Le Lézard
Classified in: Mining industry, Business
Subjects: LAW, LIC

RIX MINERAÇÃO REAFFIRMS THE TRANSFER OF EXPLORATION SUB-PLOTS TO SIGMA BRAZIL DOES NOT IMPACT FUTURE OPERATIONS OF BOTH COMPANIES


HIGHLIGHTS

SAO PAULO, Sept. 29, 2023 /PRNewswire/ -- RIX Mineração e Consultoria S.A. ("RIX") (private), a private holding company of mining properties in Brazil located at Vale do Jequitinhonha in Minas Gerais, states that the transfer of two small sub-divisions of an exploration permit ("Exploration Sub-Plots") to Sigma Brazil was approved by the courts, subject to certain conditions. RIX believes these conditions are fair and do not impact the potential future mining operations of either one of the two companies. Hence RIX did not appeal the legal decision.

More Importantly, on June 27, 2023, the courts categorically denied an attempt to block the transfer by RIX minority shareholder, Calvyn Gardner. The courts decided that "Mr. Gardner's attempt to make his will prevail characterizes the unacceptable legal attempt to invert the majority principle upheld by every Brazilian corporation (S/A)"

The conditions allow Sigma Brazil to remove waste and ground within the areas of the Exploration Sub-Plots, as planned, in line with provisions of a standard "waste sharing agreement". The conditions just reinforced the regulations in the Brazilian Mining Code:

(i)  Sigma Brazil is just prevented from sub-leasing the "Exploration Sub-Plots" to a third party and
(ii)  Profiting from the sale of mineral ore located in the "Exploration Sub-Plots".

Both Sigma Brazil and RIX access to the Exploration Sub-Plots is ensured by the Brazilian Mining Code through a standard "waste sharing agreement". The two companies celebrated an irrevocably binding waste sharing agreement on August 9, 2023.

Roberto Coelho, MBA, a non-executive director of RIX Mineração stated: "Mr. Gardner has been contradictorily attempting to block the transfer of the two Exploration Sub-Plots, despite having agreed in writing with the transfer. As a technical director of RIX Mr Gardner had full knowledge that the Sub-Plots transferred were barren of economic mineral reserves. As a result Mr. Gardner knew the difficulty to ascertain their value because they mostly contain waste."

RIX shareholders held a shareholder meeting on May 15, 2023 approving the transfer of the Exploration Sub-Plots by the majority of the votes, following the ritual established by Brazilian Corporate Law ("Lei das Sociedades Anônimas").

These Exploration Sub-Plots do not contain any mineral reserves. The surface farms are held by private Brazilian land corporations, Miazga and Arqueana, both also 51% controlled by Ana Cabral. Therefore, RIX ascertained that the value of these two Exploration Sub-Plots were nominal. 

RIX has engaged Deloitte, an independent third-party, to conduct a market valuation of the transferred Exploration Sub-Plots, which we anticipate not being material.

ABOUT RIX MINERAÇÃO

RIX Mineração was founded and wholly owned by Ana Cabral in March 2009. RIX acquired a majority stake in Sigma's assets in August 2012. In February 2012, RIX became a Brazilian corporation "sociedade anônima". Subsequently, Ana Cabral granted a 49% stake to Calvyn Gardner as an "earned free carry" for his work as an executive in the Company. Ana Cabral owns a 51% controlling interest in RIX.

ABOUT ARQUEANA

Arqueana Empreendimentos e Participações S.A. ("Arqueana") was acquired by RIX in August 2012. In October 2012, Arqueana became a Brazilian corporation ("sociedade anônima"). RIX acquired the remaining minority stake in Arqueana in 2017, when Arqueana became RIX wholly owned subsidiary.

ABOUT MIAZGA

Miazga Participações S.A., is a Brazilian corporation "sociedade anônima" spun off from Sigma Brazil in 2017, when the company was privately held. It is controlled by Arqueana. It holds farmland properties in Vale do Jequitinhonha, Minas Gerais.

SOURCE RIX Mineracao


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