolution as an ordinary
resolution:
"That for the purposes of Listing Rule 7.2, Exception 9 (b) and sections 200B
and 200E of the Corporations Act and for all other purposes:
(a) the terms and conditions of the Discovery Metals Limited Performance Rights
Plan (Performance Rights Plan or Plan), a summary of which is set out in the
Explanatory Memorandum; and
(b) the giving of termination benefits under the Performance Rights Plan by the
Company to a person or their associates in connection with that person ceasing
to hold a managerial or executive office role in the Company or a related body
corporate of the Company as set out in the Explanatory Memorandum,
be approved."
Voting exclusion: In accordance with the ASX Listing Rules and the Corporations
Act, the Company will disregard any votes cast on this Resolution 4 by:
· a Director and shareholders who are also managerial or executive officers of
the Company and are proposed participants in the Performance Rights Plan; and
· any of their associates.
However, the Company will not disregard any votes cast on this Resolution if:
· it is cast by a person excluded from voting as proxy for a person who is
entitled to vote, in accordance with the directions on the proxy form; or
· it is cast by the 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.
5. Issue of Performance Rights to Managing Director, Mr Stuart Bradley Sampson
To consider and if thought fit, pass the following Resolution as an ordinary
resolution:
"That for the purposes of Listing Rule 10.14 and for all other purposes,
approval is given for the issue to Mr Stuart Bradley Sampson of a maximum of
500,000 performance rights under the Performance Rights Plan on the terms set
out in the Explanatory Memorandum."
Note: If approval is obtained under Listing Rule 10.14, approval is not required
under Listing Rule 7.1.
Voting exclusion: The Company will disregard any votes cast on this Resolution
5 by:
· Mr Stuart Bradley Sampson; and
· any associate of Mr Stuart Bradley Sampson (or those persons).
However, the Company will not disregard any votes cast on this Resolution if:
· it is cast by a person excluded from voting as proxy for a person who is
entitled to vote, in accordance with the directions on the proxy form; or
· it is cast by the 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
6. Approval of increase in non-executive Directors' fee pool
To consider and if thought fit, pass the following resolution as an ordinary
resolution:
"That for the purposes of Listing Rule 10.17 and the Company's constitution, the
maximum aggregate remuneration payable out of the funds of the Company to non-
executive Directors of the Company for their services as Directors be increased
by $150,000 from $450,000 to $600,000 per annum to be allocated as determined by
the Board."
Voting exclusion: The Company will disregard any votes cast on this Resolution
6 by:
· the Directors; and
· any associate of the Directors (or those persons).
However, the Company will not disregard any votes cast on this Resolution if:
· it is cast by a person excluded from voting as proxy for a person who is
entitled to vote, in accordance with the directions on the proxy form; or
· it is cast by the 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.
Please refer to the Explanatory Memorandum attached to this Notice of Meeting
for more information regarding the above Resolutions.
Attendance and voting at the meeting
Voting entitlement
In accordance with regulation 7.11.37 of the Corporations Regulations 2001
(Cth), the Board has determined that the Shareholders who are on the Company's
share register at 7:00 pm (Sydney time) / 6:00 pm (Brisbane time) on Sunday, 20
November 2011 will be taken, for the purposes of the Annual General Meeting, to
be entitled to attend and vote at the meeting.
If you are not the registered holder of a relevant share at that time, you will
not be entitled to vote at the meeting.
Voting at the meeting
Ordinary resolutions require the support of more than 50% of the votes cast.
Special resolutions require the support of at least 75% of the votes cast. Every
question arising at this Annual General Meeting will be decided in the first
instance by a show of hands. A poll may be demanded in accordance with the
Company's constitution. On a show of hands, every Shareholder who is present in
person or by proxy, representative or attorney, will have one vote.
Upon a poll, every person who is present in person or by proxy, representative
or attorney, will have one vote for each share held by that person.
Proxies
A Shareholder who is entitled to attend and vote at the meeting may appoint a
person, who need not be a Shareholder of the Company, as the Shareholder's proxy
to attend and vote on behalf of the Shareholder.
