TIDMMRP
RNS Number : 8098B
Meridian Petroleum PLC
02 November 2009
Monday 2 November 2009
MERIDIAN PETROLEUM PLC
("Meridian" or "the Company")
Publication of Circular
Further to the Company's announcement on 30 October 2009 in relation to, inter
alia, a proposed Placing and Open Offer, the Company announces that a circular
setting out details of the Proposals ("Circular") has today been posted to
Shareholders.
The Circular, which includes a notice ("Notice of EGM") convening an
Extraordinary General Meeting of the Company to be held at the offices of Grant
Thornton UK LLP, 30 Finsbury Square, London at 11.00 a.m. on 30 November 2009,
is available to view on the Company's website (www.meridianpetroleum.com).
In view of the disruptions currently affecting postal services throughout
England, a copy of the Letter from the Chairman, Directors and Advisers, Capital
Raising Statistics and Expected Timetable of Principal Events is reproduced
below. In addition, a copy of the Notice of EGM is set out in Appendix 1 to this
announcement and a summary of the provisions of the New Articles which are
proposed to be adopted pursuant to a Resolution to be considered at the EGM is
extracted from paragraph 5 of Part V of the Circular and set out in Appendix II
to this announcement.
Shareholders are advised to complete and return their Forms of Proxy and, where
relevant, their Application Forms as soon as possible and, in any event, so as
to be received by Equiniti Limited, of Aspect House, Spencer Road, Lancing, West
Sussex, BN99 6DA, by no later than as detailed in the expected timetable of
principal events in the Circular.
Defined terms used in this announcement are the same as those set out in the
Circular and are reproduced in Appendix III.
For further information contact:
+-------------------------------------------+-------------------------------+
| Meridian Petroleum | +44 (0) 207 811 0140 |
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| Stephen Gutteridge, Chairman | |
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| | |
+-------------------------------------------+-------------------------------+
| Evolution Securities | +44 (0) 207 071 4300 |
+-------------------------------------------+-------------------------------+
| Robert Collins, Adam James, Tim Redfern | |
+-------------------------------------------+-------------------------------+
| | |
+-------------------------------------------+-------------------------------+
| Equiniti Limited | +44 (0) 121 415 0279 |
+-------------------------------------------+-------------------------------+
| Chris Atwood | |
+-------------------------------------------+-------------------------------+
| | |
+-------------------------------------------+-------------------------------+
| Financial Dynamics | +44 (0) 207 831 3113 |
+-------------------------------------------+-------------------------------+
| Ben Brewerton, Ed Westropp | |
+-------------------------------------------+-------------------------------+
Meridian Petroleum PLC
(Incorporated and registered in England under the Companies Act 1985 with
registered number 5104249)
Directors:
Stephen Gutteridge (Chairman)
Angelo Baskaran (Finance Director)
Peter Clutterbuck (Non-executive Director)
David Wake-Walker (Non-executive Director)
Registered Office:
13 Regent Street
London
SW1Y 4LR
2 November 2009
Dear Shareholder,
Placing and Open Offer of 27,614,498 New Ordinary Shares at 25 pence per share
Amendments to Loan Facility
Cancellation of Options and Warrants
Subscription for New Ordinary Shares
Proposed Board Changes
Proposed Change of Name
Capital Reorganisation
Adoption of New Articles
and
Notice of Extraordinary General Meeting
1. Introduction
Your Board is pleased to announce a significant change in the Group's strategy,
with the objective of achieving the critical mass of a mid-cap independent
exploration and production company with a strategic presence in key areas of
interest. The Board will develop this strategy globally, focusing on selected
acquisitions with the potential for significant reserves, resources
and production capability in fast-growing hydrocarbon provinces. This is a
transformational step for the Group and the foundations from which to implement
the strategy have been announced today. LCM will become a major strategic
investor in the Group. LCM has strong industry connections and experience which
will be of significant benefit to the Group in implementing the new strategy.
The Board has also today announced a substantial capital raising, supported
by institutional investors, the strengthening of the Board and management and a
change of name.
Your Board proposes to raise approximately GBP6.9 million (before expenses) by
the issue of 27,614,498 New Ordinary Shares at a price of 25 pence per New
Ordinary Share. The Capital Raising is being made by way of a Placing and Open
Offer, thus allowing the Company's existing Shareholders the opportunity to
participate in the fundraising. In addition, New Ordinary Shares are to be
issued pursuant to the Subscription.
The Issue Price of 25 pence per New Ordinary Share represents a 52.83 per cent.
discount to the closing middle market price of 53 pence per Existing Ordinary
Share on 29 October 2009, the last Business Day before the announcement of the
Capital Raising.
Of the combined 29,352,998 New Ordinary Shares to be issued pursuant to the
Proposals (representing approximately 64.59 per cent. of the Enlarged Share
Capital immediately following completion of the Proposals), 27,614,498 New
Ordinary Shares will be issued pursuant to the Placing and Open Offer (of which
5,364,498 New Ordinary Shares are being made available under the Open Offer to
Qualifying Shareholders) and 1,738,500 New Ordinary Shares shall be issued to
Macquarie and the Optionholders pursuant to the Subscription. All of the
New Ordinary Shares will be issued at the Issue Price.
Shareholders may subscribe for Open Offer Shares on the basis of one Open Offer
Share for every three Existing Ordinary Shares held on the Record Date.
Shareholders subscribing for their full entitlement under the Open Offer may
also request additional New Ordinary Shares through the Excess Application
Facility. The Open Offer is being underwritten by Evolution.
As the Issue Price of the New Ordinary Shares will be less than the nominal
value of the Existing
Ordinary Shares, the Capital Raising is conditional upon, inter alia, a Capital
Reorganisation in order to comply with the 2006 Act and to provide the Company
with flexibility in relation to its capital structure in the future. The Capital
Reorganisation will result in the subdivision and redenomination of the Existing
Ordinary Shares into Redenominated Shares with a nominal value of one penny per
share and Deferred Shares with a nominal value of 29 pence per share.
This letter sets out the reasons for, and provides details of, the new strategy,
the Placing and Open Offer, the Capital Reorganisation and the proposed
arrangements with Macquarie and Optionholders. The Placing and Open Offer, the
amendments to the terms of the Company's Loan Facility with Macquarie, the
cancellation of the Warrants and Options and the Subscription, the Capital
Reorganisation, the proposed Change of Name and adoption of New Articles are
each conditional upon, inter alia, Shareholder approval which will be sought at
the Extraordinary General Meeting to be held at 11.00 a.m. on 30 November 2009,
notice of which is set out at the end of this document.
