LONDON (Alliance News) - Nyota Minerals Ltd said Monday that two non-executive directors, Norman Ling and Neil Maclachlan, have retired from the board, as previously announced, while shareholders have vote against a remuneration plan.
The gold exploration and development company said the departures are integral to the company's strategy of reducing costs following the sale of a 75% interest in the major Tulu Kapi gold site to KEFI Minerals PLC in December.
Nyota said the board now consists of just three people, including Chief Executive Richard Chase.
?All of our cost cutting is fundamental at the moment,? Chief Executive Richard Chase told Alliance News on Thursday. ?Cutting back our board from five to three is a rational decision considering where we are right now.?
The company also said that at its Annual General Meeting on Monday, while all other resolutions previously announced were passed, a resolution to adopt the company's planned remuneration report, although not binding, was not passed.
The remuneration report sets out a range of matters relating to the remuneration of the company's key management personnel for the year ended June 30, 2013, including a USD381,320 payment to Chase, including shares and options, and a USD254,673 payment to former Technical Director Martyn Churchouse, including shares and options.
Nyota said that steps have already been taken in the current year to address remuneration concerns including reducing the board to three persons and agreeing in January to a material reduction in salary for the Chase and fees for other Directors.
The news comes after Nyota announced last week that its pretax loss narrowed in the first-half of its financial year as administrative expenses dropped significantly, but said it needs to raise new funds in the first half of 2014 for the development of its projects.
Nyota said it will need to raise funds in order to pay for ongoing costs at Tulu Kapi and to continue its exploration programme. It said it may decide to not fund its pro-rata share of Tulu Kapi, but will suffer dilution of its shareholding as a result.
"We may drop off our 25% interest in Tulu Kapi moving forward to focus on the Northern Blocks and other assets, but it definitely will not be for twelve months because I'll be giving away too much value," Chase said.
However, Chase told Alliance News on Thursday that the company would rather maintain its project interest in Tulu Kapi but cut back the shareholding in KEFI stock it received as part of the asset sale.
?I intend to maintain the project interest in KEFI,? Chase said. ?In terms of hierarchy, my 25% direct interest in the project ranks much higher than my interest in KEFI.?
However, currently the shares in KEFI are being held in escrow until six months after the sale deal, in June, when Chase can begin a sale process, if necessary.
"At this point we are not out to sell KEFI stock, and I think we'll have an idea of our funding plans in the next few weeks," Chase added.
The company ran into trouble in 2013 regarding its Tulu Kapi project. It announced its first ore reserve of 16.9 million tonnes at 1.82 grams of gold per tonne early in the year, but the gold price declined and the company's balance sheet meant that it struggled to find a joint venture partner to develop the site.
In December, the company sold a 75% stake in the Tulu Kapi site to KEFI Minerals for cash and the issue of KEFI shares to Nyota, leaving the company with a 25% direct interest and a roughly 34% beneficial interest in the project, taking into account its holding in KEFI shares.
Nyota Minerals shares closed down 22% at 0.350 pence Monday.
By Tom McIvor; tommcivor@alliancenews.com; @TomMcIvor1
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