The Supreme Court has declared that shares and options were invalidly issued to entities linked to Abyssinian chairman Neil Warburton, chief executive Stephen Miller and non-executive director Bruce Tinney in October last year.
And Justice Michael Lundberg has ordered that the disputed securities be wiped off the Abyssinian register ahead of a re-scheduled vote on a board putsch being led by Argonaut stockbroking boss Eddie Rigg.
With a shareholder meeting last month having been blocked by the court, the new orders are set to cut the share holding of incumbent directors by around one-fifth to a still-commanding 38 per cent of issued scrip.
Mr Warburton told The West Australian he had agreed to a settlement to save “a lot of time and effort” on a legal row. “All shareholders will have time to vote their shares according,” he said.
Mr Rigg wants a new team led by First Quantum co-founder and former Allkem chair Martin Rowley to take control of developing Abyssinian’s Kenticha lithium project in Ethiopia.
The Rigg-Rowley camp claimed support from about 110 of 164 shareholders in the unlisted company ahead of a meeting originally scheduled for July 28.
They faced the almost impossible task of removing Mr Warburton, Mr Miller and Mr Tinney given the three incumbents owned about 46 per cent of the issued shares.
Argonaut last month succeeded in having the meeting adjourned after legally questioning the circumstances surrounding a board resolution purportedly signed on March 8, 2021, for the issue of performance rights to directors.
Australian Securities and Investments Commission records list Mr Warburton and Mr Tinney as not having joined until March 23, 2023.
Deciding to defer last month’s meeting, Justice Lundberg described Argonaut’s attack on the March 2021 circular resolution as “relatively strong”.
But Justice Lundberg said the attack on the actual issue of 15 million shares and 5 million options in October 2021 was not a “strong basis of challenge, saying it would require a deep and closer assessment of factual material.
“There may be nuances as to the course of events which are not yet apparent,” he said.
Orders handed down by Justice Lundberg on Friday order the 15 million shares and 5 million options be removed from the Abyssinian share register.
He ordered the proceedings be dismissed with each party bearing its own costs.
Justice Lundberg has ordered the resumed shareholder meeting be held some time between September 9 and September 16.
Mr Rigg said the court orders vindicated his group’s attack on the share and option issues.
After the orders were handed down, Mr Warburton sent a letter to shareholders claiming the attempts to remove the board would have been defeated on July 28 regardless of whether the performance shares were included.
“In view of the clear mandate outlined by the company’s shareholders for the existing directors, Abyssinian’s directors have agreed to resolve the court proceedings,” he said in the note.
But he promised that any future performance rights for executive directors would be “brought to all shareholders for approval”.
A date for the meeting has not yet been set.