2. Information on Meridian Petroleum plc
Meridian Petroleum plc is a UK AIM listed oil and gas company, currently with
production in Louisiana USA, and with significant exploration opportunities in
South Australia. The Company is seeking to fundamentally overhaul its strategy
from the proceeds of the Capital Raising and the introduction of a strategic
investor, as further detailed in this document.
Further information on Meridian Petroleum plc's existing strategy, current
assets, reserves and resources and financial reports, inter alia, can be found
on the Company's website, www.meridianpetroleum.com.
3. Background to and reasons for the Capital Raising
The Company currently generates cash from producing US wells and has significant
prospectivity in South Australia. Although attractive, this is a limited asset
portfolio and to create value on a major scale and transform the Company into a
significant independent explorer and producer will require the acquisition of
further good quality assets.
Conditional on completion of the Capital Raising, the Board has now secured
access to substantial equity finance and intends to add reserves, resources and
production capability on a scale large enough to achieve the critical mass of a
mid-cap oil and gas company. The Board will develop this strategy globally and
will seek a strategic presence in key areas of interest in fast
growing hydrocarbon provinces.
The available finance will also allow the Company to progress the drilling
programme on PEL 82 in Australia, although the preference remains to work with a
good quality partner.
Macquarie is fully supportive of the Company and its strategy with the existing
finance facility of US$50 million, of which US$35 million remains available for
acquisitions.
The combination of institutional investors with the capability to fund rapid
growth and the Macquarie Loan Facility has opened up the potential for material
acquisitions and deals. The strong industry background of the new investors,
particularly LCM, and Macquarie is expected to provide deal opportunities in the
target areas and the Board believes that this will give the Company an advantage
relative to its peer group.
LCM is the private investment fund of Peter Levine, founder and former Chairman
of Imperial Energy Corporation PLC. LCM invests in a range of both public and
private securities and assets, with an emphasis on natural resources and will
become a strategic investor in Meridian Petroleum plc. As part of the Placing,
LCM will subscribe for GBP3.4 million worth of shares equating to 13,633,947
Placing Shares at the Issue Price.
4. Board changes
It is proposed that Dr. Michael Cochran will be appointed to the Board as
Exploration Director immediately following Admission. It is also proposed that
John Hamilton and Christopher Hopkinson will be appointed as Non-executive
Directors immediately following Admission.
Dr. Michael Cochran is Senior Technical Adviser to LCM UK, and has over 40 years
experience of the oil and gas business. Previously he was Senior Vice-President,
Strategy and Planning and Head of Worldwide Exploration for Anadarko Petroleum
Corporation. Prior to his time at Anadarko, Michael was with Gulf Oil Company in
Africa, South America and the US.
John Hamilton is Managing Director of LCM UK and was previously Group Finance
Director of Imperial Energy Corporation PLC, the Russia-focused oil exploration
and production company which was acquired by the Indian state-owned energy firm,
Oil and Natural Gas Corporation Limited, for US$2 billion in January 2009. Prior
to joining Imperial Energy, John held senior positions at ABN AMRO.
Christopher Hopkinson is vice president of Western Siberian Division of TNK-BP.
After 13 years with Shell, Chris held Senior appointments in Yukos and Lukoil,
and prior to his current role, was Chief Executive Officer of Imperial Energy.
Further information on Dr. Michael Cochran, John Hamilton and Christopher
Hopkinson can be found in paragraph 4 of Part V of this document.
Peter Clutterbuck, current Non-executive Director, has decided to step down from
the Board at the time of Admission so as to avoid potential conflict with his
other business interests.
The Company intends to strengthen the Board and management further in due
course.
5. Agreement with Macquarie in respect of Loan Facility and Subscription for New
Ordinary Shares
The Company has reached agreement with Macquarie to restructure the Loan
Facility, conditional on completion of the Capital Raising. In particular, the
Company proposes to make an early repayment of US$2.5 million, of which
US$500,000 will be met from the Company's existing cash resources and US$2
million from the proceeds of the Capital Raising. In consideration for such
early repayment, Macquarie has agreed to amend the terms of the Facility
Agreement, such that:
a) the financial covenants given by the Company in relation to the adjusted
present value ratio to net debt of the Group and minimum production levels shall
no longer apply;
(b) the Company shall no longer be under an obligation to issue any further
warrants under the terms of the Facility Agreement or otherwise;
(c) an obligation on the Company to apply certain monies paid into a proceeds
account under the Facility Agreement towards general and administrative expenses
shall no longer apply; and
(d) the general undertakings to deliver net profit overriding royalty interest
conveyances granted in favour of Macquarie shall no longer apply.
In addition, Macquarie has also agreed, as part of these arrangements, to cancel
all of the outstanding Warrants it holds over the Existing Ordinary Shares in
the Company in consideration for the payment by the Company to Macquarie of the
sum of GBP300,000. Macquarie has also agreed, pursuant to the Subscription, to
subscribe in cash for 1,200,000 New Ordinary Shares at the time of the Capital
Raising at the Issue Price.
6. Agreement with Optionholders in respect of Options and Subscription for New
Ordinary Shares
The Company has also reached agreement with the Optionholders to cancel all of
their outstanding Options over a total of 1,579,997 Existing Ordinary Shares,
conditional on completion of the Capital Raising. The Company has obtained
independent advice on the valuation of the Options based on the arrangements
concluded with Macquarie in respect of the Warrants issued to Macquarie. On that
basis, pursuant to the Subscription, a cash consideration will be paid
to Optionholders in respect of each such cancellation. The Optionholders have
separately agreed, pursuant to the Subscription, to subscribe in cash for
538,500 New Ordinary Shares at the time of the Capital Raising at the Issue
Price.
7. Change of Name
The extent of the changes to the Company's strategy, funding and Board announced
today represents a comprehensive transformation for the Company and its
prospects. The Board believes that it is important to strongly emphasise these
changes to external parties such as investors, partners, suppliers, competitors
and others, and is therefore proposing a change of the name of the Company to
President Petroleum Company PLC.
8. Current Trading and Prospects
As detailed in the Company's interim results for the 6 month period ended 30
June 2009, announced on 24 September 2009, the Company is experiencing a much
more challenging environment in comparison to 2008, with lower energy prices,
particularly for US natural gas, and lower production levels. However, with
strong gains on the Company's hedging contracts and tight control of costs, the
Company's operations continue to be cash generative. More recently, the Company
announced on 14 October 2009 that the planned work programme at East Lake Verret
Field, Louisiana, USA (involving well work-overs and changes to the production
streams) had been successfully concluded, with all wells back on stream and
ahead of schedule.
