Tsodilo Resources Limited ("Tsodilo" or the "Corporation") was originally incorporated as a private company under the name of Trans Hex International Ltd. on November 29, 1995 under the laws of Ontario, Canada. The Corporation was originally established as an operating subsidiary of Trans Hex Group Limited ("Trans Hex Group"), a successful and well-established South African diamond mining company traded on the Johannesburg Stock Exchange (symbol: TRNSHEX) (see their website at
www.transhex.co.za). In 1996, the Corporation amalgamated with a reporting issuer registered in the Province of Ontario. Upon completion of a prospectus qualified initial public offering and approval of its application, the Corporation was listed later that year on the Toronto Stock Exchange and its shares became publicly traded as Trans Hex International Ltd. In effect, however, the Corporation continued as a controlled subsidiary of Trans Hex Group.
Trans Hex International Ltd. was initially established as a result of a strategic decision by its parent, Trans Hex Group, to apply three decades of skills in successfully identifying, exploring and developing (principally alluvial) diamond deposits, beyond the South African borders. The Corporation was set up to be the vehicle for all exploration and mining interests of the parent outside of South Africa, and initially acquired their active exploration projects in such diverse locations as Zimbabwe, the Central African Republic, Brazil, Namibia and Canada; some of which had been active since 1994. Between 1996 and 2001, under the technical management of Trans Hex Group, the Corporation was involved in numerous alluvial diamond exploration projects around the world.
In November 2001, Trans Hex Group advised the Corporation that due to a change in their strategic focus, no further funding would be provided to the Corporation and that as a result, activity at all its exploration properties should be suspended immediately. Trans Hex Group further advised that an application would be made to the Canadian courts for a court approved winding up of the Corporation. A special committee of independent directors (the "Independent Committee") of the Corporation was formed and following receipt of an independent technical valuation of the Corporation's exploration properties, concluded that the court approved winding-up proposed by Trans Hex would result in no financial benefit for the minority shareholders of the Corporation. After evaluating four formal alternative proposals, the Independent Committee recommended that Trans Hex Group negotiate a transaction as an alternative to the court approved winding-up with a group of minority shareholders of the Corporation.
An agreement was reached to such a transaction and a Special Meeting of shareholders of the Corporation was held on April 9, 2002 where shareholders approved the sale of substantially all of the Corporation's assets, including a 100% interest in:
- Trans Hex (Namibia) (Proprietary) Limited, holder of the Northbank (subject to a legal dispute) and Skeleton Coast (offshore) projects in Namibia;
- Trans Hex Brasil Limitada, holder of the terminated (subject to rehabilitation) Barra Grande project in Brazil; and
- Trans Hex (Zimbabwe) Limited, holder of a minority interest in the grass roots Limpopo project in Zimbabwe; and a 25% interest in the equity and debt of Newdico (Proprietary) Limited; the remaining 75% interest to be retained by the Corporation.
The assets were transferred in exchange for the settlement of all debt due and owing to the parent Trans Hex Group, a 1% interest in all dividends received by Trans Hex Group from the Northbank and Skeleton Coast projects and a 50% interest in all dividends received by Trans Hex Group from the Limpopo project. In addition, the Corporation was also released from all the long-term loans due to Trans Hex Group by the subsidiaries being sold.
The Special Meeting of Shareholders, also approved:
- the discontinuance of the Corporation from the Province of Ontario and its continuance under the Business Corporations Act (Yukon), in compliance with the provisions of the YBCA;
- the change of name of the Corporation to Tsodilo Resources Limited;
- the election of new directors; and
- the repeal of the existing stock option plan and adoption of a new stock option plan.
With the continuance of the Corporation to the Yukon, a new board of directors and dedicated management team took office in June 2002.
The Corporation holds a 100% interest in Tsodilo Resources Bermuda Limited to which the shares of its Botswana operating subsidiaries, Newdico (Pty) Ltd. and Gcwihaba Resources (Pty) Ltd. are registered.
