Galane Gold Ltd. Announces the Completion of a Transaction With the Phakamani Foundation Trust as Part of Its Empowerment Req...
March 19 2019 - 6:51PM
Galane Gold Ltd. (“Galane Gold” or the “Company”) (TSX-V: GG) is
pleased to announce that it has completed the donation of 17% of
the total issued share capital of Galaxy Gold Mining (Pty) Ltd
(“Galaxy”) to the Phakamani Foundation NPC (“Phakamani”) as part of
its empowerment requirements in South Africa(1)(2).
Phakamani is a development micro-finance
institution that envisages South Africa as a country in which even
the poorest entrepreneur can create a micro-enterprise and build a
dream. Since inception in 2008, the Foundation has issued over
US$32 million in loans to over 96,000 different women. Each client
has been exposed to an integrated program of basic business
training, group loans, and on-going support. Phakamani’s end goal
is to leads its clients towards a liveable income, savings, and
hope for the next generation. Further information on Phakamani and
its activities in South Africa can be found on their website
http://phakamanifoundation.org/.
Mark Tucker, CEO of Phakamani, commented:
“Phakamani cannot do this alone and we are delighted that Galaxy is
partnering with us to enrich the development of the poorest people
in South Africa.”
Galane Gold CEO, Nick Brodie commented: “We are
delighted that Phakamani has agreed to partner with us and believe
its aspirations to empower the poorest people within South Africa
embodies Galaxy’s requirement to empower the historically
disadvantaged.”
In addition to the donation of the Galaxy shares
to Phakamani, Galaxy’s subsidiary Galaxy Gold Reefs (Pty) Ltd
(“GGR” and together with Galaxy, the “Galaxy Companies”) has
donated 5% of its total issued share capital to a community based
trust and 5% to a local employee share scheme(1)(2). With these
three donations, Galaxy has fulfilled its obligations with regards
to Black Economic Empowerment(1)(2)(3).
About Galane Gold
Galane Gold is an un-hedged gold producer and
explorer with mining operations and exploration tenements in
Botswana and South Africa. Galane Gold is a public company and its
shares are quoted on the TSX Venture Exchange and the Botswana
Stock Exchange under the symbol “GG”. Galane Gold’s
management team is comprised of senior mining professionals with
extensive experience in managing mining and processing operations
and large-scale exploration programmes. Galane Gold is
committed to operating at world-class standards and is focused on
the safety of its employees, respecting the environment, and
contributing to the communities in which it operates.
Notes:
- In terms of the Mineral and
Petroleum Resources Development Act, 2004 (“MPRDA”) of the Republic
of South Africa, together with the Broad-Based Socio-Economic
Empowerment Charter for the Mining and Minerals Industry, 2018
(“Mining Charter”), the equity ownership of Galaxy, as the holder
of existing gold mining rights, is required to comprise, directly
or indirectly, of at least a 26% shareholding by historically
disadvantaged persons (“HDPs”). An HDP is defined as any person,
category of persons or community disadvantaged by unfair
discrimination prior to the 1996 Constitution of the Republic of
South Africa coming into effect, and include juristic and
quasi-juristic entities such as companies, trusts, associations or
the like which are directly or indirectly majority owned and
managed by HDPs. In terms of the Mining Charter, HDPs are
effectively limited to South African citizens of African, Coloured
and Indian descent, defined as “Black People” in terms of the
Broad-Based Black Economic Empowerment Act, 2003 and the Codes of
Good Practice promulgated thereunder.
- The financial commitments of the
community development and employee participation trusts to their
respective beneficiaries will initially be supported with loan
funding from the Galaxy Companies, until sufficient dividend income
from the underlying GGR shares is achieved. The Galaxy shares
held by the enterprise development entity are subject to a call
option in favour of its parent company, Mupane Gold Mines Limited,
at a pre-agreed strike price that takes into account any increase
in the enterprise value of Galaxy. The call option is furthermore
annually renewable at an agreed premium which will ensure that such
shareholder receives in cash a minimum annual amount. Dividends
will only become payable by the Galaxy Companies after having
settled all applicable loan funding and external and inter-company
debt.