A Shareholder who is entitled to cast 2 or more votes may appoint 2 proxies and
may specify the proportion or number of votes each proxy is appointed to
exercise.
A proxy form accompanies this Notice of Meeting. Should you wish to appoint a
proxy, please complete the proxy form and return it at least 48 hours before the
meeting, being no later than 11am (Brisbane time) on 20 November 2011:
· fax to the Share Registry of Discovery Metals Limited, Computershare Investor
Services Pty Limited on 1800 783 447 (within Australia) or + 61 3 9473 2555
(outside Australia); or
· online by visiting www.investorvote.com.au and logging in using the control
number found on the front of your accompanying proxy form. Intermediary Online
subscribers (Institutions/Custodians) may lodge their proxy instruction online
by visiting www.intermediaryonline.com.
If the appointment is signed by an attorney, the power of attorney or a
certified copy of it must be sent with the proxy form.
Undirected proxies - Chairman
Any undirected proxies held by the Chairman of the meeting will not be voted on
Resolution 1. The Chairman of the meeting intends to vote any undirected proxies
for Resolutions 2 to 6, in favour of each of those Resolutions.
Undirected proxies - Directors and 'Key management personnel'
Any undirected proxies held by the Directors (other than the Chairman) or other
'key management personnel' or any of their closely related parties will not be
voted on Resolutions 1, 4, 5 or 6.'Key management personnel' of the Company are
the Directors of the Company and those other persons having authority and
responsibility for planning, directing and controlling the activities of the
Company, directly or indirectly.
If you choose to appoint a proxy, you are encouraged to direct your proxy how to
vote on each Resolution by marking either For, Against or Abstain on the voting
form for that item of business.
By order of the Board
Gregory Seeto
Company Secretary
14 October 2011
Explanatory memorandum
Important notice
This Explanatory Memorandum contains an explanation of, and information about,
the Resolutions to be considered at the Annual General Meeting. Shareholders
should read this Explanatory Memorandum in full. This Explanatory Memorandum
forms part of the accompanying Notice of Meeting and should be read with the
Notice of Meeting.
If you are in doubt about what to do in relation to the proposals, you should
consult your financial or other professional adviser.
Words or expressions used in the Notice of Meeting and in this Explanatory
Memorandum are defined in the Glossary. Unless otherwise stated, all references
to sums of money, '$' and 'dollars' are references to Australian currency.
This Explanatory Memorandum is dated 14 October 2011.
Receipt of financial statements and reports
This item does not require voting by Shareholders. It is intended to provide an
opportunity for Shareholders to raise questions on the financial statements and
reports. The auditor of the Company will be present at the meeting and available
to answer any questions.
Background to the resolutions
Resolution 1 - Adoption of remuneration report (non-binding resolution)
Background
The remuneration report of the Company for the financial year ended 30 June
2011 is set out in the Directors' Report on page 20 of the Annual Report, and
which is available electronically at
http://www.discoverymetals.com/IRM/content/reports_asx.html.
The remuneration report sets out the Company's remuneration arrangements for
Directors, including the Managing Director and key management personnel. A
reasonable opportunity will be provided for discussion of the remuneration
report at the Annual General Meeting.
The Corporations Act requires that a resolution be put to the Shareholders to
adopt the remuneration report. This Resolution is advisory only and does not
bind the Directors or the Company.
The Directors will consider the outcome of the vote and comments made by
Shareholders on the remuneration report at the meeting when reviewing the
Company's remuneration policies.
Two strikes
Under a recent amendment to the Corporations Act (Legislative Amendment), if
25% or more of votes that are cast on this non-binding Resolution are voted
against the adoption of the remuneration report, at two consecutive annual
general meetings, Shareholders will be required to vote at the second of these
annual general meetings on a resolution (a Spill Resolution) that another
meeting be held within 90 days (Spill Meeting), at which:
(a) all of the Company's Directors (other than the Managing Director) cease to
hold office immediately before the end of the Spill Meeting; and
(b) resolutions to appoint persons to offices that will be vacated immediately
before the end of the Spill Meeting will be put to the vote at the Spill
Meeting.
