PHOENIX GOLD LTD The Manager
Company Announcements Office ASX Limited
Level 40, Central Park
152-158 St George's Terrace PERTH WA 6000
Phoenix Gold Ltd
ABN 55 140 269 316
PO BOX 100
KALGOORLIE WA 6433
Dear Sir / Madam
FOR IMMEDIATE RELEASE
Phoenix Gold Limited (ASX: PXG) - takeover bid by Evolution Mining Limited - Target's Statement
In accordance with item 14 of section 633(1) of the Corporations Act 2001 (Cth), please find enclosed a copy of the target's statement of Phoenix Gold Limited (ABN 55 140 269 316) (Phoenix Gold) dated 29 September 2015 (Target's Statement) in response to the off-market takeover bid by Evolution Mining Limited (ABN ABN 74 084 669 036) (Evolution) for all the ordinary shares in Phoenix Gold.
A copy of the Target's Statement was lodged with the Australian Securities & Investments Commission and served on Evolution earlier today.
Yours faithfully
Ian Gregory
Director & Company Secretary Phoenix Gold Limited
2457555v1 allionlegal.com
In response to the takeover bid made by
Evolution Mining Limited (ABN 74 084 669 036)
For all the ordinary shares in
The directors of Phoenix Gold Limited unanimously recommend that you
To REJECT the Evolution Offer DO NOTHING
Financial Advisor Legal Advisor
This is an important document and requires your immediate attention.
If you are in any doubt about how to deal with this document, you should contact your broker, financial advisor or legal advisor immediately.
Important notices
Nature of this document
This document is a Target's Statement issued by Phoenix Gold Limited (ABN 55 140 269 316) (Phoenix) under Part 6.5 Division 3 of the Corporations Act in response to the off-market takeover bid made by Evolution Mining Limited (ABN 74 084 669 036) for all the ordinary shares in Phoenix.
A copy of this Target's Statement was lodged with ASIC and given to ASX on 29 September 2015. Neither ASIC nor ASX nor any of their respective officers take any responsibility for the content of this Target's Statement.
Phoenix shareholder information
Further information relating to the Evolution Offer can be obtained from Phoenix's website at www.phoenixgold.com.au.
Defined terms
A number of defined terms are used in this Target's Statement. These terms are explained in section 10 of this Target's Statement. In addition, unless the contrary intention appears or the context requires otherwise, words and phrases used in the Corporations Act have the same meaning and interpretation as in the Corporations Act.
No account of personal circumstances
This Target's Statement does not take into account your individual objectives, financial situation or particular needs. It does not contain personal advice. Your Directors encourage you to seek independent financial and taxation advice before making a decision as to whether or not to accept the Evolution Offer.
Disclaimer as to forward looking statements
Some of the statements appearing in this Target's Statement may be in the nature of forward looking statements. You should be aware that such statements are only predictions and are subject to inherent risks and uncertainties. Those risks and uncertainties include factors and risks specific to the industry in which Phoenix operates as well as general economic conditions, prevailing exchange rates and interest rates and conditions in the financial markets. Actual events or results may differ materially from the events or results expressed or implied in any forward looking statement. None of Phoenix, Phoenix's officers and employees, any persons named in this Target's Statement with their consent or any person involved in the preparation of this Target's Statement, makes any representation or warranty (express or implied) as to the accuracy or likelihood of fulfilment of any forward looking statement, or any events or results expressed or implied in any forward looking statement, except to the extent required by law. You are cautioned not to place undue reliance on any forward looking statement. The forward looking statements in this Target's Statement reflect views held only as at the date of this Target's Statement.
Disclaimer as to information
The information on Evolution contained in this Target's Statement has been prepared by Phoenix using publicly available information. The information in the Target's Statement concerning Evolution and its assets and liabilities, financial position and performance, profits and losses and prospects, have not been independently verified by Phoenix. Accordingly, Phoenix does not, subject to the Corporations Act, make any representation or warranty, express or implied, as to the accuracy or completeness of such information.