The full interim report, for the 6 months ended 30 June 2009 and the audited
accounts for the year ended 31 December 2008, as well as further information on
the Company and regulatory announcements, can be found on Meridian's website,
www.meridianpetroleum.com/investors.html.
As announced earlier today, the Company intends to implement a fundamental
overhaul of its strategy, with the objective of becoming a mid-cap independent
exploration and production company with much greater financial, technical and
management capability. Under the new name of President Petroleum Company PLC,
using the financial strength provided by the net proceeds of the Capital Raising
and the significant investor and banking support available, the Company will
shift its geographic focus to areas with much greater potential for
major hydrocarbon discoveries. The Board expects to complement the Company's
existing prospects in Australia with other similar sized opportunities in such
diverse areas as Asia, Africa and Eastern Europe.
9. Details of the Placing and Open Offer and Capital Reorganisation
9.1 Structure
The Directors have given consideration as to the best way to structure the
proposed equity fundraising, having regard to current market conditions, the
composition of the Company's Shareholder register, the level of the Company's
share price and the importance of pre-emption rights to Shareholders. After
considering these factors, the Directors have concluded that the structure of
the fund raising by way of the Placing and Open Offer is the most
suitable option available to the Company and its Shareholders as a whole. The
Open Offer provides an opportunity for all Qualifying Shareholders to
participate in the fundraising by acquiring Open Offer Shares pro rata to their
current holdings of Existing Ordinary Shares.
The Issue Price of 25 pence per New Ordinary Share represents a 52.83 per cent.
discount to the closing middle market price of 53 pence per Existing Ordinary
Share on 29 October 2009, the last business day before the announcement of the
Capital Raising.
The Capital Reorganisation does not affect the number of Open Offer Shares to
which a Qualifying Shareholder is entitled under the Open Offer.
9.2 Principal terms of the Placing
The Company is proposing to raise approximately GBP5.6 million (before expenses)
pursuant to the Placing through the issue of 22,250,000 Placing Shares. All of
the Placing Shares have been placed firm with institutions and other investors
and are not, therefore, being offered to existing Shareholders. The Placing
Shares will, upon issue, rank pari passu with the Redenominated Shares in issue
following the Capital Reorganisation and the New Ordinary Shares to be
issued pursuant to the Open Offer and the Subscription.
The Placing Shares are not being offered to Shareholders and therefore do not
form part of the Open Offer.
Of the 22,250,000 Placing Shares to be issued pursuant to the Placing, a total
of 13,633,947 Placing Shares shall be subscribed for by LCM. These Placing
Shares will represent 29.99 per cent. of the Enlarged Share Capital immediately
following Admission.
The Company has appointed Evolution as its agent to use its reasonable
endeavours to procure subscribers for the Placing Shares at the Issue Price.
Further terms of the Placing Agreement are set out in paragraph 6 of Part V of
this document.
9.3 Principal terms of the Open Offer
Subject to the fulfilment of the conditions set out below and in Part IV of this
document, Qualifying Shareholders are being given the opportunity to subscribe
for the Open Offer Shares at a price of 25 pence per Open Offer Share, pro rata
to their holdings of Existing Ordinary Shares on the Record Date on the basis
of:
1 Open Offer Share for every 3 Existing Ordinary Shares
Qualifying Shareholders are also being given the opportunity, provided they take
up their Open Offer Entitlement in full, to apply for Excess Shares through the
Excess Application Facility, up to a maximum number of Excess Shares equal to
the number of Existing Ordinary Shares held in such Qualifying Shareholder's
name as at the Record Date.
All of the 5,364,498 Open Offer Shares being offered to Qualifying Shareholders
have been underwritten by Evolution. Accordingly, in the event that all of the
Open Offer Shares are not subscribed for by Shareholders then the Open Offer
Shares will be subscribed for by Evolution at the Issue Price.
The Open Offer Shares will, upon issue, rank pari passu with the Redenominated
Shares in issue following the Capital Reorganisation, the Placing Shares to be
issued pursuant to the Placing and the New Ordinary Shares to be issued pursuant
to the Subscription.
Fractions of Open Offer Shares will not be allotted, each Qualifying
Shareholder's entitlement under the Open Offer being rounded down to the nearest
whole number. The fractional entitlements will be aggregated and subscribed for
by Evolution with the proceeds being retained for the benefit of the Company.
Qualifying Shareholders may apply for any number of Open Offer Shares up to
their maximum entitlement which, in the case of Qualifying non-CREST
Shareholders, is equal to the number of Open Offer Entitlements as shown in Box
2 on their Application Form or, in the case of Qualifying CREST Shareholders, is
equal to the number of Open Offer Entitlements standing to the credit of their
stock account in CREST. Qualifying Shareholders with holdings of
Existing Ordinary Shares in both certificated and uncertificated form will be
treated as having separate holdings for the purpose of calculating the Open
Offer Entitlements.
9.4 Excess Application Facility
The Excess Application Facility will enable Qualifying Shareholders, provided
they take up their Open Offer Entitlement in full, to apply for Excess Open
Offer Entitlements, up to a maximum number of Excess Shares equal to the same
number of Existing Ordinary Shares held in such Qualifying Shareholder's name as
at the Record Date, subject to availability. Qualifying non-CREST Shareholders
who wish to apply to acquire more than their basic Open Offer Entitlement should
complete the relevant sections on the Application Form. Qualifying CREST
Shareholders will have Excess CREST Open Offer Entitlements credited to their
stock account in CREST and should refer to paragraph 4.2 of Part IV of this
document for information on how to apply for Excess Shares pursuant to the
Excess Application Facility. Applications for Excess Open Offer Entitlements
will be satisfied only and to the extent that corresponding applications
by other Qualifying Shareholders are not made or are made for less than their
basic Open Offer Entitlements. If applications under the Excess Application
Facility are received for more than the total number of Open Offer Shares
available following take up of Open Offer Entitlements, such applications will
be scaled back pro rata to the number of Excess Shares applied for by Qualifying
Shareholders under the Excess Application Facility.
Application will be made for the Open Offer Entitlements (in respect of
Qualifying CREST Shareholders) and Excess Open Offer Entitlements to be admitted
to CREST. It is expected that such Open Offer Entitlements and Excess Open Offer
Entitlements will be admitted to CREST at 8.00 a.m. on 3 November 2009. Such
Open Offer Entitlements and Excess Open Offer Entitlements will also be enabled
for settlement in CREST at 8.00 a.m. on 3 November 2009. Applications through
the means of the CREST system may only be made by the Qualifying Shareholder
originally entitled or by a person entitled by virtue of a bona fide market
claim.