The policy behind this Legislative Amendment is to provide an additional level
of accountability for directors and increased transparency for shareholders. If
a company receives significant "no" votes on its remuneration report over two
consecutive years, and has not adequately addressed concerns raised by
shareholders, it is thought appropriate for the board to be held accountable
through the re-election process.
The Legislative Amendment is intended to strengthen the non-binding vote and to
maintain the fundamental principle underlying Australia's corporate governance
framework that directors are responsible for, and accountable to, shareholders
on all aspects of the management of the company, including the amount and
composition of executive remuneration.
Board Recommendation
The Board unanimously recommends that Shareholders vote FOR Resolution 1.
Resolution 2 - Re-election of Director, Mr Ribson Gabonowe
Background
Under Listing Rule 14.4 and the Company's constitution, a Director must not hold
office without re-election past the third annual general meeting following the
Director's appointment, or 3 years, whichever is longer.
A Director who retires in accordance with these requirements is eligible for re-
election.
Accordingly, Mr Ribson Gabonowe is due to retire at the end of the meeting and
offers himself for re-election to the Board. Details of Mr Gabonowe's
qualifications, experience, other directorships and special responsibilities are
set in the Directors' Report on page 20 of the Annual Report.
Mr Gabonowe is a mining engineer with over 25 years of experience in the mining
industry. For 12 years to December 2006, Mr Gabonowe was the Director of Mines
of Botswana, responsible for administering the legal and fiscal framework
governing mineral exploitation. In this role, Mr Gabonowe was involved in
negotiations of mineral agreements for copper, nickel, diamonds, coal and soda
ash.
Board Recommendation
The Board (with Mr Gabonowe abstaining) recommends that Shareholders vote FOR
Resolution 2.
Resolution 3 - Re-election of Director, Mr Jeremy Read
Background
Under Listing Rule 14.4 and the Company's constitution, a director must not hold
office without re-election past the third annual general meeting following the
Director's appointment, or 3 years, whichever is longer. A Director who retires
in accordance with these requirements is eligible for re-election.
Accordingly, Mr Jeremy Read is due to retire at the end of the meeting and
offers himself for re-election to the Board. Details of Mr Jeremy Read's
qualifications, experience, other directorships and special responsibilities are
set in the Directors' Report on page 20 of the Annual Report.
Mr Read has 23 years domestic and international minerals exploration experience
and was previously the Manager of BHP's Australian Exploration Team. Mr Read has
extensive exploration experience for nickel and copper sulphides and played a
critical role in the discovery of Kabanga North Nickel Deposit in Tanzania. Mr
Read was the founding Managing Director of Discovery Metals from its
incorporation in May 2003, until his appointment as a nonexecutive Director on
1 February 2008.
Mr Read secured the Boseto copper project for the Company and was responsible
for all the Company's fund raising activities up until his appointment as a non-
executive Director and for listing Discovery Metals on the Australian Securities
Exchange, Botswana Stock Exchange and the Alternative Investment Market in
London. He is also the founding Managing Director of Meridian Minerals Limited.
Board Recommendation
The Board (with Mr Read abstaining) recommends that Shareholders vote FOR
Resolution 3.
Resolution 4 - Approval of Performance Rights Plan
Background
Listing Rule 7.1 restricts the number of securities a listed entity can issue
without shareholder approval. Listing Rule 7.2 provides a number of exceptions
to Listing Rule 7.1. Listing Rule 7.2, Exception 9(b) provides that Listing Rule
7.1 does not apply to an issue of securities under an employee incentive scheme
if within 3 years before the date of issue, holders of ordinary securities have
approved the issue of securities under the scheme as an exception to Listing
Rule 7.1.
Resolution 4 seeks Shareholder approval of the:
(a) terms and conditions of the Performance Rights Plan, for the purposes of
Listing Rule 7.2, Exception 9(b) (pre-approval by Shareholders); and
b) the giving of termination benefits under the Performance Rights Plan by the
Company to a person or their associates in connection with that person ceasing
to hold a managerial or executive office role in the Company or a related body
corporate of the Company, if the Board exercises its discretion to allow the
vesting of Performance Rights in those circumstances.