Foreign jurisdictions
The release, publication or distribution of this Target's Statement in jurisdictions other than Australia may be restricted by law or regulation in such other jurisdictions and persons who come into possession of it should seek advice on and observe any such
restrictions. Any failure to comply with such restrictions may constitute a violation of applicable laws or regulations. This Target's Statement has been prepared in accordance with Australian law and the information contained in this Target's Statement may not be the same as that which would have been disclosed if this Target's Statement had been prepared in accordance with laws and regulations outside Australia.
Maps and diagrams
Any diagrams, charts, maps, graphs and tables appearing in this Target's Statement are illustrative only and may not be drawn to scale. Unless stated otherwise, all data contained in diagrams, charts, maps, graphs and tables is based on information available at the date of this Target's Statement.
JORC Code
Certain information in this Target's Statement that relates to the Exploration Results, Mineral Resources or Ore Reserves was prepared and first disclosed under the JORC Code 2004. It has not been updated since to comply with the JORC Code 2012 on the basis that the information has not materially changed since it was last reported. All material assumptions and technical parameters underpinning the estimates of Mineral Resources continue to apply and have not materially changed.
Privacy
Phoenix has collected your information from the Phoenix register of shareholders for the purpose of providing you with this Target's Statement. The type of information Phoenix has collected about you includes your name, contact details and information on your shareholding in Phoenix. Without this information, Phoenix would be hindered in its ability to issue this Target's Statement. The Corporations Act requires the name and address of shareholders to be held in a public register. Your information may be disclosed on a confidential basis to Phoenix's related bodies corporate and external service providers (such as the share registry of Phoenix and print and mail service providers) and may be required to be disclosed to regulators such as ASIC. If you would like details of information about you held by Phoenix, please contact Computershare Investor Services Pty Limited at the address shown below:
Level 11, 172 St Georges Terrace Perth, Western Australia 6000
Phone (within Australia): 1300 850 505
Phone (international): +61 8 9323 2000 The registered address of Phoenix is:
Unit 2, 53 Great Eastern Highway West Kalgoorlie
Western Australia 6430
Why you should REJECT the Evolution Offer
1 | The offer consideration under the Evolution Offer undervalues your Phoenix Shares The Independent Expert for the Zijin Offer valued a Phoenix Share at between $0.156 to $0.244 which represents a 19% to 87% premium to the implied value of the Evolution Offer price of $0.1307 (using Evolution's current 20-day volume weighted average price). | Refer to page 3 |
2 | The Evolution Offer does not fairly reflect the value of the Phoenix Assets Your Directors urge you not to let Evolution profit to your detriment - the Evolution Offer fails to recognise the value that has already been demonstrated for the Phoenix Assets | Refer to page 3 |
3 | Accepting the Evolution Offer will diminish your exposure to any potential increase in value that the Phoenix Assets offer Your Directors urge you not to sell to Evolution at a price that does not, in the opinion of your Directors, reflect the medium and long term potential upside that Phoenix offers you | Refer to page 5 |
4 | The Phoenix Assets carry significant strategic value for Evolution following Evolution's recent asset acquisitions in the region, which is not fully reflected in the Evolution Offer Your Directors urge you not to allow Evolution to benefit from valuable synergies to your detriment | Refer to page 5 |
5 | If you accept the Evolution Offer, your shareholding in Evolution will represent a very small proportion of the total Evolution Shares on issue Under the terms of the Evolution Offer, Phoenix shareholders will, in aggregate (excluding Evolution's shareholding in Phoenix), account for only 1.55% of Evolution's total enlarged shares outstanding | Refer to page 6 |
6 | The value of any future dividend entitlements to you as an Evolution shareholder is likely to be immaterial Your Directors urge you not to be influenced by the potential for future dividend payments that are likely to amount to a very small value, depending on your shareholding | Refer to page 7 |
To REJECT the Evolution Offer, you should DO NOTHING and TAKE NO ACTION in relation to all documents sent to you by Evolution
CONTENTS
WHY YOU SHOULD REJECT THE EVOLUTION OFFER 3
FREQUENTLY ASKED QUESTIONS 8
DIRECTORS' RECOMMENDATION 12
OVERVIEW OF PHOENIX 13
OVERVIEW OF EVOLUTION AND ITS INTENTIONS 18
YOUR CHOICES AS A PHOENIX SHAREHOLDER 22
KEY FEATURES OF THE EVOLUTION OFFER 23
INFORMATION RELATING TO YOUR DIRECTORS 29
ADDITIONAL INFORMATION 31
GLOSSARY AND INTERPRETATION 36
AUTHORISATION 40
KEY DATES
Date of the Evolution Offer 25 September 2015
Date of this Target's Statement 29 September 2015
Close of the Evolution Offer Period (unless extended or withdrawn)
7.00pm AEST on 26 October 2015
29 September 2015 ASX Code: PXG
Dear Fellow Phoenix Shareholder,
I am writing to you in response to the Bidder's Statement, which you will have recently received from Evolution Mining Limited outlining Evolution's unsolicited and conditional takeover offer for your shares in Phoenix Gold Limited.
