1.1 Transaction Agreements
(a) Shareholders Agreement
On 7 December 2007 the Company entered into a Shareholders
Agreement in respect of a company to be incorporated in the Republic of
Congo (“Congolese Company”) which will legally and beneficially hold the
Mayoko Iron Ore licence.
4
NW46380
Following incorporation of the Congolese Company the issued capital of
the Congolese Company shall be as follows:
Percentage Held by
Each Member
DMC 80%
Tanaka and/or nominee 3%
PMI and/or nominee 7%
Mounda Mongha Makosso and/or nominee 10%
Mounda Mongha Makosso is a Congolese national.
DMC shall remain as the majority on the board of directors of the
Congolese Company.
(b) Facilitation Agreement
The Company also entered into a Facilitation Agreement with Tanaka and
PMI for services in connection with assistance and facilitation of the
acquisition of the Mayoko Iron Ore Project. Pursuant to the Facilitation
Agreement the Company agreed to issue to Tanaka and PMI Shares in
consideration for their services in connection with the acquisition of the
Mayoko Iron Ore licence. The issue of the Shares to Tanaka and PMI
pursuant to the Facilitation Agreement is conditional upon Shareholders
approving their issue in a general meeting. Accordingly Resolutions 1, 2
and 3 serve to obtain such approval.
1.2 Pro Forma Capital Structure
Upon the passing of the Resolutions contained in this Explanatory Statement the
Companies capital structure will be as follows:
Shares
Currently issued shares* 26,650,833
Resolution 1 3,333,333
Resolution 2 4,250,000
Resolution 3 4,250,000
Resolution 4 1,500,000
Resolution 9 20,000,000
Total 59,984,166
Options
Currently issued options 13,224,167
Resolution 5 1,000,000
Resolution 6 1,000,000
Resolution 7 1,000,000
Resolution 8 11,000,000
Total 27,224,167
*for the purposes of this table the currently issued capital does not include the
Shares issued pursuant to the Placement.
5
NW46380
2 Resolution 1 – Issue of Shares in Connection with the Acquisition of the
Mayoko Iron Ore Project
Pursuant to the Facilitation Agreement, subject to approval by Existing
Shareholders, the Company agreed to issue 1,000,000 Shares to Tanaka and
2,333,333 Shares to PMI in part consideration for their services in connection
with the acquisition of the Mayoko Iron Ore Project.
Tanaka and PMI (together “the Consultants”) agree that they will not sell or deal
with the Shares the subject of Resolution 1 for the period of one year from the
date of issue of the Shares, except by an off market transfer upon receipt of
written consent of the board of directors of DMC.
Resolution 1 is an ordinary resolution and is subject to and conditional upon the
passing of Resolutions 2 and 3.. The issue of the Shares under Resolution 1 is
to be approved by Existing Shareholders under the requirement of Listing Rule
7.1. The provisions of Listing Rule 7.1 are summarised in section 11.2 of this
Explanatory Statement.