The Performance Rights Plan is an equity linked incentive plan established to
more closely align rewards for performance of key executive management employees
with the achievement of the Company's growth and strategic objectives for the
2012 financial year and beyond.
The Performance Rights Plan will provide for the issue of Performance Rights
which, upon a determination by the Board that the performance conditions have
been met and subject to the terms of the Plan, result in the 'Eligible
Participant' (defined below) being awarded with fully paid ordinary shares.
The Company's existing employee share plan (the Discovery Metals Limited
Employee Share Plan) will continue to be used in appropriate circumstances at
the Board's discretion, for nonexecutive staff.
Performance linked equity plans are widely considered to be a very effective
means of providing incentives to attract and retain staff while aligning
potential incentive outcomes with the interests of shareholders.
The Board believes that the grant of Performance Rights under the Performance
Rights Plan to Eligible Participants, will underpin the employment strategy of
attracting and retaining high calibre staff capable of executing the Company's
strategic plans, and will:
(a) assist the retention of key management and operational staff;
(b) enhance the Company's ability to attract quality staff in the future;
(c) link the rewards of key staff with the achievement of strategic goals and
the long term performance objectives of the Company; and
(d) provide incentives to Eligible Participants of the Performance Rights Plan
to deliver superior performance that creates Shareholder value.
Summary of the features of the Performance Rights Plan
The following is a summary of the key terms and conditions of the Performance
Rights Plan:
1. Participation: The Performance Rights Plan will be available to 'Eligible
Participants' (defined below) of the Company and its subsidiaries (collectively,
the "Group" and each a "Group Member"). Eligible Participants will be full and
part-time employees of a Group Member. It is the Board's intention that the
initial Eligible Participants in the Performance Rights Plan will be the
Managing Director, the general managers and senior managers within the Group.
2. Limit on the maximum number of Performance Rights issuable: An invitation to
apply for Performance Rights will not be made where the grant of Performance
Rights contemplated by the invitation would result in the Company exceeding the
limit that applies under ASIC Class Order 03/184 or any subsequent or
replacement class order in respect of new issues of securities under employee
share schemes.
The limit that currently applies under Class Order 03/184 is equal to 5% of the
issued capital of the Company.
3. Exercise Price: The Performance Rights granted under the Performance Rights
Plan will be granted at no cost to the Eligible Participants.
Within 10 Business Days after a Performance Right under the Performance Rights
Plan has vested (i.e. the vesting conditions linked to those Performance Rights
have been satisfied), the Company will normally award the Eligible Participant
the number of Shares applicable to those Performance Rights free of charge.
4. Shares: Each Performance Right will entitle the Eligible Participant to
receive one fully paid ordinary share in the Company, if the vesting conditions
relating to that Performance Right are satisfied (as noted below under points 8
and 9).
5. Lapse: Unless the Board determines otherwise in its absolute discretion, an
unvested Performance Right will lapse upon the earliest to occur of (among other
circumstances):
(a) the Eligible Participant ceasing to be an Eligible Employee (other than for
ill health or death, if the Board determines within 3 months of the relevant
event, that the Performance Rights will still vest);
(b) the Eligible Participant acting fraudulently or dishonestly or in breach of
the Eligible Participant's obligations to any Group Member;
(c) a resolution being passed or order being made to wind up the Company;
(d) the occurrence of a 'Change of Control' (as that term is defined under the
Plan) (unless the Board has resolved in its absolute discretion that some or all
of the unvested Performance Rights automatically vest); and
(e) the Vesting Conditions in respect of a Performance Right not being met
within any applicable period.
6. Assignability: Performance Rights are not transferable, except with the prior
written consent of the Board, which may be withheld in its absolute discretion.
Performance Rights are transferable to the extent necessary to allow exercise by
personal representatives pursuant to the Plan in the event of the death of the
holder.
