Guildford, which this week announced the retirement of managing director Michael Avery, has a management agreement with the Chairmen1 group that entails a success fee of $20 million for each 100 million tonnes of indicated resource of coal in connection with one or more of the projects acquired by the company prior to it being listed on the Australian Securities Exchange.

The company is now seeking to pay out the Chairmen1 group with the issue of the “consideration shares”.

“Following the issue of the consideration shares, no further instalments of the success fee will be payable to Chairmen,” the company said.

“The proposal to vary the management agreement and issue the consideration shares is conditional upon the approval of the company's shareholders being obtained at an extraordinary general meeting to be held on February 27.”

PriceWaterhouseCoopers determined that the proposal to vary the terms of the management agreement was fair and reasonable for the company's shareholders, who are not excluded from voting on the proposal.

The first instalment of the existing success fee was paid to Chairmen by Guildford on August 3 by way of the issue of 44,179,369 fully paid ordinary shares.

Guildford has developed a JORC resource in excess of 2 billion tonnes of thermal and coking coal across multiple projects in Queensland and Mongolia.

The company has substantial exploration upside with a further estimated exploration target of 0.98Bt to 8.89Bt across its managed projects.

Guildford developed a maiden JORC resource of 70.4Mt (39.7Mt indicated and 30.7Mt inferred) of coking coal on North Pit of the South Gobi project in Mongolia.

It developed maiden JORC inferred resource of 40.5Mt of coking coal on East Pit and established an exploration target of 70Mt to 892Mt, indicating significant upside potential.

The company developed maiden JORC resource of 221.4Mt (32.2Mt indicated and 189.1Mt inferred) of thermal coal for its Mid Gobi project and established an exploration target of 165Mt to 830Mt for the project.

In Queensland, it increased and upgraded its Hughenden JORC resource to 1.619Bt (123.6Mt indicated and 1.495Bt inferred) of thermal coal and established an exploration target of 285Mt to 2.83Bt.

It developed maiden Clyde Park Coal Project JORC-inferred resource of 623Mt of thermal coal and established an exploration target of 40Mt to 815Mt and an exploration target of 295Mt to 2.89Bt on the Pentland Project