THE Guyana Goldfields Inc. has reached a settlement with a group of disgruntled shareholders, deciding that it will appoint two experienced mining executives and implement a succession plan for the role of Chief Executive Officer (CEO).

The decision comes following the January 2019 announcement of a special meeting called by a group of the company’s shareholder to discuss the replacement of the current Board of Directors.

The group of Executives, who referred to themselves as “concerned shareholders”, together controls some 5.4 per cent of the company and expressed that they were unhappy with the Board’s management.

Their move was spearheaded by ousted Executive Chair of the Toronto-headquartered Guyana Goldfields Inc. Patrick Sheridan.

Sheridan has criticised the fall in share price of the company; the revision of its gold production guidance downwards and the blasting of an underground expansion which he claimed was done prior to the receipt of permits. Referring to the group as “requisitioning shareholders” in a release on Monday, the company described the agreement arrived at as “constructive”.

The two experienced mining executives to join the Board as independent directors are former Chief Operating Officer of SSR Mining Inc. Alan Pangbourne and former President and CEO of Adriana Resources Inc., CEO Allen Palmiere.

Pangbourne has more than 35 years of experience in the mining industry, including open pit and underground operations and served as Chief Operating Officer prior to his retirement last year.

Before joining SSR Mining in 2013 he was Vice President Projects, South America, with Kinross Gold Corporation.

Palmiere, too, has more than 35 years of operational and financial experience in the mining industry and has also served as CEO and Chair of HudBay Minerals Inc, and Executive Chair of South Africa’s Barplats Investment. Ltd. “We have reached a constructive outcome with the Requisitioning Shareholders,” said René Marion, Chair of the Board.

“The two new directors will add valuable experience to the Board, allowing all of us to move forward and devote our full attention to the Company’s optimisation strategy for its Aurora Gold Mine in Guyana.”

Their inclusion also means that two long-serving independent directors will step down. However, the Company stated that Jean-Pierre Chauvin, who joined the Board in 2012, as well as Michael Richings and David Beatty, who joined the Board in 2013, have agreed to step down.

“The Board warmly thanks them for their tireless service. Mr. Beatty had previously indicated that he would not stand for election at the upcoming shareholder meeting,” the release stated.

Meanwhile, Sheridan stated: “This agreement coupled with the changes already undertaken by the Company achieve our objective of positive change, specifically reconstituting the Board and management. The new Board and a new CEO will provide the fresh approach needed to optimize operations and enhance shareholder value. I would like to thank all of the shareholders who expressed support for positive change and I am sure I speak for everyone when I say: It’s time to get down to work.”

The ‘requisitioning shareholders’ have agreed to immediately withdraw the special meeting requisition previously made. They also agreed to customary standstill provisions extending through to the conclusion of the Company’s 2021 annual shareholder meeting.
Meanwhile, the ‘requisitioning shareholders’ will be reimbursed for reasonable expenses incurred by them during the proxy contest and the company has separately agreed with Sheridan to resolve certain outstanding claims.

Moving forward, the Company will nominate and recommend that shareholders vote for the election of each of the seven directors of the reconstituted Board, at the upcoming annual and special meeting of shareholders, scheduled to be held on May 22, 2019. Apart from Palmiere and Pangbourne, these include Peter Dey; Wendy Kei; René Marion; Maryse Saint-Laurent and Scott Caldwell.

Regarding the agreement to implement a succession plan for the role of CEO, the release stated that this will involve the establishment of a CEO search committee. It will work to identify a new CEO for the Company as soon as practicable and, in any event, within six months.

It will consist of independent directors Ms. Saint-Laurent as Chair and Mr. Pangbourne and Mr. Marion. Current CEO Scott Caldwell has agreed to continue to serve as President and CEO while the search is underway.

“I would like to thank the Board for all of their support and guidance over the past few years,” Caldwell said. “In addition, I would like to thank all of the men and women working at the Aurora Mine, Georgetown office and Toronto office for all of their hard work and dedication.”

Meanwhile, the Board expressed its deepest thanks to Caldwell for his “critical role in developing and constructing the Aurora Mine as well as his steady leadership during his years as a director since 2012”

It also thanked him for his service as President and CEO since 2013. “Among his many accomplishments are policies that led to training and promoting dozens of local Guyanese employees and that led to, as of last month, one million person-days without a lost-time injury at the Aurora Mine,” the release stated.