The Directors believe that the Evolution Offer price of 0.06 Evolution Shares and A$0.06 cash per Phoenix Share is inadequate and does not reflect fair value. Accordingly, your Directors unanimously recommend that all Phoenix shareholders REJECT the Evolution Offer. Key reasons why you should REJECT the Evolution Offer are:
The offer consideration under the Evolution Offer undervalues your Phoenix Shares based on the valuation range for Phoenix Shares as assessed by the Independent Expert for the Zijin Offer.
The Evolution Offer is inadequate and does not fairly reflect the value of the Phoenix Assets.
Accepting Evolution's Offer will diminish your exposure to any potential increase in value that the Phoenix Assets offer.
The Phoenix Assets carry significant strategic value for Evolution following Evolution's recent asset acquisitions in the region, which is not fully reflected in the Evolution Offer.
If you accept the Evolution Offer, your shareholding in Evolution will represent a very small proportion of the total Evolution Shares on issue.
The value of any future dividend entitlements to you as an Evolution shareholder is likely to be immaterial.
The Directors consider that the Evolution Offer is inadequate and does not provide sufficient consideration to Phoenix shareholders, particularly in the context of the strategic benefits the Phoenix assets offer to Evolution and its recently acquired Mungari Operations.
Each of your Directors who holds or controls Phoenix Shares intends to REJECT the Evolution Offer in relation to those shares.
Your Directors wish to also draw your attention to the conclusion of the Independent Expert, BDO Corporate Finance (WA) Pty Ltd, in relation to the Zijin Offer. The Independent Expert concluded that the Zijin Offer of
$0.10 per Phoenix Share was neither fair nor reasonable. Whilst the conclusion drawn by the Independent Expert was in relation to the Zijin Offer, the Independent Expert valued a Phoenix Share at between $0.156 and
$0.244. Your Directors note that the Independent Expert's valuation range for a Phoenix Share was determined by valuation methodologies not impacted by the Zijin Offer or the Evolution Offer. As such, your Directors are of the view that the valuation range determined of the Independent Expert in connection with the Zijin Offer demonstrates that the Evolution Offer undervalues your Phoenix Shares.
To REJECT the Evolution Offer, simply DO NOTHING.
The Phoenix Board recommends that you carefully read all the information contained in this Target's Statement and seek independent advice. Your Directors will continue to keep you updated on all material developments with respect to the Evolution Offer and any other competing offer that may eventuate. In the meantime, if you have any questions please contact the Phoenix Shareholder Information Line on 1300 889 468 (within Australia) or +61 2 8022 7902 (outside Australia). All Company announcements are available on our website, www.phoenixgold.com.au
Yours sincerely,
Dale Rogers Executive Chairman
WHY YOU SHOULD REJECT THE EVOLUTION OFFER
The offer consideration under the Evolution Offer undervalues your Phoenix Shares based on the valuation range for Phoenix Shares as assessed by the Independent Expert for the Zijin Offer.