- As the relevant shares in the
Galaxy Companies will be donated outright to the BEE shareholders,
once the BEE transactions are fully implemented, GGR’s mining
rights should be recognised as achieving an effective 27% debt-free
equity interest (or equity equivalent benefit) in HDPs that
delivers tangible economic benefits to the HDPs and, accordingly,
as fully compliant in these respects with the requirements of the
MPRDA and the Mining Charter.
Cautionary Notes
Certain statements contained in this press
release constitute “forward-looking statements”. All statements
other than statements of historical fact contained in this press
release, including, without limitation, those regarding the
Company’s future financial position and results of operations,
strategy, proposed acquisitions, plans, objectives, goals and
targets, and any statements preceded by, followed by or that
include the words “believe”, “expect”, “aim”, “intend”, “plan”,
“continue”, “will”, “may”, “would”, “anticipate”, “estimate”,
“forecast”, “predict”, “project”, “seek”, “should” or similar
expressions or the negative thereof, are forward-looking
statements. These statements are not historical facts but instead
represent only the Company’s expectations, estimates and
projections regarding future events. These statements are not
guarantees of future performance and involve assumptions, risks and
uncertainties that are difficult to predict. Therefore, actual
results may differ materially from what is expressed, implied or
forecasted in such forward-looking statements.
Additional factors that could cause actual
results, performance or achievements to differ materially include,
but are not limited to: the Company’s dependence on two mineral
projects; gold price volatility; risks associated with the conduct
of the Company’s mining activities in Botswana and South Africa;
regulatory, consent or permitting delays; risks relating to the
Company’s exploration, development and mining activities being
situated in Botswana and South Africa; risks relating to reliance
on the Company’s management team and outside contractors; risks
regarding mineral resources and reserves; the Company’s inability
to obtain insurance to cover all risks, on a commercially
reasonable basis or at all; currency fluctuations; risks regarding
the failure to generate sufficient cash flow from operations; risks
relating to project financing and equity issuances; risks arising
from the Company’s fair value estimates with respect to the
carrying amount of mineral interests; mining tax regimes; risks
arising from holding derivative instruments; the Company’s need to
replace reserves depleted by production; risks and unknowns
inherent in all mining projects, including the inaccuracy of
reserves and resources, metallurgical recoveries and capital and
operating costs of such projects; contests over title to
properties, particularly title to undeveloped properties; laws and
regulations governing the environment, health and safety; operating
or technical difficulties in connection with mining or development
activities; lack of infrastructure; employee relations, labour
unrest or unavailability; health risks in Africa; the Company’s
interactions with surrounding communities and artisanal miners;
risks related to changes in laws and regulations relating to
holders of existing gold mining rights as they relate to HDPs; the
Company’s ability to successfully integrate acquired assets; risks
related to restarting production; the speculative nature of
exploration and development, including the risks of diminishing
quantities or grades of reserves; development of the Company’s
exploration properties into commercially viable mines; stock market
volatility; conflicts of interest among certain directors and
officers; lack of liquidity for shareholders of the Company; risks
related to the market perception of junior gold companies; and
litigation risk. Management provides forward-looking statements
because it believes they provide useful information to investors
when considering their investment objectives and cautions investors
not to place undue reliance on forward-looking information.
Consequently, all of the forward-looking statements made in this
press release are qualified by these cautionary statements and
other cautionary statements or factors contained herein, and there
can be no assurance that the actual results or developments will be
realized or, even if substantially realized, that they will have
the expected consequences to, or effects on, the Company. These
forward-looking statements are made as of the date of this press
release and the Company assumes no obligation to update or revise
them to reflect subsequent information, events or circumstances or
otherwise, except as required by law.
Neither the TSX Venture Exchange nor its
regulation services provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
For further information please
contact:Nick BrodieCEO, Galane Gold Ltd.+ 44
7905089878Nick.Brodie@GalaneGold.comwww.GalaneGold.com
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