7. Amendments: Subject to the Listing Rules, the Board may from time to time
amend or add to all or any of the provisions of the Plan, or the terms or
conditions of any Performance Right granted under the Plan, including vesting
conditions.
8. Vesting: Vesting conditions will be determined by the Board at the time an
invitation, inviting Eligible Participants to participate in the Performance
Rights Plan is made. Performance Rights will not vest until the relevant vesting
conditions linked to those Performance Rights have been satisfied, unless the
vesting conditions are waived by the Board in its absolute discretion.
9. Structure of Performance Rights Award: The award of Performance Rights will
be comprised as follows:
· 1/3 of the Eligible Participant's Performance Rights will be a Service
Component; and
· 2/3 of the Eligible Participant's Performance Rights will be a Performance
Component.
The Service Component
(a) The Service Component of the Eligible Participant's Performance Rights is
subject only to the Eligible Participant's continued good service with the
Company (or a subsidiary) to the Board's satisfaction (Service Condition).
The Performance Component
(b) The number of Performance Rights that may be awarded from the Performance
Component is subject to:
· organisational performance - relative total shareholder return (TSR) test; and
· individual performance - assessed against the Eligible Participant's
individual performance (STI Rating).
Organisational performance
The relative TSR performance test is applied as follows:
(c) The TSR test will be measured against the performance of a peer group
comprising of between 6 and 10 resource companies in the year of award
(Organisational Performance Component).
(d) The quantum of the Eligible Participant's Performance Component that will be
awarded under the Organisational Performance Component as a result of the TSR
test is set out in the following table:
DML's relative
+-------------------------------------+----------------------------------------+
|DML's relative TSR performance |Organisational Performance Component |
+-------------------------------------+----------------------------------------+
|Below 25(th) percentile TSR |Zero |
+-------------------------------------+----------------------------------------+
|Above 75(th) percentile TSR |100% |
+-------------------------------------+----------------------------------------+
|25(th) percentile - 75(th) percentile|Straight line increase in vesting |
|TSR |between 25% and 100% |
+-------------------------------------+----------------------------------------+
Individual performance
(e) The final number of Performance Rights that will be awarded will depend upon
the Eligible Participant's performance against their individual KPIs (STI
Rating) as set out below (Awarded Performance Component):
+------------+----------------------------------------------------------------+
| STI Rating | Awarded Performance Component |
+------------+----------------------------------------------------------------+
| Below 25% | Zero |
+------------+----------------------------------------------------------------+
| Above 75% | 100% of Organisational Performance Component |
+------------+----------------------------------------------------------------+
| 25% - 75% | An amount calculated as: |
| | |
| | APC = OPC * ((STI Rating - 25%) / (75%-25%)) |
| | |
| | where: |
| | |
| | APC is the Awarded Performance Component |
| | |
| | OPC is the Organisational Performance Component |
| | |
| | STI Rating is the Eligible Participant's individual STI Rating |
+------------+----------------------------------------------------------------+
STI Rating Awarded Performance Component
10. Vesting of Performance Rights awarded:
(a) The Performance Rights awarded as described above will vest annually in 3
equal tranches.
(b) The Eligible Participant must continue to meet the Service Condition at the
time a tranche of their awarded Performance Rights is due to vest to be entitled
to receive that tranche.
11. Worked example:
The following is assumed in this worked example:
>> The Company's relative TSR is in the 70th percentile of its peer group;
>> The Eligible Participant's STI rating is 65%;
>> The Eligible Participant's maximum Performance Rights entitlement as
determined by the Board is 100,000.
Accordingly:
>> The maximum number of Performance Rights that may be awarded comprises:
· 33,333 for the Service Component; and
· 66,667 for the Performance Component.