Qualifying non-CREST Shareholders will have received an Application Form with
this document which sets out their maximum entitlement to Open Offer Shares as
shown by the number of Open Offer Entitlements allocated to them. Qualifying
CREST Shareholders will receive a credit to their appropriate stock accounts in
CREST in respect of their Open Offer Entitlements on 3 November 2009.
Shareholders should note that the Open Offer is not a rights issue. Qualifying
CREST Shareholders should note that although the Open Offer Entitlements and
Excess Open Offer Entitlements will be admitted to CREST and be enabled for
settlement, applications in respect of entitlements under the Open Offer may
only be made by the Qualifying Shareholder originally entitled or by a person
entitled by virtue of a bona fide market claim. Qualifying non-CREST
Shareholders should note that the Application Form is not a negotiable document
and cannot be traded. Qualifying Shareholders should be aware that in the Open
Offer, unlike in a rights issue, any Open Offer Shares not applied for will not
be sold in the market or placed for the benefit of Qualifying Shareholders who
do not apply under the Open Offer, but will be subscribed for by Evolution for
the benefit of the Company.
Further information on the Open Offer and the terms and conditions on which it
is made, including the procedure for application and payment, are set out in
Part IV of this document.
For Qualifying non-CREST Shareholders, completed Application Forms, accompanied
by full payment, should be returned by post to Equiniti Limited, Aspect House,
Spencer Road, Lancing, West Sussex, BN99 6DA or by hand (during normal business
hours only) to Equiniti Limited, Corporate Actions, Holm Oak, Holm Oak Business
Park, Goring By Sea, Worthing, West Sussex BN12 4FE so as to arrive as soon as
possible and in any event so as to be received no later than 11.00 a.m. on 27
November 2009. For Qualifying CREST Shareholders the relevant CREST instructions
must have been settled as explained in this document by no later than 11.00
a.m. on 27 November 2009.
In view of the disruptions currently affecting postal services throughout
England, Shareholders are advised to complete and return their Forms of Proxy
and, where relevant, their Application Forms as soon as possible and, in any
event, so as to be received by Equiniti Limited at the above address by no later
than as detailed in the expected timetable of principal events on page 6 of this
document.
9.5 Other information relating to the Capital Raising
The Placing and Open Offer are conditional, inter alia, upon:
(i) the passing of Resolutions;
(ii) Admission becoming effective by not later than 8.00 a.m. on 1 December 2009
(or such later time and/or date as Evolution may agree, not being later than
8.00 a.m. on 8 December 2009); and
(iii) the Placing Agreement becoming unconditional in all respects and not
having been terminated in accordance with its terms prior to Admission.
Accordingly, if any of such conditions are not satisfied, or, if applicable,
waived, the Capital Raising will not proceed and any Open Offer Entitlements
credited to CREST will thereafter be disabled.
A summary of the principal terms of the Placing Agreement is set out in
paragraph 6 of Part V of this document.
The Placing and Open Offer will result in the issue of an aggregate 27,614,498
New Ordinary Shares and a further 1,738,500 New Ordinary Shares are to be issued
pursuant to the Subscription (representing, in aggregate, approximately 64.59
per cent. of the Enlarged Share Capital immediately following completion of the
Proposals). The New Ordinary Shares, when issued and fully paid, will rank pari
passu in all respects with the Redenominated Shares following the Capital
Reorganisation, with such New Ordinary Shares ranking equally for all dividends
or other distributions declared, made or paid after the date of issue of the New
Ordinary Shares. No temporary documents of title will be issued.
Application will be made to the London Stock Exchange for the New Ordinary
Shares and the Redenominated Shares to be admitted to trading on AIM. It is
expected that Admission will become effective on 1 December 2009 and that
dealings for normal settlement in the Redenominated Shares and the New Ordinary
Shares will commence at 8.00 a.m. on 1 December 2009.
Following the creation of the Redenominated Shares pursuant to the Capital
Raising, Qualifying Shareholders who take up their full entitlements, excluding
any New Ordinary Shares acquired through the Excess Application Facility, in
respect of the Open Offer will suffer a dilution of up to 52.78 per cent. to
their interests in the Company because of the Placing and the
Subscription. Qualifying Shareholders who do not take up any of their
entitlements in respect of the Open Offer will suffer a more substantial
dilution of approximately 64.59 per cent. to their interests in the Company
because of the Capital Raising and the Subscription.
9.6 The Capital Reorganisation
Reasons for the Capital Reorganisation
It is proposed that the Capital Raising will be undertaken at 25 pence per New
Ordinary Share, which is less than the current nominal value of an Existing
Ordinary Share. Under the 2006 Act, it is not permissible to issue shares at a
discount to their nominal value. In order to enable the Company to proceed with
the Capital Raising and to provide the Company with flexibility in relation to
its capital structure in the future, the Capital Raising is conditional on,
inter alia, the completion of the Capital Reorganisation, which will result in
the nominal value of each Existing Ordinary Share being reduced to one penny.
Information about the Capital Reorganisation
It is proposed that each of the Existing Ordinary Shares of 30 pence each shall
be subdivided and reclassified into one Redenominated Share (being an ordinary
share in the capital of the Company of one penny nominal value) and one Deferred
Share (being a deferred share in the capital of the Company of 29 pence nominal
value).
The rights attaching to the Redenominated Shares will, save for the change in
nominal value, be identical in all respects to the Existing Ordinary Shares.
No new share certificates will be issued in respect of the Redenominated Shares
and existing share certificates for Existing Ordinary Shares will remain valid
for the New Ordinary Shares arising after the subdivision and reclassification.
The Deferred Shares created pursuant to the Capital Reorganisation will have no
voting or dividend rights. A summary of the key rights attaching to the Deferred
Shares is set out in paragraph 5.3 of Part V.
Likewise, no share certificates will be issued in respect of the Deferred
Shares, nor will CREST accounts of Shareholders be credited in respect of any
entitlement to Deferred Shares, nor will they be admitted to trading on AIM or
any other investment exchange. It is the Board's intention, at the appropriate
time, to effect a repurchase of the Deferred Shares, to make an application
to the High Court for the Deferred Shares to be cancelled or for the Company to
cancel the Deferred Shares using such other lawful means as the Directors may
from time to time determine.