Phoenix engaged BDO Corporate Finance (WA) Pty Ltd as an Independent Expert to prepare an Independent Expert Report in relation to the Zijin Offer.
The conclusions drawn by the Independent Expert were in relation to the Zijin Offer, however, the valuation range for a Phoenix Share determined by the Independent Expert considered the intrinsic value of a Phoenix Share irrespective of the Zijin Offer. The Independent Expert assessed the value of a Phoenix Share on a 100% controlling interest basis to be in the range of $0.156 to $0.244.
Figure 1: Independent Expert's Phoenix Valuation Opinion for the Zijin Offer
Value of a Phoenix Share on a control basis
Implied value of the Evolution Offer consideration per Phoenix Share (based on Evolution's 20-day VWAP)
$0.00 $0.05 $0.10 $0.15 $0.20 $0.25
Value (A$)
Source: BDO Independent Expert's Report for the Zijin Offer, Bloomberg. Analysis is based on the 20-Day VWAP for Evolution Shares for the period ending 28 September 2015, being $1.1777.
Your Directors are of the view that the valuation range for a Phoenix Share determined by the Independent Expert in connection with the Zijin Offer provides a highly relevant reference point for the Evolution Offer, and demonstrates that the Evolution Offer undervalues your Phoenix Shares.
The Evolution Offer does not fairly reflect the value of the Phoenix Assets
In the opinion of your Directors, the Evolution Offer fails to recognise the potential of the Phoenix Assets. The Evolution Offer implies a value of approximately $56.2 million1. Your Directors believe that the combined value of the Phoenix Assets is higher than this figure, given the size of the mineral resources, the demonstrated discovery potential of the region and the development friendly location.
The Phoenix Assets contain one of Australia's largest undeveloped gold Mineral Resources and are located approximately 60km from Kalgoorlie, in one of Australia's premier goldfields.
1 Implied enterprise value of the Phoenix Assets based on the implied value of the Evolution Offer price of $0.1307 per Share (based on Evolution's 20-day volume weighted average price), less the cash at bank, gold bullion on hand and receivables totalling approximately A$5.2 million as at 30 June 2015.
Figure 2: Attributable Gold Resources of Comparable Junior ASX Listed Gold Exploration Companies
7,000
Gold Resources (koz gold)
6,000
5,000
4,000
3,000
2,000
1,000
0
Gold Road Resources
Blackham Resources
Phoenix Gold ABM Resources Dacian Gold Excelsior Gold Peel Mining
Source: ASX disclosures. Includes comparable ASX listed exploration stage companies with assets located primarily in Australia, with a market capitalisation greater than A$20 million
Whilst the Directors consider the companies set out in the chart above are at a comparable stage of development to Phoenix, they believe that the Phoenix Assets have a number of critical advantages over several of its peer group's projects including scale of the Phoenix Assets, the anticipated conversion of Indicated Mineral Resources to Ore Reserves and the significant infrastructure support:
Scale
The Kunanalling Shear and the Zuleika Shear are two world class shear zones holding the Company's 500km2 of tenure, consistently delivering resource and reserve growth year on year.
Phoenix projects located along strike from several major gold camps, including Kundana gold camp, Evolution's Frog's Leg deposit and Mt Pleasant field.
Independently assessed Mineral Resources of 112.5 million tonnes of ore containing 4.02 million ounces2 of gold with an average grade of 1.1 g/t (estimated in accordance with the JORC Code 2012).
All Mineral Resources are situated on granted Mining Leases and the majority are amenable to bulk tonnage open pit mining and conventional CIL processing.
Infrastructure
Significant infrastructure is in place adjacent to the Phoenix Assets, including:
six established processing facilities, including Evolution's Mungari Mill and Norton's Paddington Mill;
a sealed highway;
a 220kV power transmission line;
a borefield; and
skilled labour and mining service providers, given close proximity to Kalgoorlie-Boulder.
In addition, Phoenix has an agreement to purchase the St Ives 2Mtpa standalone heap leach processing plant.