>> Based on a TSR of 70%, the Organisational Performance Component will be:
(70-25)÷(75-25) x 100 = 90%
>> Based on a STI Rating of 65%, the Eligible Participant's Performance
Component will be:
(65-25)÷(75-25) x 100 = 80%
>> This would in turn make the percentage of the Performance Component awarded:
= Organisational Performance Component x Eligible Participant's Performance
Component
= 90% x 80%
= 72%
and accordingly, the Awarded Performance Component would be:
72% x 66,667 = 48,000 Performance Rights
Accordingly, the awarded Service Component and awarded Performance Component of
the Performance Rights would vest as follows:
Year 1 Vesting Year 2 Vesting Year 3 Vesting Total Award
Year 1 Vesting Year 2 Vesting Year 3 Vesting Total Award
=------------------------------------------------------------------------------
Awarded Service 11,111 11,111 11,111 33,333
Component
Awarded Performance 16,000 16,000 16,000 48,000
Component
=------------------------------------------------------------------------------
Total 27,111 27,111 27,111 81,333
The requirement for Shareholder approval
The Board is seeking Shareholder approval to the terms of its Performance Rights
Plan under ASX Listing Rule 7.2, Exception 9(b) and for the purposes of sections
200B and 200E of the Corporations Act.
Shareholder approval pursuant to ASX Listing Rule 7.2, Exception 9(b)
Shareholder approval of the Performance Rights Plan in accordance with ASX
Listing Rule 7.2, Exception 9(b) will exempt grants under the Performance Rights
Plan from the calculation of the 15% annual limit on the grant of new securities
without prior Shareholder approval, for a period of three years from the date of
the passing of this Resolution.
In the absence of approval under ASX Listing Rule 7.2, Exception 9(b), grants
under the Performance Rights Plan can still occur but are counted as part of the
15% limit which would otherwise apply during a 12 month period.
For the purposes of obtaining approval under ASX Listing Rule 7.2, Exception
9(b), the Company confirms that:
(a) as at the date of this Explanatory Memorandum, the Company had not made any
issues of Performance Rights under the Performance Rights Plan;
(b) a summary of the terms of the Performance Rights Plan is set out above; and
(c) the resolution includes a voting exclusion statement.
Based on the current organisation structure, the total awards under the
Performance Rights Plan are expected to be in the range of 1.5 to 2 million
shares per year, which is less than 0.5 per cent of the issued capital of the
Company.
Shareholder approval pursuant to sections 200B and 200E of the Corporations Act
The Corporations Act restricts the benefits which can be given to certain
persons (those who hold a managerial or executive office, as defined in the
Corporations Act) on leaving their employment with the Group. Under Section
200B of the Corporations Act, a company may only give a person a benefit in
connection with their ceasing to hold a managerial or executive office in the
Group if it is approved by shareholders or an exemption applies.
Under the termination benefits laws, the term "benefit" has a wide operation,
and will include benefits arising from the Board exercising its discretion under
the rules of the Performance Rights Plan to vest unvested Performance Rights on
cessation of employment due to ill health or death or if there is a change of
control of the Company.
The Company is seeking shareholder approval for the purposes of sections 200B
and 200E of the Corporations Act to any "termination benefits" that the Group
provides to an Eligible Participant under the Performance Rights Plan.
Specifically, Shareholder approval is being sought to give the Board the
capacity to exercise certain discretions under the Performance Rights Plan,
including the discretion to determine to vest some or all of the Performance
Rights of an Eligible Participant who would ordinarily trigger the new
termination benefits laws when they leave employment with the Group.
Approval is being sought in respect of any current or future Eligible
Participant who holds:
(a) a managerial or executive office in the Group at the time of their leaving;
and
(b) Performance Rights issued under the Performance Rights Plan at the time of
their leaving.
The Company is seeking this approval to provide the Group with the flexibility
to continue to remunerate employees fairly and responsibly in the future, and in
a manner that appropriately drives long term performance for Shareholders. The
Board believes that it is appropriate that there is flexibility to deal with the
vesting of Performance Rights issued under the Performance Rights Plan, as
cessation of managerial or executive office can occur for a variety of reasons.
If Shareholder approval is obtained and the Board exercises its discretion to
vest some or all of an affected Eligible Participant's unvested Performance
Rights, the value of the benefit (i.e. those invested Performance Rights) will
be disregarded when calculating the permissible termination benefits payable to
that person under the Corporations Act without further Shareholder approval.
