The “New” Company will be called “Voyager Resources Limited”, if it is allowed to be formed and installed on the Australian Stock Exchange with an initial capital recapitalization of $1,775,000-00!
The General Meeting will be held at Level 24, St Martins Tower, 44 St Georges Terrace, Perth, WA 6000 on 20 July 2009 commencing at 11am (WST).
BDO Kendalls Corporate Finance (WA) Pty Ltd
Level 8, 256 St Georges Terrace Perth WA 6000
PO Box 7426 Cloisters Square Perth WA 6850
Phone 61 9360 4200
Fax 61 9481 2524
bdo@bdo.com.au
www.bdo.com.au
ABN 27 124 031 045
AFS Licence No. 316158
5 June 2009
The Administrators
Lafayette Mining Limited
c/o Ferrier Hodgson
Level 29
600 Burke Street
Melbourne VIC 3000
Dear Sirs
INDEPENDENT EXPERT'S REPORT – LAFAYETTE MINING LIMITED
1. INTRODUCTION
Lafayette Mining Limited (“Lafayette” or “the Company”) proposes to undergo a capital restructure (“the Proposal”) that includes the following events:
issue of 90 million shares to Trident Capital Pty Ltd and/or its nominees (including Tim Flavell and Matthew Wood or their nominees) at an issue price of $0.005 per share (“Trident”);
acquisition of Voyager Resources Pty Ltd (“Voyager”) for the consideration of 105 million shares;
Lafayette’s current issued capital is consolidated on a 1 for 100 basis;
the issue of up to 190 million shares via a prospectus at an issue price not less than $0.01 per share (“the Prospectus”); and
the potential for Tim Flavell, Nick Lindsay and Matthew Wood (“the Directors”) to subscribe for shares under the Prospectus.
As all the resolutions which effect the above are interdependent we will refer to them collectively as the Proposal in this report.
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2.3 Opinion
We have considered the terms of the Proposal as outlined in the body of this report and have concluded that the Proposal is fair and reasonable to Shareholders.
In arriving at out opinion we have placed particular reliance on Lafayette’s position being such that if the Proposal is not approved then it is likely that Lafayette will be liquidated.
We believe that the Directors would be justified in recommending that Shareholders vote in favour of the Proposal
2.4 Fairness
In Section 11 we determined that the current value of a Lafayette share compares to the value of a Lafayette share if the Proposal is approved, as detailed hereunder.
Value prior to the Proposal
Ref: 9 Low: - Preferred: - High: -
Value following the Proposal
Ref: 10 Low: 4 cents Preferred: 4.5 cents High: 5 cents
The above pricing indicates that, in the absence of any other relevant information, and a superior offer, the Proposal is fair for Shareholders.
2.5 Reasonableness
We have considered the analysis in Sections 12 and 13 of this report, in terms of both
advantages and disadvantages of the Proposal; and
alternatives, including the position of Shareholders if the Proposal is not approved.
In our opinion, the position of Shareholders if the Proposal is approved is more advantageous than the position if the Proposal is not approved. Accordingly, in the absence of any other relevant information and/or a superior proposal we believe that the
Proposal is reasonable for Shareholders.
The respective advantages and disadvantages considered are summarised below:
Advantages:
14.1.1 The Proposal is fair
14.1.2 Early return to trading
14.1.3 Eliminates uncertainty of value
14.1.4 Elimination of debt
14.1.5 Shareholders can participate in capital raising
Disadvantages:
14.2.1 Dilution of Shareholder interest
14.2.2 Loss of control
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4. OUT LINE OF PROPOSAL
Lafayette has entered into a reconstruction deed (“the Reconstruction Deed”) with Trident. The Reconstruction Deed proposes the following:
Trident or its nominees will acquire 90 million shares in Lafayette in consideration for $450,000.
The issue of up to 190 million shares via a prospectus at an issue price not less than $0.01 per share.
Trident will pay for all necessary requirements for the reinstatement of Lafayette to the ASX.
The current directors of Lafayette will resign.
Trident will appoint three new directors.
The Reconstruction Deed is conditional on the following:
The variation of the current Deed of Company Arrangement (“DOCA”) to reflect the resolutions included in the Notice of Meeting.
ASX confirming that the Reconstruction Deed will not prevent Lafayette from retaining its ASX listing and that the ASX will not impose any requirements on the Company under Listing Rule 11.1.3.
The following resolutions being passed at a meeting of Shareholders:
o Lafayette’s current issued capital is consolidated on a 1 for 100 basis.
o Lafayette’s capital is reduced by applying a portion of the accumulated losses of the Company against the share capital of the Company which is considered permanently lost.
o Lafayette issues the 90 million shares to Trident and its nominees and performs the capital raising as noted above.
o The Company changes its name to Voyager Resources Limited.
At completion Lafayette will pay $500,000 to the Administrators. As a result of the payment to the Administrators, the Administrators must provide all relevant documentation to release Lafayette of all charges, security and any other encumbrances over, affecting or relating to the Company and the DOCA will be terminated.
Lafayette will also acquire all the issued shares of Voyager through the issue of 105 million shares in Lafayette.
