Monument Mining Ltd. V.MMY

Wolfgang's Offer To Westgold

[romara]

AXINO Investment GmbH · Fleischmannstrae 15 · 73728 Esslingen am Neckar
Monument Mining Limited
Board of Directors
1100 Melville Street
Vancouver, BC, V6E 4A6
Canada
Attn: Ms. Cathy Zhai, President & CEO
Mr. Robert F. Baldock, Chairman
November 14, 2020
Shareholder Request
Dear Cathy and Robert,
This letter is being sent to you on behalf of shareholders of Monument Mining Limited (“Monument” or the
“Company”) domiciled in Europe, Asia and North America and who collectively hold or control, directly or
indirectly, approximately 64% of the Company’s shares (collectively, the “Concerned Shareholders”). Please
ensure that the entire board of directors is provided a copy.
As you may recall, AXINO Investment GmbH (“Axino”) has been a shareholder of the company since April 2007,
when we bought our first tranche of shares at 0.50 CAD. Over the past 13 years, we have demonstrated our
commitment to the Company by continually increasing our own holdings. In addition, we have introduced
numerous new shareholders to the Company, most of whom remain shareholders today notwithstanding the
ongoing value destruction that they and we have experienced during your tenure with the Company.
In 2011, we sent you a letter recommending that you spin out your interest in the Mengapur project into a new
entity (“Newco”) which would allow you to further develop the project with fresh capital that could be raised in
Newco instead of using the Company’s limited financial resources. However, you never responded to the letter
or tried to engage with us, one of your long term and largest shareholders. Instead, you chose to move forward
and push the acquisition through your AGM at the time and since then have wasted large amounts of cash –
your shareholder’s cash – in consolidating your interest in Mengapur and trying to develop the project.
Even so, Axino and a number of the Concerned Shareholders supported this management team through a
subsequent dissident campaign to dislodge the board of directors, having faith that our concerns would
ultimately be recognized and a reorientation of the corporate strategy could be implemented for the betterment
of all shareholders.
Unfortunately, that has not occurred and you continue to apply the same strategy, this time in respect of the
Company’s corporate activities within Western Australia. By doing so, management and the board has lost its
focus on the company’s gold operations in Malaysia, to the detriment of all shareholders.
Notwithstanding our longstanding concerns with these strategies, this letter is not to revisit the past – we
cannot change what has already occurred. However, the purpose of this letter is to remind you of your fiduciary

 

AXINO Investment GmbH Geschftsfhrung Sitz der Gesellschaft: Esslingen am Neckar Telefon [phone]
Fleischmannstrae 15 Wolfgang Seybold Registergericht: Amtsgericht Stuttgart E-Mail [e-mail]
73728 Esslingen am Neckar Bankfachwirt Handelsregister: HRB 737408 Internet www.axino.com
duties in charting the future of the Company and ensure that you realize that the board is accountable to the
shareholders as custodians of their investment.
The accumulated toll of the historical mismanagement of the Company’s strategy has been significant.
Currently, the Concerned Shareholders, representing approximately 64% of the Company’s shares are losing
confidence in this board and management team. When we met at PDAC earlier this year, I had expressed to
you the concerns of the Concerned Shareholder group - they do not want Monument managed and operated
as a private entity and they are frustrated with their legitimate concerns being ignored. They understand that
a potential value change within the Company’s asset portfolio takes years and does require new investments
to build the necessary operating plant on each of the company’s assets to generate additional cash flows.
However, as these are new risks to the Company, the Concerned Shareholders would only accept this if they
are going to receive an earlier reward. In our view, that can be achieved by the following strategic changes:
1. Focus on gold operations in Malaysia (Selinsing)
2. Sell the Mengapur asset
To the extent achievable, this would capitalize the Company to further evaluate the increase of gold
production at Selinsing, either by expanding the production of oxide gold ore (new discoveries or third
parties’ ore) or building the sulphide plant to treat existing refractory ore.
3. Sell the Murchison assets.
I have introduced you to a potential buyer, Westgold Resources Limited (“Westgold” ), of the assets. I
have recently talked to Westgold’s chairman, Peter Cook, and he has confirmed to me that your
decision to sell the Tuckanarra asset to a third party is acceptable and that he remains interested in
the remaining Murchison assets. Therefore, the Concerned Shareholders want you to negotiate a
potential asset sale under the following terms:
a. Each Monument shareholder to receive, for each 25 Monument shares held at the record date, 1
Westgold share via an in specie distribution to all Monument shareholders (share deal via
dividend).
b. Monument to receive a cash payment of $10MM AUD from Westgold, 50% of which should be
paid on execution of a binding transaction agreement and the remaining 50% six months after that
date.
4. Release a detailed strategic plan for increasing gold production and cash management.
The board is the steward of shareholder capital and serves at their direction and with the expectation that their
concerns will be heard and acted upon where in the best interests of the Company. The Concerned
Shareholders, representing as they do a controlling interest in the Company, deserve to be a part of your
decisions. We and the remaining Concerned Shareholders have been very patient in trying to work
collaboratively with you. However, if we do not see a change in how the Company is being managed and a
more transparent process in terms of the decisions that are being made in line with the foregoing strategic
priorities, the Concerned Shareholders will no longer support the board and we will be forced to take matters
into our own hands. This is not a threat, this is your reality. We are tired of empty promises and failed results.
Monument is in the middle of a strong metal bull market. The sale of the Murchison assets is critical, as
shareholders will see a chance of getting their first return since 2007. If you do not see the Westgold
transaction as a potential solution and one with which to engage with your principal shareholders, we will be
forced to consider alternatives to ensure that all shareholders are aware of the opportunities available and the Company takes the steps needed to be responsive to shareholder concerns. We are putting together our team
of advisors to support us to prepare for next steps.
If we do not receive appropriate engagement by the board by November 30, 2020, the Concerned Shareholders
will regard this as reflective of the board’s failure to live up to shareholders’ reasonable expectations to
manage their capital and we will take appropriate steps to rectify the situation quickly and decisively.
We look forward to hearing from you. You can reach us via Skype or mobile at [phone].
Sincerely yours,
AXINO Investment GmbH
Wolfgang Seybold

 

 

AXINO Investment GmbH Geschftsfhrung Sitz der Gesellschaft: Esslingen am Neckar Telefon [phone]
Fleischmannstrae 15 Wolfgang Seybold Registergericht: Amtsgericht Stuttgart E-Mail [e-mail]
73728 Esslingen am Neckar Bankfachwirt Handelsregister: HRB 737408 Internet www.axino.com
Company takes the steps needed to be responsive to shareholder concerns. We are putting together our team
of advisors to support us to prepare for next steps.
If we do not receive appropriate engagement by the board by November 30, 2020, the Concerned Shareholders
will regard this as reflective of the board’s failure to live up to shareholders’ reasonable expectations to
manage their capital and we will take appropriate steps to rectify the situation quickly and decisively.
We look forward to hearing from you. You can reach us via Skype or mobile at [phone].
Sincerely yours,
AXINO Investment GmbH
Wolfgang Seybold
Managing Director
cc. Dexter John, President & CEO of Gryphon Advisors Inc., Toronto