Disclosures pursuant to section 200E of the Corporations Act
Section 200E requires the following information be provided to Shareholders in
approving a termination benefit.
(a) Explanation of the termination benefits
The Performance Rights Plan contains provisions setting out the treatment of
unvested Performance Rights including the vesting of those Performance Rights
subject to the discretion of the Board in the event of cessation of employment
due to ill health or death or a change of control. As noted above, the exercise
of these discretions by the Board will constitute a "benefit" for the purposes
of the Corporations Act's termination benefits provisions.
(b) Value of the termination benefits
Various matters will or are likely to affect that value of the termination
benefits that the Board may give under the Performance Rights Plan, on this
basis the value of the termination benefits cannot be determined in advance.
The value of a particular benefit resulting from the exercise of the Board's
discretion under the Performance Rights Plan will depend on factors such as the
Company's share price at the time of vesting and the number of Performance
Rights that the Board decides to vest.
Some of the factors that may affect the value of the termination benefits are as
follows:
(a) the Eligible Participant's total fixed remuneration at the time grants are
made under the Performance Rights Plan and at the time they cease employment;
(b) the Eligible Participant's length of service and the portion of any relevant
vesting conditions that have been satisfied at the time they cease employment;
and
(c) the number of unvested Performance Rights that the Eligible Participant
holds at the time they cease employment.
Board Recommendation
The Board unanimously recommends that Shareholders vote FOR Resolution 4.
Resolution 5 - Issue of Performance Rights to Managing Director, Mr Stuart
Bradley Sampson
Background
Resolution 5 seeks Shareholder approval under Listing Rule 10.14 to approve the
grant of a maximum of 500,000 Performance Rights to Mr Stuart Bradley Sampson,
the Managing Director of the Company, pursuant to the Performance Rights Plan
and otherwise on the terms and conditions set out in this Notice of Meeting and
Explanatory Memorandum.
The total number of Shares to which Mr Sampson will ultimately become entitled
will be determined by the method as set out above in the Explanatory Memorandum
to Resolution 4. Shareholder approval to the proposed issue of a maximum of
500,000 Performance Rights to Mr Sampson is required under ASX Listing Rule
10.14 because Mr Sampson is a Director of the Company.
The Board believes that the grant of Performance Rights to Mr Sampson will
provide Mr Sampson with incentive to achieve the long term performance
objectives of the Company by aligning the delivery of specific milestones and
Shareholder return objectives with Mr Sampson's potential to receive incentive
based share ownership in the Company. The Performance Rights to be granted to Mr
Sampson are subject to the terms and conditions of the Plan and are 'at risk'
until the vesting conditions are met.
If the Shareholders do not approve Resolution 5, the Company cannot grant
Performance Rights to Mr Sampson. If the Board proposes to make a new award of
Performance Rights to Mr Sampson in any subsequent year, the Company will seek
Shareholder approval to that further award.
Notice of meeting requirements under Listing Rule 10.15
Listing Rule 10.14 provides that a company must not permit a director of the
company or an associate of the director to acquire securities under an employee
incentive scheme without the company obtaining the approval of its Shareholders.
If Shareholder approval is given under Listing Rule 10.14, approval is not
required under Listing Rule 7.1. In accordance with Listing Rule 10.15 and in
addition to the summary of the Performance Rights Plan included under Resolution
4:
(1) Mr Stuart Bradley Sampson is the Managing Director of the Company;
(2) the maximum number of securities that may be acquired by Mr Sampson (being
the only person for whom approval under Listing Rule 10.14 is required at this
time) is 500,000;
(3) No consideration is payable by Mr Sampson at the time of issue of the Rights
or at the time of vesting of those Rights into Shares. The closing price of the
Shares the trading day before the date of this document was $1.41. The value of
the Shares issued to Mr Sampson once the Performance Rights have vested will be
the current market value of the Shares at the time those Performance Rights vest
and the Shares are issued. The market value of the Shares on the date that they
are actually issued, or on the date that the vesting conditions are satisfied,
may be higher or lower than the closing price noted above;
(4) no persons have yet received performance rights under the Performance Rights
Plan;
(5) Only 'Eligible Participants' (as that term is defined under Resolution 4,
point 1 above) are entitled to participate in the Performance Rights Plan. Mr
Sampson has been determined to be an Eligible Participant for the purposes of
the Performance Rights Plan;
(6) a voting exclusion statement has been included in the Notice of Meeting;
(7) no loans will be used in relation to the acquisition of the Rights by Mr
Sampson; and
(8) the Company will issue the Performance Rights to Mr Sampson as soon as
practicable after Shareholder approval has been obtained and in any event no
later than 12 months after the meeting.
