FQM Country Manager ,Dr Beene must make the documents public -ZCCM IH Minority Shareholders

In recent developments surrounding the conversion of KMP dividends into royalty, concerns have been raised by minority shareholders of ZCCM-IH regarding hidden information and lack of transparency. The call for increased openness was echoed by the esteemed institution, Caritas, which issued a press release emphasizing the importance of transparency in this matter. However, Dr. Godwin Beene, the Country Manager of First Quantum Minerals (FQM) and former Ministry of Mines Permanent Secretary, dismissed these concerns, asserting that there was no secrecy and labeling the claims as uncorroborated hearsay and conjecture. It would be imperative to explore the validity of Dr. Beene’s statement and emphasize the necessity for public disclosure of the documents in question.

Confirmation of Hidden Information and Lack of Transparency:

To ascertain the veracity of the claims made by Dr. Beene, an examination of the circular to shareholders and the available documents is imperative. The 130-page circular contained a comprehensive list of documents that were supposedly accessible for scrutiny and verification. These documents included the Articles of Association, Certificate of Incorporation, and Certificate of Share Capital of the Company, as well as audited annual reports of ZCCM-IH and KMP for specific fiscal years. Additionally, various agreements, undertakings, and reports pertaining to the transaction were mentioned.

However, despite the supposed availability of these documents, the minority shareholders diligently sought access to the full versions but were met with silence from ZCCM-IH. This silence, in itself, raises suspicions and further contributes to the perception of hidden information and lack of transparency. The failure to provide the requested documents undermines the credibility of Dr. Beene’s assertion that there was no secrecy surrounding the deal.

Involvement of Regulatory Bodies:

Recognizing the significance of the allegations, the Securities and Exchange Commission (SEC) and the Lusaka Securities Exchange (LUSE) initiated investigations in response to the shareholders’ request for increased transparency. The involvement of these regulatory bodies underscores the seriousness of the matter and highlights the need for a thorough examination of the transaction. The findings of these investigations are eagerly awaited, as they will shed light on the extent of transparency and any potential irregularities associated with the deal.

Dr. Beene’s Obligation to Publicly Disclose Documents:

Given Dr. Beene’s claim that there was no secrecy surrounding the transaction, it is imperative that he acts in line with his assertion. To dispel any doubts and ensure transparency, the minority shareholders, call upon Dr. Beene to make the relevant documents public in their entirety. These documents include The Current KMP Articles, The New KMP Articles, The Royalty Agreement, The Termination Agreement, The Settlement Deed and Release, The VAT Agreement, The FQM Undertaking, The ZCCM-IH Undertaking, The KMP Shareholders Agreement, and the audited annual reports of KMP for the last three fiscal years.

Furthermore, the shareholders emphasize the need for the Competent Person’s Report on KMP to be released, as it is pivotal in assessing the mine’s value and ensuring an independent and thorough audit of the transaction. Dr. Beene’s role as the Competent Person makes the release of this report all the more crucial for transparency and confidence-building among shareholders.

Below a press release from ZCCM-IH Minority Shareholders

Dr Beene must make the documents public as he claims that there was no secrecy

1. Background
In their statement of 16 April 2023, the minority shareholders of ZCCM-IH referred to “hidden information and lack of transparency” in the conversion of KMP dividends into royalty.
The honourable and respectable institution Caritas was rightly concerned about this situation and called for more transparency on this matter in a press release dated 20 April 2023.

In a statement, former Ministry of Mines Permanent Secretary and now FQM’s Country Manager Dr Godwin Beene discredited this honourable institution. He stated that « A simple fact-check using the ZCCM-IH website reveals that anyone can download the 130- page circular to shareholders », « There was no secrecy surrounding the deal »,« uncorroborated hearsay and conjecture ». He added that this kind of report « risks undermining current efforts to attract additional investment into the country ».

2. Confirmation of hidden information and lack of transparency

The figures and information provided in the 130-page circular to shareholders were supposed to be available for consultation and verification through various documents. We wanted to check with great vigilance that these figures would subsequently be in line with reality.

On page 31 of the circular to shareholders, the list of documents “available for inspection” and the way they can be consulted were specified (Appendix):
• the Articles of Association of the Company, the Certificate of Incorporation, and the Certificate of Share Capital.
• the audited annual reports of ZCCM-IH for the fiscal years ended March 2019, and December 2020, and the unaudited financial statements for the fiscal year ended December 2021.
• The audited annual reports of KMP for the last 3 fiscal years ended 31 December 2019,2020, and 2021.
• Signed copy of the Report of the Independent Reporting Accountant.
• Signed copy of the Framework Agreement.
• The New KMP Articles
• The Royalty Agreement
• The Termination Agreement
• The Settlement Deed and Release
• The VAT Agreement
• The FQM Undertaking
• The ZCCM-IH Undertaking
• Competent Person’s Report on KMP.
• The KMP Shareholders Agreement
• The Current KMP Articles
• the written consents of the Competent Person, Transfer Secretary, Legal Advisors,Financial Advisor, Reporting Accountant and Transaction Sponsoring Broker on the Transaction named in this Circular to act in those capacities, none of whom have withdrawn their consent prior to registration.On page 125, the notice of Extraordinary General Meeting circular indeed informed that
« the Circular includes the salient terms of the transaction » and « extracts » of certain documents.

We are well aware that the devil is in the detail. That is why, as mentioned in our press release of 16 April 2023, we repeatedly asked ZCCM-IH for access to the full documents.
We confirm that the only response was a deafening silence.

3. Regulatory Bodies have tackled this issue

Following our request, the SEC and LUSE have recently replied that they have initiated investigations and come back to us once the investigations are completed.

4. Dr Beene must make the documents public as he claims that everything is transparent Since Dr Beene states that « There was no secrecy surrounding the deal », we request that he makes the following documents public in full : The Current KMP Articles, The New KMP Articles, The Royalty Agreement, The Termination Agreement, The Settlement Deed and Release, The VAT Agreement, The FQM Undertaking, The ZCCM-IH Undertaking,

The KMP Shareholders Agreement, The audited annual reports of KMP for the last 3 fiscal years ended 31 December 2019, 2020, and 2021 and above all The Competent Person’s Report on KMP as FQM, yet fully involved in the agreement, is the Competent Person,without an independant thorough audit of the mine.

5. Shareholder of First Quantum Minerals and transparency I am also a shareholder of First Quantum Minerals. The honourable and respectable Caritas institution is unanimously recognised for its support and defence of the interests of the poorest and the voiceless. Dr Beene’s posture towards this institution calling for more transparency appears therefore inappropriate. The frivolous reasons give the impression of being a counter-fire to the lack of transparency highlighted.

The majority of FQM’s owners are financial institutions, pension funds and small investors.They invest ethically and are respectable shareholders who are concerned that FQM’s
mining operations be shared fairly and transparently with local people. According to FQM,« First Quantum Minerals Ltd., and its subsidiaries (collectively, the “Company”) is
committed to conducting its business with high standards of ethics ». For a respectable shareholder, if transparency is an issue, this would suggest that deals and the
business are fishy.

For the avoidance of doubt, as a shareholder of First Quantum Minerals, I am therefore suggesting Dr Beene to make all the above documents public.

Issued by:
Thierry CHARLES
Spokesperson of Minority Shareholders of ZCCM-IH
23 May 2023, FRANCE.