On July 15th, 2016; VCS Mining, Inc. and Delta Société Miniere S.A entered into an agreement which superseded and cancelled the non-binding Stock Transfer Agreement signed on April 9th, 2010 in become effective” on May 26, 2010 “The effective date” which were made in accordance to an equity Shareholder whose primary conditions of his company and his investment that he must be the President and CFO of VCS. Now, for avoidance of doubt The May 26th, 2010 stock transfer agreement did not contain any provision of control of Delta by VCS. Delta maintain its owned board of directors and management and have the rights to make its independent decision without the assistance or approval of VCS or VCS’s Management. The agreement transfer was solely based on a best effort basis.
After the Senate Resolution of February 20th, 2013 which was non legal binding resolution because the Executive Branch of the Government did not respond nor agree to the Senate request resolution; therefore, without the Executive branch responses or acceptance of such resolution; the resolution does not have any legal standing. But created a false perception for any interested investors and the misinterpretation by the media.
On July 2016, the management of both parties agreed that Delta Société Miniere which held the exploitation permit for the Morne Bossa property is a Haiti self-owned company under laws of Haiti. The Managements of both companies agreed to cancelled and replaced the May 26th, 2010 Stock Transfer Agreement with a new Amended version that allow VCS to maintain the same rights under define terms and conditions (The performance base). Theses conditions allow Delta on its own to attract invest with or without VCS help. The summary of the conditions and Terms are as follow:
Terms and Conditions
- 1. VCS pursuant to the May 26, 2010; VCS would own 98% of all issues and outstanding shares of Delta Société Minière, S.A. Pursuant to the following terms:
- a) VCS – Maintain all costs of employees of Delta Société Minière S.A directly or indirectly,
- b) VCS- Maintain all office costs of Delta Société Minière S.A directly or indirectly,
- c) VCS- Maintain a mining development program campaign of a minimum of $400,000 USD per annum from the signing of the agreement for a minimum of 3 years consecutively;
- d) VCS – shall invest a minimum of $40 Million USD toward production directly or indirectly;
- 2. Upon VCS met the following clauses of the terms and conditions 1.1(a)(b)(c) and (d). VCS shall Maintain the 98% of the Shares of Delta Société Minière S.A.
(a) Delta Société Minière S.A. shall pay VCS Mining, Inc. $1.00 for the agreement of the amendment.
3. Reversion Rights:
3.1 Upon VCS fails to maintain and makes any of the expenditures, Delta Société Minière shall issue notice of the failure to VCS or its nominees of the failure to maintain the terms of the agreement. Upon issuance of three (3) notices.
3.2 The Parties agree that in the event that VCS fails to maintain and makes any of the expenditures payment set out in clause 1.1 (a), (b), (c) and (d), and VCS management had received the three (notices as described under clause 3.1; VCS shall no longer have any ownership interest in the Company. Any and all shares shall be considered void.
The Management of the companies agreed that VCS Mining, Inc. has raised capital to further advance Delta Société Minière Development. Therefore, despite that clause 3.1 and clause 3.2 occur; the Parties further agree that Delta Société Minière S.A board of Directors at Delta’s sole discretion may choose to convert solely the current shareholders of VCS to Delta Société Minière S.A shareholders on a one to one share basis. Therefore, each shareholder of VCS shall maintain the same share percentage of VCS’s ownership as Delta Shareholders. Furthermore, Delta Board of Directors and Management at its sole discretion may choose to honour and pay any VCS’s Mining past debt under Delta Société Minière’s sole Terms and Conditions.
Note: Now for the avoidance of doubt, the Original “Stock Transfer Agreement” was made in signed on April 9th, 2010 and become effective on May 26th, 2010 (The effective date).
On March 28th, 2017; RGC formerly known as VCS entered into an agreement with 3D Resources which would allow the company remain under the original terms signed under the amended conditions; therefore, would allow VCS to maintain the share ownerships from the original STA. However, in May 18th, 2018. RGC Terminated the agreements with 3D because they have breach the agreements and committed a series of misconducts which under RGC’s policy there is a zero tolerance policy on such misconduct. Please refer to the press release link: http://vcsmining.com/2018/06/03/announcement-of-3d-resources-default-termination-may-18-2018-2/ .
On September 19, 2018 – After different talks and negotiation between 3D and the companies; 3D agree to forfeit any investment made into the companies a matter to obtain a liability release from the companies post termination the “Mutual Deed and Liability Release” http://vcsmining.com/2018/09/20/mutual-deed-and-liability-release-post-termination-of-3d-resources-and-the-companies/ a matter for the companies not to file any action against 3D and its officers.
Prior the Mutual release, the officers of both companies considered a new restructuring process that will allow 3D Resources under its subsidiary to acquire up to 100% of the company based on milestones and payments. All was subject to the following:
- The restrictions of a certain parties will not work in the projects under any management capacities in except as a a consultant
- Satisfactory payments are made on specific dates.
The companies via monitoring the press releases of 3D Resources on the Australia stock exchange realizes that 3D via the propose restructure agreement was not really planning to carry forward with the projects. But a matter to save face from the Australian shareholders after they raised a certain amount of cash announcing the propose restructure and setup an exit strategy method to walk away and kept the residuals fund from its shareholders base under false pretention. By creating a series of false statements on the Australian public market.
The legal counsel and management of the companies warn 3D resources of the false statements. And immediately terminated the propose restructure agreement completely and took appropriate actions. Later on 3D announces it has withdrawn itself from the Haiti project by trying by concealing the information under a 56 pages annual report to shareholders June 30-2019 (page 13) to shareholders. Please see 3D’s press release https://www.asx.com.au/asxpdf/20190930/pdf/44915xtsbpw2p8.pdf.
In Summary: RGC have not been able to invest or maintain the conditions under the STA agreement of July 15th, 2016 with Delta which are most due to the Senate non-binding agreement and the instability of Haiti. RGC had in fact received notices from Delta of the failures of the terms and conditions. Therefore, RGC has failed to meet the agreement in accordance to the STA of July 15th, 2016.
On mid-August 2019; Delta Société Minière, S.A received supporting evidence from Resource Générale Corporation from a reputable Investment Group that will meet the terms and conditions of the STA agreement based on terms define by the Investment Group including but not limited to the Haitian Government passing the mining law or publicly provide a statement retracting the non-binding resolution of the senate as well as other conditions. The propose investment is valid up to 3 years and such proposal can be withdrawn from the Investment Group at their sole discretion. However, RGC will not received any of the funds until the conditions are met.
Delta Management agreed and acknowledge the supporting evidence of RGC. But will not restore the “Reversion Rights (3.1 and 3.2) of the STA. until the payments the conditions of the terms and conditions clause 1.1 (a), (b) and (c) are met; and supporting evidence of 1.1(d) is made into an escrow account. Or a new method of investment comes in which may be considered by Delta assuming Delta during such period did not find another source of investment.
The Companies managements remain very cordial to a process that would work for all parties. However, Delta Management will not change its position until validated fund is in place. RGC thanks Delta management, for its understanding and willingness to work together and took to account the sacrifices that have been made to date.