All of which will service to lower both the time and cost to develop the Phoenix Assets, when compared to a more remote or greenfields resource.
Stable environment for development
Low sovereign risk in a pro-mining jurisdiction, which is an important consideration when evaluating project financing.
2 Mineral Resource estimate comprising Indicated Mineral Resources of 65.93 million tonnes at 1.1 g/t gold (2.288 million ounces) and Inferred Mineral Resources of 45.04 million tonnes at 1.2 g/t gold (1.68 million ounces).
The Evolution Offer fails to recognise both the value that has already been demonstrated for the Phoenix Assets, and Phoenix's unrealised potential.
Accepting the opportunistic Evolution Offer will diminish your exposure to any potential increase in value that the Phoenix Assets offers
Your Directors believe the Evolution Offer is opportunistic and timed to capture value that will otherwise flow to Phoenix shareholders in the medium and long term.
In the past 12 months, Phoenix has focused on the growth of Mineral Resources and Ore Reserves, developing and implementing the staged development plan inclusive of smaller scale mine development, exploring joint venture opportunities with Norton Gold Fields Limited (Norton) under existing mining and milling agreements between the parties, and advancing the heap leach strategy. In particular, Phoenix has completed a number of developments to enhance the understanding and value of the Phoenix Assets, including:
approving a staged development strategy to minimise capital expenditure utilising existing spare milling capacity in the Goldfields region;
shifting its exploration focus to the Zuleika Gold Project, with predictive modelling complete and target priorities identified;
securing the Heap Leach Facility to treat lower grade ore from the Castle Hill Project;
successfully completing drilling programmes at the flagship Castle Hill Project; and
completing a definitive feasibility study demonstrating a robust 8 year initial mine plan, a new 2Mtpa processing plant and 2Mtpa heap leach operation.
exploration of high priority targets to expand the current Resource and Reserve base, particularly Castle Hill and Kundana North;
formalisation of a Licence to Mine and Ore Sale Agreement with Norton over Castle Hill Project Stage 1;
advance heap leach project development; and
accelerate exploration programme on the Zuleika Gold Project.
The Phoenix Assets carry significant strategic value for Evolution following Evolution's recent asset acquisitions in the region, which is not fully reflected in the Evolution Offer
As outlined in the Evolution Bidder's Statement, one of the reasons Evolution has identified for making the Evolution Offer is the 'Strong strategic rationale' by virtue of 'the close proximity of the Phoenix tenements to Evolution's Mungari Operations…' Evolution notes that this close proximity '…creates the opportunity for numerous synergies.' Your Directors are of the view that the potential value of the Phoenix Assets to the Mungari Operations, including synergies, exceeds the implied valuation of the Evolution Offer.
The synergies that may be extracted by Evolution from controlling the Phoenix Assets, and which would not be available to Evolution if it did not control the Phoenix assets, include:
Processing ore from the Phoenix Assets (including tenements within the Phoenix Assets that adjoin tenements within the Mungari Operations) through the Mungari Operations' processing facility;
Extending the operating life of the Mungari Operations;
Consolidating the administrative functions of Evolution and Phoenix in Western Australia; and
Consolidating exploration activities in the region.
Whilst the Evolution Offer includes a scrip component, this only represents a portion of the consideration being offered, meaning that Phoenix shareholders' exposure to the Phoenix Assets will be diluted and Phoenix shareholders will not fully benefit from any potential creation of value through synergies achieved as a result of the combination of the Mungari Operations and the Phoenix Assets.
Your Directors firmly believe that Phoenix shareholders should be entitled to a greater proportion of the potential value creation available under a combination of the Phoenix Assets and the Mungari Operations.
