Core Gold Inc. [CGLD-TSVV; CGLDF-OTCQX] has clarified the circumstances surrounding the recent termination of its former President and CEO Keith Piggott, for cause. The company said in press release it was issuing the clarification in response to stakeholder inquiries.
Core said Piggott was initially put on notice by the company in November 2018 for, among other things, incurring new debt at the subsidiary level without notice to, or approval of the board of directors, and for conducting activities at the company’s projects in Ecuador that were in breach of Core’s contractual obligations that were then in effect.
“These activities were not disclosed to the board or other members of senior management,” the company said. “In response, the board required that Piggott not exceed certain expenditure limits without board approval and that he cease undertaking activities that would cause Core to breach its contractual commitments,” the company added. “In addition, the board required that Piggott cease using his personal email for company activities.”
Core said Piggott did not abide by these directives from the board. Subsequently and in addition, he also misappropriated for his personal use what the board believes was approximately $50,000 as well as causing the disclosure of confidential information related to the merger discussions with Titan Minerals Ltd. [TTM-ASX] outside the company, Core said in its press release.
Accordingly, the board made the decision to terminate Piggott for cause for these reasons, the company said.
Mark Bailey, a Core director, agreed to act as Interim CEO after Piggott’s consulting agreement was terminated and he was removed from the position of President and CEO.
The clarification notice follows a March 11, 2019 press release in which Core and Titan Minerals jointly announced that they had consented to amend the terms of a previously announced agreement that will see Titan acquiring all of the issued and outstanding shares of Core Gold by way of a share exchange transaction.
Under the amended agreement, Titan has agreed to purchase 9.15 million common shares of Core Gold on a private placement basis at 44 cents per share for total subscription proceeds of US$3 million.
Upon completion of the private placement, Titan will hold approximately 5.7% of the outstanding shares of Core Gold, the companies said.
Titan mining is the owner and operator of a copper and gold business in southern Peru.
Core Gold owns 100% of three mining production areas located in southern Ecuador. The company is currently focused on the Dynasty Goldfield Project, an open pit mine, which has a total NI 43-101-compliant resource of 2.2 million ounces of gold, the company has said. Core Gold began mining operations at Dynasty Goldfield within four months of assuming control of the company in September 2016.
Its portfolio also includes the Zaruma Gold Mine and Portovelo Mill project.
The Dynasty Goldfield is currently producing 750 tonnes per day of 3.2 g/t gold, material that is being processed at the Portovelo plant. Having produced more than 70,000 ounces of gold and 150,000 ounces of silver, the Zaruma gold mine is currently on stand-by.
Core Gold said it plans to use the net proceeds of the core private placement for expenditures related to repayment of government payables, annual concession payments and general working capital purposes.
Core Gold shares were unchanged Wednesday at 24 cents. The shares trade in a 52-week range of 19 cents and 34.5 cents.