The effect of the Capital Reorganisation will mean that each Redenominated Share
will have a nominal value of one penny each. Ignoring the effect of the Capital
Raising, the number of ordinary shares of the Company admitted to trading on AIM
would otherwise remain the same. Consequently, the market price of a
Redenominated Share immediately after completion of the Capital Reorganisation
should, theoretically, be the same as the market price of an Existing Ordinary
Share immediately prior to the Capital Reorganisation.
The Capital Reorganisation is conditional upon the passing of the Resolutions.
10. Extraordinary General Meeting
A notice convening an Extraordinary General Meeting of the Company, to be held
at the offices of Grant Thornton UK LLP, 30 Finsbury Square, London, on 30
November 2009 at 11.00 a.m. is set out at the end of this document. At the
Extraordinary General Meeting, the following Resolutions will be proposed:
1. a special resolution to:
a) approve the sub-division into and reclassification of each of the Company's
Existing Ordinary Shares into one Redenominated Share and one Deferred Share
pursuant to the Capital Reorganisation;
b) grant authority to the Directors to allot up to 44,501,828 New Ordinary
Shares in the capital of the Company or to grant rights to subscribe for or
convert any security into shares in the capital of the Company pursuant to
section 551 of the 2006 Act, being up to an aggregate nominal amount of
GBP445,018.28. The Directors will limit this authority to the allotment of New
Ordinary Shares under the Capital Raising and the Subscription and otherwise up
to one third of the Enlarged Share Capital. The authority will expire at the
conclusion of the Annual General Meeting of the
Company to be held in 2010 after the passing of the Resolution;
c) disapply the statutory pre-emption rights contained in section 561(1) of the
2006 Act in respect of the allotment of up to 38,442,296 New Ordinary Shares
being up to an aggregate nominal amount of GBP384,422.96. In addition to the
allotment of the New Ordinary Shares under the Capital Raising and the
Subscription, the Directors are to be given a general disapplication in respect
of the issue of further new ordinary shares which will be in respect of
approximately 20 per cent. of the Enlarged Share Capital. The authority will
expire at the conclusion of the Annual General Meeting of the Company to be held
in 2010 after the passing of the Resolution;
d) change the Company's name to President Petroleum Company PLC; and
2. a special resolution to adopt the New Articles in substitution of the
Existing Articles, to take advantage and account of the 2006 Act relating, inter
alia, to electronic communications, disclosure of interests in shares,
directors' duties, shareholder meetings and proxies. Further details of the
provisions of the New Articles are set out in paragraph 5 of Part V.
11. Action to be taken
11.1 Extraordinary General Meeting
Shareholders will find accompanying this document a Form of Proxy for use at the
Extraordinary General Meeting. Whether or not you intend to be present at the
Extraordinary General Meeting, you are requested to complete, sign and return
the Form of Proxy in accordance with the instructions printed on it to Equiniti
Limited, Aspect House, Spencer Road, Lancing, West Sussex, BN99 6ZL as soon as
possible and, in any event, so as to arrive no later than 11.00 a.m. on 28
November 2009. Completion and return of the Form of Proxy will not affect your
right to attend and vote in person at the Extraordinary General Meeting if you
so wish.
11.2 Open Offer
Qualifying non-CREST Shareholders
If you are a Qualifying non-CREST Shareholder you will have received an
Application Form which gives details of your maximum entitlement under the Open
Offer (as shown by the number of Open Offer Entitlements allocated to you). If
you wish to apply for Open Offer Shares under the Open Offer (whether in respect
of your basic Open Offer Entitlement or both your basic Open Offer Entitlement
and any Excess Open Offer Entitlements), you should complete the accompanying
Application Form in accordance with the procedure for application set out
in paragraph 4.1 of Part IV of this document and on the Application Form itself.
Qualifying CREST Shareholders
If you are a Qualifying CREST Shareholder, no Application Form accompanying this
document and you will receive a credit to your appropriate stock account in
CREST in respect of the Open Offer Entitlements representing your maximum
entitlement under the Open Offer except (subject to certain exceptions) if you
are an Overseas Shareholder who has a registered address in, or is a resident in
or a citizen of an Excluded Territory. Applications by Qualifying
CREST Shareholders for Excess Open Offer Entitlements in excess of their basic
Open Offer Entitlements should be made in accordance with the procedures set out
in paragraphs 4.2(c) and 4.2(j) of Part IV of this document.
The latest time for applications under the Open Offer to be received is 11.00
a.m. on 27 November 2009. The procedure for application and payment depends on
whether, at the time at which application and payment is made, you have an
Application Form in respect of your entitlement under the Open Offer or have
Open Offer Entitlements credited to your stock account in CREST in respect of
such entitlement. The procedures for application and payment are set out in
Part IV of this document.
Qualifying CREST Shareholders who are CREST sponsored members should refer to
their CREST sponsors regarding the action to be taken in connection with this
document and the Open Offer.
12. Overseas Shareholders
Information for Overseas Shareholders who have registered addresses outside the
United Kingdom, who are citizens or residents of countries other than the United
Kingdom or who are US persons, appears in paragraph 6 of Part IV of this
document, which sets out the restrictions applicable to such persons. If you are
an Overseas Shareholder, it is important that you read that part of this
document.
13. Additional Information
You attention is drawn to the additional information set out in Part II to V
(inclusive) of this document.
14. Directors' recommendation
The Directors consider the Proposals to be in the best interests of the Company
and its Shareholders as a whole.
Accordingly the Directors unanimously recommend that Shareholders vote in favour
of the Resolutions to be proposed at the Extraordinary General Meeting as they
intend to do in respect of their own beneficial holdings of Existing Ordinary
Shares amounting, in aggregate, to 504,364 Existing Ordinary Shares,
representing approximately 3.13 per cent. of the existing issued ordinary share
capital of the Company.