Notice of meeting requirements under Corporations Act
As noted above, Shareholder approval is required under Listing Rule 10.14 for
the issue of Performance Rights to Mr Sampson as he is a Director and therefore
a related party of the Company. The Board has considered the application of
Chapter 2E of the Corporations Act (related party provisions) and has resolved
that the reasonable remuneration exception provided by section 211 of the
Corporations Act is relevant in the circumstances and accordingly, the Company
will not also seek approval for the issue of Performance Rights to Mr Sampson
under the Performance Rights Plan, pursuant to section 208 of the Corporations
Act.
Board Recommendation
The Board (with Mr Sampson abstaining) recommends that Shareholders vote FOR
Resolution 5.
Resolution 6 - Approval of increase in non-executive Directors' fee pool
Listing Rule 10.17 provides that the maximum aggregate amount of the
remuneration payable as Directors' fees be determined by Shareholders at a
general meeting.
Shareholders last voted to increase the fee pool to $450,000 in November 2008.
Further, when Shareholders approved the Discovery Metals Limited Employee and
Director Share Plan in February 2010, non-executive Directors' fees were locked
at the 2008 levels until the Boseto copper project became operational.
As this milestone will occur in the first half of 2012, the board accordingly
believes that it should revert to market based nonexecutive Directors' fees from
1 July 2012.
The Board seeks approval for the maximum remuneration pool available for non-
executive Directors to be increased by $150,000 to $600,000 per annum.
This increase also allows for fees for additional Directors, which will become a
consideration as the Company progresses the construction of the Boseto mine and
the development of its projects.
Board Recommendation
The Board abstains from making a recommendation in respect of Resolution 6.
Glossary
In this Explanatory Memorandum and the Notice of Meeting:
Annual General Meeting means the annual general meeting of the Company to be
convened by the Notice of Meeting;
ASX means ASX Limited ACN 008 624 691;
Board means the board of Directors of the Company;
Chairman means the chairman of the Board;
Company means Discovery Metals Limited ACN 104 924 423;
Constitution means the constitution of the Company currently in force;
Corporations Act means the Corporations Act 2001 (Cth);
Directors means the Directors of the Company as at the date of this Explanatory
Memorandum being Gordon Galt, Morrice Cordiner, John Shaw, Ribson Gabonowe,
Jeremy Read and
Stuart Bradley Sampson;
Explanatory Memorandum means this explanatory memorandum that accompanies and
forms part of the Notice of Meeting;
Listing Rules means the Official Listing Rules of ASX;
Notice of Meeting means the notice of annual general meeting dated 14 October
2011 which this Explanatory Memorandum accompanies and in which the Resolutions
are set out;
Resolution means the resolutions referred to in the Notice of Meeting;
Rights or Performance Rights means a right to be awarded as a specified number
of Shares upon satisfaction of vesting conditions determined by the Board in
accordance with the Performance Rights Plan;
Share means a fully paid ordinary share in the Company; and
Shareholder means a holder of Shares.
Discovery Metas Limited: Notice of Annual General Meeting/Proxy Form:
http://hugin.info/137928/R/1554861/479401.pdf
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Discovery Metals Limited via Thomson Reuters ONE
[HUG#1554861]
Discov. Met (LSE:DME)
Gráfica de Acción Histórica
De May 2024 a Jun 2024
Discov. Met (LSE:DME)
Gráfica de Acción Histórica
De Jun 2023 a Jun 2024
