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Publication of Supplementary Explanatory Statement
regarding the General Meeting
Europa Metals Ltd
(Incorporated and registered in Australia and registered as
an external company in the Republic of South Africa)
(Registration number 4459850)
(External company registration number 2011/116305/10)
Share code on the ASX: EUZ
Share code on AIM: EUZ
Share code on the JSE: EUZ
ISIN: AU0000014342
("Europa Metals" or “the Company”)
Publication of Supplementary Explanatory Statement
Europa Metals, the European focused lead-zinc and silver developer, further to the
Company’s announcement of 7 December 2022, wishes to provide additional information
that the directors of the Company consider may be beneficial to Shareholders in deciding
whether to approve the resolution to be proposed at the general meeting scheduled to be
held at 11.00 a.m. (UK time) on Friday, 30 December 2022.
The Supplementary Explanatory Statement is set out in full at the end of this announcement
and should be read by Shareholders in its entirety. In addition, the Supplementary
Explanatory Statement, together with the Explanatory Statement of 7 December 2022, can
be viewed and downloaded from the Company’s website via the following link:
http://www.europametals.com/site/aim-rule-261/shareholder-communication
Defined terms used in this announcement have the same meanings as those ascribed to
them in the Notice, Explanatory Statement and/or Supplementary Explanatory Statement
unless the context requires otherwise.
For further information on the Company, please visit www.europametals.com or contact:
Europa Metals Ltd
Dan Smith, Non-Executive Director and Company Secretary (Australia)
T: +61 417 978 955
Myles Campion, Executive Chairman and acting CEO (UK)
T: +44 (0)20 3289 9923
Strand Hanson Limited (Nominated Adviser)
Rory Murphy/Matthew Chandler
T: +44 (0)20 7409 3494
WH Ireland Limited (Broker)
Harry Ansell/Dan Bristowe/Katy Mitchell/Sarah Mather
T: +44 (0)20 7 220 1666
Questco Corporate Advisory Proprietary Limited (JSE Sponsor)
Sharon Owens
T: +27 (11) 011 9212
EUROPA METALS LTD
ACN 097 532 137
SUPPLEMENTARY EXPLANATORY STATEMENT TO SHAREHOLDERS
INTRODUCTION
This Supplementary Explanatory Statement has been prepared for the information and assistance
of Shareholders in connection with the Resolution to be considered at the General Meeting of the
Company’s Shareholders to be held at 11.00 a.m. (UK time) / 7.00 p.m. (AWST) on Friday, 30
December 2022 at the offices of The Ince Group PLC at Aldgate Tower, 2 Leman Street, London E1
8QN.
This Supplementary Explanatory Statement should be read in conjunction with the Notice of
Meeting and Explanatory Statement announced and sent to Shareholders on 7 December
2022.
Capitalised terms in this Supplementary Explanatory Statement have the meanings given in the
Notice of General Meeting and Explanatory Statement to Shareholders unless otherwise stated.
The purpose of this Supplementary Explanatory Statement is to provide certain additional information
that the Directors believe may be beneficial to Shareholders in deciding whether or not to pass the
Resolution set out in the Notice.
1. RESOLUTION 1 - APPROVAL OF THE PROPOSED TRANSACTION WITH DENARIUS
1.1 Denarius
Denarius is a Canadian junior mining company listed on the TSXV (ticker symbol: DSLV). It is
engaged in the acquisition, exploration, development and eventual operation of mining projects
in high-grade districts, with its principal focus being on its Lomero-Poyatos Project (the Lomero
Project) in Spain. Denarius also owns the Zancudo and Guia Antigua Projects in Colombia.
Following appropriate due diligence, the Company is satisfied that Denarius has a suitably
qualified board and management team as well as access to sufficient funds to be able to, inter
alia, properly carry out the planned twin drill programme and complete a preliminary economic
assessment to satisfy the conditions to be able to exercise the First Option, and thereafter
potentially complete a NI 43-101 compliant pre-feasibility study on the Toral Project and pay US$2
million cash to the Company to be able to exercise the Second Option.
1.2 Toral Project
On 30 November 2022, the Company announced an updated mineral resource estimate for the
Toral Project. The Company confirms that there have not been any material changes to the
information set out in that announcement. Further information on the Toral Project is set out in
the announcement and, if Shareholders are in any doubt about its contents, they are
recommended to seek independent advice.
In the event that Shareholders do not approve the Resolution or Denarius withdraws from the
Option Agreement without substantially completing the conditions to the exercise of the First
Option or Second Option, the Company would seek to either identify and secure an alternative
partner(s) to fund the Toral Project or raise sufficient funds to progress the project. Progressing
the Toral Project will include further exploration work and completion of a pre-feasibility study.
1.3 Loan
The proposed Loan to the Company’s wholly-owned subsidiary EMI will be a participating, or
limited recourse, loan governed under Spanish law, which converts into equity in EMI upon
Denarius exercising the First Option.