If you accept the Evolution Offer, your shareholding in Evolution will represent a very small proportion of the total Evolution Shares on issue
The Evolution Bidder's Statement lists several reasons for why Phoenix shareholders should, in Evolution's opinion, accept the Evolution Offer, including but not limited to: 'You will become a shareholder in a leading Australian mid-tier gold producer.' Whilst your Directors do not disagree with this statement, the benefits that will accrue to Phoenix shareholders as a result of becoming a shareholder in Evolution are limited by the minority shareholding that Phoenix's current shareholders (excluding Evolution) would account for in Evolution under the terms of the Evolution Offer. Based on
Evolution's total ordinary shares outstanding as at 28 September 2015, Phoenix shareholders will, in aggregate (excluding Evolution's shareholding in Phoenix), account for only 1.55%3 of Evolution's total enlarged shares outstanding.
Figure 3: Phoenix Shareholder Ownership in Enlarged Evolution
1.55%
98.45%
Phoenix shareholder ownership in enlarged Evolution Non-Phoenix shareholder ownership in enlarged Evolution
Source: ASX disclosures. Does not account for cross-shareholdings. Analysis includes Foreign Phoenix Shareholders and Unmarketable Parcel Shareholders.
As demonstrated in Figure 3 above, your exposure to the enlarged Evolution will be very minor, which, in the opinion of your Directors, is not adequate compensation for relinquishing your full exposure to the potential future value creation from the Phoenix Assets. If you accept the Evolution Offer, any
3 Analysis includes Foreign Phoenix Shareholders and Unmarketable Parcel Shareholders who are not entitled to receive Evolution Shares (refer section 12.1 and 13.7 of the Evolution Bidder's Statement) but who represent only a small portion of the total Phoenix Shares outstanding.
future appreciation in the share price of Evolution would accrue 1.55%4 to current Phoenix shareholders (excluding Evolution) and 98.45% to current Evolution shareholders.
Acceptance of the Evolution Offer will see the aggregate Phoenix Shares held by Phoenix shareholders (excluding Evolution) represent just 1.55%5 of the enlarged Evolution total shares outstanding. Your Directors believe that this minority position, combined with the cash component of the Evolution Offer, does not adequately reflect the contribution of the Phoenix Assets to Evolution.
The value of any future dividend entitlements to you as an Evolution shareholder is likely to be immaterial
The Evolution Bidder's Statement includes in the list of reasons for why Phoenix shareholders should, in Evolution's opinion, accept the Evolution Offer, 'Potential for receipt of dividend payments.'
Your Directors note that the benefit that will accrue to Phoenix shareholders as a result of the potential receipt of future dividend payments is limited by the relatively small fraction of an Evolution Share that is being offered for each Phoenix Share under the scrip component of the Evolution Offer.
Under the terms of the Evolution Offer, you are being offered 0.06 Evolution Shares and $0.06 cash for each Phoenix Share you hold. As such, for each Phoenix Share you hold today, you will only be entitled to 0.06 dividends per share that may be paid by Evolution in future.
Figure 4 below provides some illustrative examples of what the value of dividend payments may be worth to you, assuming a range of Phoenix shareholdings and based on the most recent Evolution semi-annual dividend payment declared of $0.01 per share unfranked (declared on 27 August 2015).
Figure 4: Illustrative Value of Evolution Dividends Based on Current Phoenix Shareholding
Number of Phoenix Shares Currently Held
Value of Most Recent Evolution Unfranked Dividend per Share
Implied Value of Most Recent Evolution Unfranked Dividend per Phoenix Share
Total Value of Unfranked Dividends Based on Phoenix Shareholding
Shareholding in Enlarged Evolution Based on Phoenix Shareholding
5,000
$0.01
$0.0006
$3.00
0.00002%
10,000
$0.01
$0.0006
$6.00
0.00004%
20,000
$0.01
$0.0006
$12.00
0.00008%
50,000
$0.01
$0.0006
$30.00
0.00021%
100,000
$0.01
$0.0006
$60.00
0.00041%
200,000
$0.01
$0.0006
$120.00
0.00082%
500,000
$0.01
$0.0006
$300.00
0.00205%
This illustrative analysis demonstrates that your exposure to future Evolution dividend payments is likely to be negligible.
Additionally, your Directors note that, as an existing shareholder of Phoenix, you are eligible to receive any future dividend payments made by Phoenix and participate in any future appreciation in the price of Phoenix shares.