Yours sincerely
Stephen Gutteridge
Chairman
DIRECTORS AND ADVISERS
Directors
Stephen Gutteridge (Chairman)
Angelo Karunalingam Baskaran (Finance Director)
Peter Richard Clutterbuck (Non-executive Director)
David Christopher Wake-Walker (Non-executive Director)
all of:
13 Regent Street
London SW1Y 4LR
(which is the registered office of the Company)
Proposed Directors
John Andrew Hamilton (Proposed Non-executive Director)
Michael David Cochran (Proposed Exploration Director)
Simon Christopher Hopkinson (Proposed Non-executive Director)
Company Secretary
David Wake-Walker
Nominated Adviser and Broker
Evolution Securities Limited
100 Wood Street
London EC2V 7AN
Legal Advisers to the Company
Field Fisher Waterhouse LLP
35 Vine Street
London EC3N 2AA
Legal Advisers to Evolution
Osborne Clarke
One London Wall
London EC2Y 5EB
Registrars and Receiving Agent for the Open Offer
Equiniti Limited
Aspect House
Spencer Road
Lancing
West Sussex BN99 6DA
CAPITAL RAISING STATISTICS
+----------------------------------------------+--------------------------+
| Issue Price for each New Ordinary Share | 25 pence |
+----------------------------------------------+--------------------------+
| Basis of Open Offer | 1 New Ordinary Share for |
| | every 3 Existing |
| | Ordinary Shares |
+----------------------------------------------+--------------------------+
| Basis of Excess Open Offer Entitlement | 1 New Ordinary Share for |
| (subject to scale back) | every 1 Existing |
| | Ordinary Share |
+----------------------------------------------+--------------------------+
| Number of Existing Ordinary Shares in issue | 16,093,494 |
| as at the date of this Circular | |
+----------------------------------------------+--------------------------+
| Number of New Ordinary Shares to be issued | 22,250,000 |
| pursuant to the Placing | |
+----------------------------------------------+--------------------------+
| Number of New Ordinary Shares to be issued | 5,364,498 |
| pursuant to the Open Offer | |
+----------------------------------------------+--------------------------+
| Number of New Ordinary Shares to be issued | 1,738,500 |
| pursuant to the Subscription | |
+----------------------------------------------+--------------------------+
| Number of Redenominated Shares and New | 45,446,492 |
| Ordinary Shares in issue immediately | |
| following completion of the Capital Raising | |
+----------------------------------------------+--------------------------+
| New Ordinary Shares as a percentage of the | 64.59% |
| Enlarged Share Capital | |
+----------------------------------------------+--------------------------+
| Estimated net proceeds of the Capital | GBP6.7m |
| Raising | |
+----------------------------------------------+--------------------------+
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
+------------------------------------------------------+------------------+
| | 2009 |
+------------------------------------------------------+------------------+
| Record Date for the Open Offer | close of |
| | business on 28 |
| | October |
+------------------------------------------------------+------------------+
| Announcement of the Proposals | 30 October |
+------------------------------------------------------+------------------+
| Posting of the Circular, Forms of Proxy and, to | 2 November |
| Qualifying non-CREST Shareholders only, the | |
| Application Forms | |
+------------------------------------------------------+------------------+
| Open Offer Entitlements and Excess CREST Open Offer | 8.00 a.m. on 3 |
| Entitlements credited to stock accounts in CREST of | November |
| Qualifying CREST Shareholders | |
+------------------------------------------------------+------------------+
| Latest recommended time and date for requesting | 4.30 p.m. on 23 |
| withdrawal of Open Offer Entitlements and Excess | November |
| CREST Open Offer Entitlements from CREST | |
+------------------------------------------------------+------------------+
| Latest time for depositing Open Offer Entitlements | 3.00 p.m. on 24 |
| and Excess CREST Open Offer Entitlements into CREST | November |
+------------------------------------------------------+------------------+
| Latest time and date for splitting Application Forms | 3.00 p.m. on 25 |
| (to satisfy bona fide market claims) | November |
+------------------------------------------------------+------------------+
| Latest time and date for receipt of completed | 11.00 a.m. on 27 |
| Application Forms and payment in full under the Open | November |
| Offer or settlement of relevant CREST instruction | |
| (as appropriate) | |
+------------------------------------------------------+------------------+
| Latest time and date for receipt of Forms of Proxy | 11.00 a.m. on 28 |
| | November |
+------------------------------------------------------+------------------+
| Expected time and date of announcement of results of | 7.00 a.m. on 30 |
| the Placing and Open Offer | November |
+------------------------------------------------------+------------------+
| Extraordinary General Meeting | 11.00 a.m. on 30 |
| | November |
+------------------------------------------------------+------------------+
| Expected time of announcement of results of the | by 4.30 p.m. on |
| Extraordinary General Meeting | 30 November |
+------------------------------------------------------+------------------+
| Capital Reorganisation implemented | by 5.00 p.m. on |
| | 30 November |
+------------------------------------------------------+------------------+
| Admission and dealings in the Redenominated Shares | 8.00 a.m. on 1 |
| and the New Ordinary Shares commence | December |
+------------------------------------------------------+------------------+
| Expected date for crediting of New Ordinary Shares | 8.00 a.m. on 1 |
| in uncertificated form to CREST stock accounts | December |
+------------------------------------------------------+------------------+
| Expected date of despatch of share certificates in | 7 December |
| respect of New Ordinary Shares in certificated form | |
+------------------------------------------------------+------------------+
Notes:
(1) If you have any questions on the procedure for acceptance and payment, you
should contact Equiniti Limited, Aspect House, Spencer Road, Lancing, West
Sussex, BN99 6DA, telephone: 0871 384 2862 from the UK or +44 121 415 0279 from
overseas. Calls to the 0871 384 2862 number cost 8 pence per minute (including
value added tax) plus your service providers network extras. Calls to the +44
121 415 0279 number will be charged at applicable international rates. Different
charges may apply to calls from mobile telephones. Please note that Equiniti
cannot provide financial advice on the merits of the Capital Raising or as to
whether or not you should take up your entitlement.
(2) The dates set out in the Expected Timetable of Principal Events above and
mentioned throughout this document may be adjusted by Meridian Petroleum plc in
which event details of the new dates will be notified to AIM and, where
appropriate, to Shareholders.
(3) All references to time in this document are to time in London.
(4) In view of the disruptions currently affecting postal services throughout
England, Shareholders are advised to complete and return their Forms of Proxy
and, where relevant, Application Forms to the Company's Registrars, Equiniti
Limited (whose 'details' are set out in Note(1) above) as soon as possible and,
in any event, so as to arrive with them by no later than as detailed in the
expected timetable of principal events, as above.
