Adyton Resources Corporation (TSX Venture: ADY) (“Adyton” or the
“Company”) today announces that the Company’s Chairman, President
and CEO, Mr Frank Terranova, has been terminated without cause and
has also resigned as a director of the Company, all effective 9:00
am ET on December 24, 2021. In addition, independent directors Mr
Jason Kosec, Mr Nick Tintor, Mr Fred Leigh and Mr Peter DuPlessis,
as well as Mr Rod Watt, a director and Chief Geologist of the
Company (collectively, the “Resigning Directors”), have each
tendered their resignation as a director effective at 9:00 am ET on
December 31, 2021. Mr. Watt has also resigned as Chief Geologist
effective at the same time.
Mr Terranova’s termination and resignation as a
director and the resignations of the Resigning Directors are
attributable to what Mr Terranova and the Resigning Directors
consider to be irreconcilable differences with Mayur Resources
Limited (“Mayur”), Adyton’s largest shareholder owning
approximately 43% of the Company’s shares, regarding the Company’s
proposed C$4 million brokered private placement led by Eight
Capital announced on December 3, 2021 (the “Private Placement”) and
the business strategy for the Company, including the approach to
the exploration and development of its exploration projects in
Papua New Guinea, and demands made by Mayur for governance
changes.
Following the announcement of the Private
Placement by the Company on December 3, 2021, Mayur objected to the
terms of the Private Placement, expressing the view that the amount
sought to be raised exceeded Adyton’s requirements, was overly
dilutive and was being conducted in a rushed manner, all to the
detriment of Adyton and its shareholders. Mayur proposed certain
potential financing alternatives to Adyton, all of which were
conditional on the termination of Mr Terranova from all positions
he holds with Adyton, but ultimately without being able to conclude
any agreement on financing with the Board of Directors. Mayur has
indicated that it intends to requisition a meeting of the
shareholders of the Company to implement changes to the Company’s
Board of Directors and remove Mr Terranova as Chairman, President
and CEO and, accordingly, Mr Terranova and the Resigning Directors
are taking these actions to enable Mayur to proceed with such
changes as it wishes to implement without the need for a
shareholders meeting.
Mr Terranova and the Resigning Directors share
the frustration of all of Adyton’s shareholders, including Mayur,
about the Company’s share price. However, in their view, this does
not detract from the fact that Adyton has successfully completed
the programs it set out to conduct when it initially listed on the
TSX Venture Exchange in February 2021. Since that time, Adyton has
achieved considerable operational success with the completion of
its stated exploration programs on the Fergusson Island and Feni
Island projects, which resulted in significant increases in total
mineral resources across the projects, the declaration of a maiden
indicated resource on the Fergusson Island project, and most
recently, the reporting of a significant copper intercept from one
of the five holes drilled as part of the Feni Island project
drilling program.
Based on their significant experience with
junior exploration companies and taking into consideration feedback
received from market participants, Mr Terranova and the Resigning
Directors believe the most likely means of achieving share price
appreciation for all Adyton shareholders is by undertaking further
exploration activities on one or more of the Company’s projects
targeted at progressing them through milestones that substantively
de-risk them, making them more attractive to potential equity
investors, purchasers of the projects, joint venture partners and
other similar parties. If the Company is unable to undertake these
further exploration activities due to insufficient funding, it is
the view of Mr Terranova and the Resigning Directors that this will
result in a lack of potential developments for Adyton which is
likely to lead to reduced investor interest, further downward
pressure on the Adyton share price and reduced investor appetite to
participate in financings Adyton may need to undertake.
Following the release of the Feni Island project
exploration results on December 1, 2021, Adyton was advised by
Eight Capital that those results had generated some investor
interest in Adyton, creating the potential for it to undertake a
financing provided it could be completed quickly and was
appropriately priced in the context of the market to make it
attractive to investors. Taking into consideration the matters
described above, their experience that the availability of equity
financing for junior exploration companies is highly volatile, and
that it is necessary to move quickly to take advantage of financing
windows when they appear, it was, and remains, the view of Mr
Terranova and the Resigning Directors that it is in the best
interests of Adyton and all its stakeholders for Adyton to seek to
take advantage of the financing window created by the Feni Island
exploration results to secure as much financing as possible and
necessary for the next phase of Adyton’s exploration programs. Mr
Terranova and the Resigning Directors consider the previously
proposed Private Placement to have been an acceptable financing
alternative available to Adyton given current market
conditions.
Following Mayur’s objections to the Private
Placement, representatives of the Resigning Directors held
discussions with representatives of Mayur’s Board of Directors with
the objective of reaching a mutually agreed financing and business
strategy for Adyton. Those discussions were not successful. While
Mayur proposed potential alternative financing proposals which
would be less dilutive to Adyton’s shareholders, they were
considered by Mr Terranova and the Resigning Directors to be
inferior to the Private Placement as they would not provide Adyton
with sufficient financing to attempt to progress the Company’s
projects to potential milestones that might be sufficient to result
in share price appreciation. It is the view of Mr Terranova and the
Resigning Directors that further discussions with Mayur will not
achieve a mutually agreeable business strategy and consequently an
adequate financing transaction.
Moreover, based on these events, management and
the Board understand and believe that the probability of
successfully completing the Private Placement has substantially
diminished.
Taking into account the fundamental differences
of opinion between Mayur and Mr Terranova and the Resigning
Directors regarding the business and financing strategy for Adyton
and the demands made by Mayur for governance changes, the Resigning
Directors consider their position to be untenable and have
therefore reluctantly taken the decision to terminate Mr Terranova
as demanded by Mayur and resign their positions in order for Mayur
to implement such governance changes as it wishes in the quickest
manner possible. The period through to December 31, 2021 will be
utilised to effect an orderly transition to Mr Tim Crossley, also a
director of Mayur, and Mr Sinton Spence, as the continuing
directors of the Company and to allow them and Mayur time to
consider the appointment of additional directors to replace some or
all of the Resigning Directors.
ON BEHALF OF ADYTON RESOURCES CORPORATION
Frank Terranova, Chairman, President and Chief Executive
Officer
For further information please contact:
Frank Terranova, Chairman, President and Chief Executive
Officer
E-mail: fterranova@adytonresources.com
Phone: +61 7 3854 2389
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 press release.
ABOUT ADYTON RESOURCES CORPORATION
Adyton Resources Corporation is focused on the
development of gold and copper resources in world class mineral
jurisdictions. It currently has a portfolio of highly prospective
mineral exploration projects in Papua New Guinea on which it is
exploring for copper and gold. The Company’s mineral exploration
projects are located on the Pacific Ring of Fire which hosts
several world class copper and gold deposits.
Adyton was formed by a reverse takeover
transaction completed with XIB I Capital Corporation on February
17, 2021 and commenced trading on the TSX Venture Exchange under
the symbol “ADY” on February 24, 2021.
Adyton is also quoted on the OTCQB under the
code ADYRF the Frankfurt Stock Exchange under the
code 701:GR
For more information about Adyton and its
projects, visit www.adytonresources.com.
A photo accompanying this announcement is available at
https://www.globenewswire.com/NewsRoom/AttachmentNg/295c409b-646f-4c2d-9319-727f7d578039
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