Make up of the BoD

In my opinion, there appears to be 2 primary issues with the make up of Century Mining`s BoD that could leave one questioning whether the BoD is currently structured in a manner to act in the best interest of all shareholders:


1) Lack of Canadian residence currently on the BoD (does not appear to meet the Canada Business Corporations Act requirement of 25%).

* William J.V. Sheridan, Toronto, Ontario, Canada as municipality of residence

* Ricardo M. Campoy, Larchmont, NY, USA as municipality of residence

* William G. Lamarque, Yorkshire, United Kingdom as municipality of residence

* Francis Scola, Rhode Island, USA as municipality of residence

* Daniel Major (likely municipality of residence of UK or US or somewhere else other than Canada)


2) The current make up of the BoD (between company/shareholder appointed members (``incumbent directors``) versus Finskiy-Scola appointed members (``Investor``)) appears to be out of balance, relative to what was approved by shareholders.

Company/shareholder appointed (``incumbent``) Directors - 2:

* William J.V. Sheridan
* Ricardo M. Campoy,

Finskiy-Scola appointed (``Investor``) Directors - 3:

* William G. Lamarque
* Francis Scola
* Daniel Major – I consider Mr Major to be Finskiy-Scola appointed. Mr Major is a Director of Ecometals – a company Scola is involved with. Mr. Major`s CMM website profile currently states that he is a Director of Zaruma Resources – a company with Finskiy and Scola as directors and financial backers. Mr Major was part of Lamaque`s Operating Committee over the past year - likely representing Finskiy-Scola`s (``Investor``) side.

Shareholders approved a balanced BoD (company appointed vs Finskiy-Scola appointed) during the November 23, 2009 Special Meeting (see below).

The Shareholders Agreement profiles a balanced BoD in the document filed on SEDAR on January 14, 2010. The Shareholders Agreement was signed by Margaret Kent, representing the company, and by Finskiy (representing Kirkland) and Scola (representing Gravity).

Shareholders approved a balanced BoD (company appointed vs Finskiy-Scola appointed) during the June 11, 2010 Annual Meeting (see below).

I don`t know what type of timeframe they legally have in order to get it balanced again, after Peggy`s resignation (a company/shareholder appointed (``incumbent``) director - 1 of the 3) 8 months ago, but they sure seem to be taking their sweet time. It has been 8 months now and they still have not filled the 3rd director position from the commpany/shareholder/``incumbent`` side, yet they didn`t seem to have any problems replacing directors and maintaining the allowable 3 directors on the Finskiy-Scola side. It is only natural to wonder why?



BoD structure approved via Special Meeting of Shareholders

SEDAR filing: October 29, 2009, pg 8

Meeting Date (Special Meeting of Shareholders): November 23, 2009

From the Management Circular:

``Board of Directors
Upon Closing, it is anticipated that the board of directors of the Company (the “Board”) will be comprised of five members. It is anticipated that two members of the current Board (Margaret Kent and William Sheridan) will remain on the Board; two members will be appointees of the Investor (expected to be Francis Scola and William Lamarque) and one new independent director (who will be appointed Chairman of the Board) will be mutually selected by the Investor and the incumbent directors at Closing. Mr. Lamarque is a Partner with Balor Capital Management LLC and President of Hanson Capital Asia Ltd. As of the date hereof, the parties have not selected the independent director.

It is also anticipated that at the Company’s first meeting of Shareholders following the Meeting, the Board will be increased to seven members. The Investor will have the right, and will continue to have the right, to nominate three of the seven members to the Board (with one of the seven members to be jointly nominated by the Investor and the incumbent directors) until such time as the Lamaque project reaches an annualized run rate of at least 75,000 ounces of gold over a period of at least four consecutive months at a cash cost of US$500 or less per ounce (the “Operating
Criteria”). After the Operating Criteria is achieved, the Investor shall have the right to nominate members to the Board pro rata to the Investor’s percentage interest in the Common Shares.``



Signed Shareholders Agreement Document

Shareholders Agreement document filed on SEDAR on January 14, 2010 (pg 8-9) is consistent with the info approved in the Special Meeting (posted above). The Shareholders Agreement document was signed by Margaret Kent, representing the company, and by Finskiy (representing Kirkland) and Scola (representing Gravity) – pg 17.



BoD approved via Annaual Meeting of Shareholders

SEDAR: May 19, 2010, pg 4 - 5

Meeting Date (Annual Meeting): June 11, 2010

Approved by shareholders at the annual meeting (the understanding is that the 7th director would be an independent Canadian Chairman, hence allowing the BoD structure to be both align with 25% CBCA Canadian content rule and maintain a 3 to 3 BoD balance between company and Finskiy-Scola):

Company/shareholder appointed Directors - 3:

1) Margaret M. Kent Blaine, Washington, USA as municipality of residence
2) William J.V. Sheridan Toronto, Ontario, Canada as municipality of residence
3) Ricardo M. Campoy Larchmont, NY, USA as municipality of residence

Finskiy-Scola appointed Directors - 3:

1) William G. Lamarque Yorkshire, United Kingdom as municipality of residence
2) Francis Scola Rhode Island, USA as municipality of residence
3) Keith R. Hulley California, USA as municipality of residence