APPENDIX I
NOTICE OF EXTRAORDINARY GENERAL MEETING
Meridian Petroleum plc
Incorporated and Registered in England and Wales under the Companies Act 1985
with company number: 5104249
NOTICE is hereby given that an Extraordinary General Meeting of Meridian
Petroleum plc (the "Company") will be held at the offices of Grant Thornton UK
LLP, 30 Finsbury Square, London on 30 November 2009 at 11.00 a.m. for the
purpose of considering and, if thought fit, passing the following resolutions as
special resolutions:
Special Resolutions
1. THAT, subject to and conditional on the passing of Resolution 2 below:
(a) each issued ordinary share of 30p each in the capital of the Company as
shown in the Register of Members of the Company at 5.00 p.m. on 30 November 2009
(or such other time and/or date as the Directors of the Company (the
"Directors") may determine) be sub-divided into and reclassified as one new
ordinary share of 1p ("Redenominated Share") and one deferred share of 29p
("Deferred Share") so as to form one class of Redenominated Shares having the
like rights and ranking pari passu in all respects and one class of Deferred
Shares having the rights set out in the New Articles (as defined below);
(b) the Directors be and they are hereby authorised generally and
unconditionally pursuant to and for the purposes of Section 551 of the Companies
Act 2006 (the "Act") to allot shares in the Company or grant rights to subscribe
for or to convert any security into shares in the Company ("Rights") up to an
aggregate nominal amount of GBP445,018.28 provided that this authority shall
expire at the conclusion of the Annual General Meeting of the Company to be held
in 2010 save that the Company may make an offer or agreement before the expiry
of this authority which would or might require shares to be allotted or Rights
to be granted after such expiry and the Directors may allot shares or grant
Rights pursuant thereto as if the authority conferred hereby had not expired,
such authority to be in substitution for any existing authorities conferred on
the Directors pursuant to Section 80 of the Companies Act 1985;
(c) the Directors be and they are hereby generally empowered pursuant to Section
570 of the Act to allot equity securities (as defined in Section 560 of the Act)
pursuant to the authority conferred by sub-paragraph (b) above as if Section
561(1) of the Act did not apply to any such allotment, provided that this power
shall be in substitution for any previous powers conferred on the Directors
pursuant to Section 95 of the Companies Act 1985 and shall be limited to:
(i) allotments made in connection with offers of equity securities to the
holders of ordinary shares in proportion (as nearly as may be) to the respective
numbers of ordinary shares held by them, but subject to such exclusions or
other arrangements as the Directors may deem necessary or expedient in
relation to fractional entitlements or legal or practical problems under the
laws of any overseas territory or the requirements of any recognised regulatory
body or any stock exchange in any territory; and (ii) the allotment of equity
securities up to an aggregate nominal amount of GBP276,144.98 pursuant to the
Placing and Open Offer (as defined in the circular dated 2 November 2009 of
which this notice forms part ("Circular"));
(iii) the allotment of equity securities in respect of the Subscription (as
defined in the Circular);
(iv) the allotment (otherwise than pursuant to sub-paragraphs (i) to (iii)
above) of further equity securities up to an aggregate nominal amount of
GBP151,488.31, provided that this authority shall expire at the conclusion of
the Annual General Meeting of the Company to be held in 2010 save that the
Company may make an offer or agreement before the expiry of this power which
would or might require equity securities to be allotted after such expiry and
the Directors may allot equity securities pursuant thereto as if the power
conferred hereby had not expired.
(d) the name of the Company be changed to President Petroleum Company PLC.
2. THAT:
(a) the Articles of Association of the Company be amended by deleting all of the
provisions of the Company's Memorandum of Association which, by virtue of
section 28 of the Act are to be treated as provisions of the Company's Articles
of Association; and
(b) the Articles of Association produced to the meeting and initialled by the
chairman of the meeting for the purpose of identification be adopted as the
Articles of Association of the Company in substitution for, and to the exclusion
of, the existing Articles of Association.
By Order of the Board
David Wake-Walker
Secretary
2 November 2009
Registered Office:
13 Regent Street
London SW1Y 4LR
NOTES:
Entitlement to attend and vote
1. Pursuant to Regulation 41 of the Uncertificated Securities Regulations 2001,
the Company has specified that only those members on the register of members of
the Company at 6:00 p.m. on 28 November 2009 (or in the event that this meeting
is adjourned, on the register of members at 6.00 p.m. two days before the time
of any adjourned meeting) shall be entitled to attend and vote at the meeting in
respect of the number of Existing Ordinary Shares registered in their name at
that time. Changes to the register of members after 6:00 p.m. on 28 November
2009 shall be disregarded in determining the rights of any person to attend and
vote at the meeting.
Appointment of proxies
2. A member entitled to be present at the meeting may appoint a proxy or proxies
to exercise all or any of his rights to attend, speak and vote at the EGM and
should have received a proxy form with this notice of meeting. He can only
appoint a proxy using the procedures set out in these notes and the notes to the
proxy form. A proxy need not be a member of the Company. Forms of proxy must be
received by the Registrars not later than 48 hours before the time appointed for
holding the EGM (or any adjournment thereof).
3. Details of how to appoint the Chairman of the Extraordinary General Meeting
or another person as a proxy using the proxy form are set out in the notes to
the proxy form. If a proxy is required to speak on behalf of a member at the EGM
the member will need to appoint his own choice of proxy (not the Chairman) and
give instructions directly to them.
4. More than one proxy may be appointed provided that each proxy is appointed to
exercise rights attached to different shares. More than one proxy may not be
appointed to exercise rights attached to any one share. To appoint more than one
proxy, the proxy form should be photocopied and the name of the proxy to be
appointed indicated on each proxy form together with the number of shares in
respect of which such proxy is appointed. All copies of the proxy form should
then be sent by post to Equiniti Limited, Aspect House, Spencer Road, Lancing,
West Sussex BN99 6ZL.
5. A vote withheld is not a vote in law, which means that the vote will not be
counted in the calculation of votes for or against the resolution. If no voting
indication is given, a proxy will vote or abstain from voting at his or her
discretion. A proxy will vote (or abstain from voting) as he or she thinks fit
in relation to any other matter which is put before the EGM.
Appointment of proxy using hard copy proxy form
6. The notes to the proxy form explain how to direct a proxy how to vote on each
resolution or withhold their vote. To appoint a proxy using the proxy form, the
form must be:
- completed and signed;
- sent or delivered to Equiniti Limited, Aspect House, Spencer Road,
Lancing, West Sussex BN99 6ZL; and
- received by Equiniti Limited no later than 11:00 a.m. on 28 November 2009.
7. In the case of a member which is a company, the proxy form must be executed
under its common seal or signed on its behalf by an officer of the company or an
attorney for the company. Any power of attorney or any other authority under
which the proxy form is signed (or a duly certified copy of such power or
authority) must be included with the proxy form, together with a duly completed
certificate of non-revocation of such power or authority.
Appointment of proxy by joint members
8. In the case of joint holders, where more than one of the joint holders
purports to appoint a proxy, only the appointment submitted by the most senior
holder will be accepted. Seniority is determined by the order in which the names
of the joint holders appear in the Company's register of members in respect of
the joint holding (the first-named being the most senior).