Your Directors urge you to consider the relatively immaterial value that any future Evolution dividend payments are likely to represent to you.
4 Analysis includes Foreign Phoenix Shareholders and Unmarketable Parcel Shareholders who are not entitled to receive Evolution Shares (refer section 12.1 and 13.7 of the Evolution Bidder's Statement) but who represent only a small portion of the total Phoenix Shares outstanding.
5 Analysis includes Foreign Phoenix Shareholders and Unmarketable Parcel Shareholders who are not entitled to receive Evolution Shares
(refer section 12.1 and 13.7 of the Evolution Bidder's Statement) but who represent only a small portion of the total Phoenix Shares outstanding.
FREQUENTLY ASKED QUESTIONS
reject the Evolution Offer by doing nothing;
sell your Phoenix Shares on ASX (unless you have previously accepted the Evolution Offer); or
accept the Evolution Offer.
On this basis, it is in Evolution's interest to buy as many Phoenix Shares as possible at the cheapest possible price before any increase in the value of the Phoenix Assets.
If Evolution acquires your Phoenix Shares now, it will diminish your opportunity to participate in the full value accretion from the Phoenix Assets that may occur in the future.
Your Directors believe that the Company has a well-developed strategy to create value for its shareholders. In particular, your Directors believe that you should consider the following developments which are scheduled to occur throughout the next several months:
Although completion of these developments is subject to risk, markets and uncertainties and cannot be guaranteed, your Directors believe that the potential rewards substantially outweigh the potential risks.
Your Directors believe that operational enhancements to the Phoenix Assets should result in further value accretion for shareholders in the short to medium term. Your Directors consider that Evolution has recognised this and has timed its bid accordingly for its own benefit.
This section answers some commonly asked questions about the Evolution Offer. It is not intended to address all relevant issues for Phoenix shareholders. This section should be read together with all other parts of this Target's Statement.
Question Answer
Who is making the Evolution Offer? Evolution Mining Limited.
What will I receive for my Phoenix Shares under the Evolution Offer?
Evolution is offering 0.06 Evolution Shares and A$0.06 cash for each Phoenix Share you hold.
What choices do I have as a Phoenix shareholder?
As a Phoenix shareholder, you have the following choices in respect of your Shares:
There are several implications in relation to each of the above choices. A summary of these implications is set out in section 6 of this Target's Statement.
Can I accept the Evolution Offer for some, but not all, of my Phoenix Shares?
No. You cannot accept the Evolution Offer for part of your Phoenix Shares. You can only accept the Evolution Offer for all of your Phoenix Shares.
What are your Directors recommending?
Each Director recommends that you REJECT the Evolution Offer. In order to do so you should do nothing and not respond to any correspondence from Evolution.
What do the Directors and management intend to do with their Shares?
Each Phoenix director and member of management who has a relevant interest in Phoenix Shares intends to reject the Evolution Offer in relation to those Shares.
What are the consequences of accepting the Evolution Offer now?
If you accept the Evolution Offer, you will give up your right to sell your Phoenix Shares on ASX or otherwise deal with your Shares while the Evolution Offer remains open.
If the share price trades above the Evolution Offer price you will have lost your ability to sell your Shares on ASX at that higher price.
If I accept the Evolution Offer, can I withdraw my acceptance?
No. If you accept the Evolution Offer, you will not be able to trade your Phoenix Shares on ASX and there are only limited circumstances in which you may withdraw your acceptance (see section 7.9 for further details).
What happens if Evolution increases its Offer price under the current Evolution Offer?
If Evolution increases its Offer price during the Evolution Offer Period, all Phoenix shareholders will be entitled to the benefit of any increase in the Evolution Offer price (including those Phoenix shareholders who have already accepted the Evolution Offer prior to the increase).
As at the date of this Target's Statement, Evolution has not made any statement regarding its intention to increase the Evolution Offer price. However, Evolution has not made a
'last and final' statement as to whether it will increase the
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