If the First Option is not exercised, Denarius will be required to assign the Loan to Europa Metals
in return for the payment by the Company of US$1.
Interest of 5 per cent. will accrue on the Loan if EMI generates a profit of at least €500,000 prior
to it being converted into equity.
1.4 JV Agreement and Shareholders’ Agreement
In addition to the terms set out in the Explanatory Statement, the JV Agreement contains the
following terms:
(a) during the option periods, Denarius will, as operator, prepare work programmes and
budgets for approval by the Management Committee. Europa Metals will initially have
one representative on the Management Committee. A participant may elect not to
participate in the work programme and budget, in which event their interest in the joint
venture would be diluted in accordance with an agreed formula;
(b) subject to typical exceptions, in the event that a party wished to transfer its interest in the
JV Agreement, there is a right of first refusal to the other party; and
(c) disputes under the JV Agreement are to be resolved by arbitration.
The JV Agreement and Shareholders’ Agreement otherwise contain terms considered customary
for a transaction of this nature.
1.5 Directors’ recommendation
In unanimously recommending that Shareholders vote in favour of the Resolution, the Directors
have identified and considered the following principal advantages:
(a) prior to entering into the Option Agreement, the Company undertook a lengthy due
diligence and sale/joint venture process, and is satisfied that as a result of this process
the consideration receivable under the Option Agreement is superior to competing
potential proposals received and is at least equal to the value of the interest in the Toral
Project being disposed;
(b) the Option Agreement enables the Toral Project to be advanced by Denarius to a
completed pre-feasibility study stage without the Company having to raise further capital
for Toral;
(c) as a condition to exercising the Second Option, Denarius must pay the Company US$2
million in cash. As a result of such potential future cash payment, the Directors believe
that the Company would be in an optimal position to invest in other resource
opportunities/projects;
(d) Denarius’ management team is experienced in operating in Spain and is currently
advancing Denarius’ Lomero Project towards an economic study following completion of
its Phase 2 exploration programme; and
(e) the Company will, in the event that Denarius at any time elects not to proceed with the
Option Agreement, have the benefit of the work undertaken by Denarius, at no cost to the
Company, to that point.
In unanimously recommending that Shareholders vote in favour of the Resolution, the Directors
have also had regard to the following disadvantages:
(a) the Company will no longer manage the Toral Project and, following exercise of the First
Option and potentially the Second Option, will be a minority shareholder in EMI; and
(b) the Company could potentially suffer further dilution should fundraising activity be
required if it cannot meet future cash calls in respect of the Toral Project.
GLOSSARY IN RESPECT OF THE EXPLANATORY STATEMENT AND SUPPLEMENTARY
EXPLANATORY STATEMENT
A$ means Australian dollars.
AIM means the market of that name operated by the London
Stock Exchange plc.
AIM Rules for Companies means the AIM Rules for Companies published by
London Stock Exchange plc (as amended from time to
time).
Board means the current board of directors of the Company.
Chairman or Chair means the person appointed to chair the General
Meeting.
Company or Europa Metals means Europa Metals Ltd ACN 097 532 137.
Corporations Act means the Corporations Act 2001 (Cth).
Corporations Regulations means the Corporations Regulations 2001 (Cth).
DI Holders means holders of depositary interests in the Company.
Directors means the directors of the Company, being Myles
Campion, Evan Kirby and Daniel Smith.
Explanatory Statement means the explanatory statement accompanying the
Notice of Meeting.
Form of Instruction means, for DI Holders, the form of instruction enclosed
with the Notice of Meeting.
General Meeting or Meeting means the General Meeting of Shareholders convened
by the Notice.
Group means the Company and a related body corporate of the
Company as defined in section 50 of the Corporations Act
and any company in respect of which the Company has
voting power of not less than 20%.
Notice of Meeting or Notice means the notice of General Meeting including the
Explanatory Statement.
Ordinary Resolution means a Resolution to be passed by a simple majority of
Shareholders (entitled to vote) that vote on the Resolution
(in person, by proxy, by attorney or, in the case of a
corporate Shareholder, by a corporate representative).
Proxy Form means, for Shareholders, the proxy form enclosed with
the Notice of Meeting.
Resolution means the resolution set out in the Notice of Meeting.
Share means an ordinary share in the Company.
Shareholder means a holder of Shares in the Company.
US$ means US dollars.
All references to “£”, “pence” or “p” are to the lawful currency of the United Kingdom.
All references to “A$”, “$”, “c” or “cents” are to the lawful currency of Australia.
JSE Sponsor to Europa Metals
Questco Corporate Advisory Proprietary Limited
Sharon Owens
T: +27 (11) 011 9212
United Kingdom
21 December 2022
Date: 21-12-2022 09:00:00
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