Following Consolidated Zinc Limited’s (CZL or Company) recent announcement of its transition to a zinc producer, the Company is now pleased to offer eligible shareholders an opportunity to share in the ongoing progress of your Company by subscribing for up to $15,000 in new CZL shares, with no brokerage costs, through a Share Purchase Plan (SPP).
This SPP allows eligible shareholders to acquire additional shares in the Company at a price of 2.4 cents per share. The SPP will be available to all eligible shareholders and is expected to raise $1.5m.
The issue of shares under the SPP will be limited to 62,500,000 new fully paid ordinary shares (6.76% of the issued capital of the Company) and will not be underwritten, subject to final discretion of the Board. In the event of oversubscriptions, the Company may (at its discretion) scale-back applications pro-rata basis based on the size of the applicant’s existing shareholding as at the Record Date.
The Officers and Directors of the Company may take up all or part of their allocation under the SPP.
The Company announced its transition to a zinc producer on 5 September 2018. Mining has commenced at our Plomosas mine with plans to ramp up production from 2,500 to 10,000 tonnes per month. The Company has signed a processing and offtake agreement with Grupo Mexico to process the ore through their nearby Santa Eulalia concentrator with the Plomosas concentrate sold and delivered to Grupo Mexico’s San Luis Potosi smelter.
CZL has elected to proceed with processing the Plomosas ore through the Santa Eulalia plant as it will accelerate the delivery of production, provides comparable returns from the beneficiation of the Plomosas high-grade mineralisation on site and minimises initial capital requirements. The Company is confident that the first cashflow can be achieved in October for a capital cost less than US$500,000 and the C3 operating costs are expected to be less than US$0.50/lb Zinc after by-product credits averaged over the first year of production.
The CZL Board intends to exercise the Company’s rights under the Shareholders Agreement, to purchase our JV partner’s 39% equity in the operating company, Minera Latin America Zinc (MLAZ), for A$750,000 and shares to the value of A$1.7 million, increasing CZL’s interest from 51% to 90%.
If suitable terms can be negotiated CZL intends to acquire the remaining 10% of MLAZ.
Funds raised from the SPP will be used to fund the purchase of the additional equity in MLAZ and for general working capital. The SPP provides an opportunity to existing shareholders to increase their holdings and participate in this exciting growth stage for CZL.
The Offer
The SPP is offered exclusively to all shareholders who are recorded on the Company’s share register at 5pm (AEST) on 24 September 2018 (Record Date) and whose registered address is in Australia and New Zealand.
It provides shareholders with an opportunity to buy a parcel of new shares in the Company with no brokerage or commission costs, irrespective of the size of their shareholding, up to a maximum value of $15,000.
The issue price of each share under the SPP is $0.024 which represents an 11.1% discount to the closing price on 24 September, 2018 of the Company’s shares traded on the ASX before the date of announcement of the SPP. The market price of shares in the Company may rise or fall between the date of this offer and the date that new shares are issued to you under the SPP.
Participation in the SPP is optional and the right to participate is not transferable. The offer to participate in the SPP closes at 5.00pm (AEST) on 17 October 2018.
Full details on the SPP and how to participate are contained in the documents attached. To apply for a parcel of shares please read these documents carefully and follow the instructions on the enclosed personalised application form.
Your continuing support as a shareholder of Consolidated Zinc Limited is appreciated.
Yours sincerely,
ABOUT CONSOLIDATED ZINC
Consolidated Zinc Limited (ASX:CZL) is a minerals exploration company listed on the Australian Securities Exchange. The Company’s major focus is in Mexico where it acquired 51% of the exciting high grade Plomosas Zinc Lead Silver Project in June 2015 with the option of increasing to 90% through its majority owned subsidiary, Minera Latin American Zinc CV SAPI.
Historical mining at Plomosas between 1945 and 1974 extracted over 2 million tonnes of ore grading 22% Zn+Pb and over 80g/t Ag. Only small scale mining continued to the present day and the mineralised zones remain open at depth and along strike. The Company’s main focus is to identify and explore new zones of mineralisation within and adjacent to the known mineralisation at Plomosas with a view to identifying new mineral resources that are exploitable.
Original Article: http://www.consolidatedzinc.com.au/wp-content/uploads/2018/09/250918-Share-Purchase-Plan.pdf