Changing proxy instructions
9. To change proxy instructions it is necessary to submit a new proxy
appointment using the methods set out above.
10. Where a proxy has been appointed using the hard copy proxy form and the
member would like to change the instructions using another hard copy proxy form,
Equiniti Limited should be contacted.
11. If more than one valid proxy appointment is submitted, the appointment
received last before the latest time for the receipt of proxies will take
precedence.
Termination of proxy appointments
12. In order to revoke a proxy instruction the Company will need to be informed.
A signed hard copy notice clearly stating the intention to revoke the proxy
appointment should be sent to Equiniti Limited, Aspect House, Spencer Road,
Lancing, West Sussex BN99 6ZL.
13. In the case of a member which is a company, the revocation notice must be
executed under its common seal or signed on its behalf by an officer of the
company or an attorney for the company. Any power of attorney or any other
authority under which the revocation notice is signed (or a duly certified copy
of such power or authority) must be included with the revocation notice together
with a duly completed certificate of non-revocation of such power or authority.
14. The revocation notice must be received by Equiniti Limited by no later than
11:00 a.m. on 30 November 2009. If there is an attempt to revoke a proxy
appointment but the revocation is received after the time specified then,
subject to the paragraph directly below, the proxy appointment will remain
valid.
15. Completion of a form of proxy will not preclude a member from attending and
voting in person. If a member has appointed a proxy and attends the EGM in
person, the proxy appointment will automatically be terminated.
Communication
16. Members who have general queries about the EGM should use the following
means of communication (no other methods of communication will be accepted):
- calling the Company's Registered Office on +44 (0) 20 7811 0140;
- in writing to the Company by fax to +44 (0) 20 7811 0141.
Any electronic address provided either:
- in this Notice of Extraordinary General Meeting; or
- in any related documents (including the Executive Chairman's letter and proxy
form) may not be used to communicate with the Company for any purposes other
than those expressly stated.
Nominated persons
17. A person who has been nominated under section 146 of the Companies Act 2006
to enjoy information rights (Nominated Person) may have a right under an
agreement between him and the member of the Company who has nominated him to
have information rights ("Relevant Member") to be appointed or to have someone
else appointed as a proxy for the EGM.
- If he either does not have such a right or if he has such a right but does not
wish to exercise it, he may have a right under an agreement between you and
the Relevant Member to give instructions to the Relevant Member as to the
exercise of voting rights.
- The main point of contact in terms of his investment in the Company remains
the Relevant Member (or, perhaps, his custodian or broker) and he should
continue to contact them (and not the Company) regarding any changes or queries
relating to personal details and his interest in the Company (including any
administrative matters). The only exception to this is where the Company
expressly requests a response from him.
APPENDIX II
5. Details of New Articles to be adopted
A special resolution will be proposed to adopt the New Articles to take
advantage and account of the 2006 Act relating, inter alia, to electronic
communications, disclosure of interests in shares, Directors' duties,
shareholder meetings and proxies.
A copy of the New Articles is available on the Company's website and also for
inspection during normal business hours at the registered office of the Company
until the date of the EGM or upon request of the Company Secretary. Copies will
also be available at the EGM until its conclusion.
The material differences between the Existing Articles and the New Articles are
summarised below. Changes of a minor, conforming or purely technical nature have
not been mentioned specifically.
5.1 The Company's objects
The provisions regulating the operations of the Company are currently set out in
the Company's memorandum and articles of association. The Company's
memorandum contains, inter alia, the objects clause which sets out the scope of
the activities the Company is authorised to undertake. This is drafted to give a
wide scope.
The 2006 Act significantly reduces the constitutional significance of a
company's memorandum. The 2006 Act provides that a memorandum will record only
the names of subscribers and the number of shares each subscriber has agreed to
take in the company. Under the 2006 Act, the objects clause and all other
provisions which are contained in a company's memorandum, for existing companies
at 1 October 2009, are deemed to be contained in the Company's articles of
association but the company can remove these provisions by special resolution.
Furthermore, the 2006 Act states that unless a company's articles of association
provide otherwise, a company's objects are unrestricted. This abolishes the need
for companies to have objects clauses. For this reason the Company is proposing
to remove its objects clause together with all other provisions of its
memorandum which, by virtue of the 2006 Act, are treated as forming part of the
Company's articles of association as of 1 October 2009. Resolution 2(a) confirms
the removal of these provisions for the Company. As the effect of this
resolution will be to remove the statement currently in the Company's memorandum
of association regarding limited liability, the New Articles also contain an
express statement regarding the limited liability of shareholders.
5.2 Authorised share capital and unissued shares
The 2006 Act abolishes the requirement for a company to have an authorised share
capital and the New Articles reflect this. Directors will still be limited as to
the number of shares they can at any time allot because allotment authority
continues to be required under the 2006 Act, save in respect of employee share
schemes.
5.3 Deferred Shares
The special rights and restrictions attaching to the Deferred Shares will be as
follows:
(a) as regards income: the Deferred Shares shall not entitle the holders thereof
to receive any dividend or other distribution;
(b) as regards voting: the Deferred Shares shall not entitle the holders thereof
to receive notice of or to attend or vote at any general meeting of the Company;
(c) as regards capital: on a return of capital on a winding up the holders of
Deferred Shares shall only be entitled to receive the amount paid up on such
shares after the holders of the ordinary shares in the Company have received the
sum of GBP10,000,000 for each ordinary share held by them and shall have no
other right to participate in the assets of the Company; the Deferred Shares are
liable to be cancelled without payment of any consideration to the holders
thereof;
(d) as regards transfers: the Deferred Shares shall not be transferable without
the consent of the Directors of the Company; the Company is authorised at any
time:
(i) to appoint any person to execute on behalf of the holders of the Deferred
Shares a transfer thereof and/or an agreement to transfer the same (without
making any payment to the holders thereof and persons so entitled) to such
persons as the Company may determine as holders thereof beneficially entitled
thereto;
(ii) pending any such transfer not to issue certificates for the Deferred
Shares;
(e) as regards variation of rights: neither:
(i) the passing by the Company of any resolution for a reduction of capital
involving the cancellation of the Deferred Shares without any repayment of
capital in respect thereof, or a reduction of share premium account, or the
obtaining by the Company or the making by the Court of an order confirming any
such reduction of capital or share premium account or the making effective of
such order; nor
(ii) the purchase by the Company in accordance with the provisions of
applicable legislation of any of its own shares or other securities or the
passing of a resolution to permit any such purchase shall constitute a variation
of rights; and
(f) as regards further issues: the rights conferred by the Deferred Shares shall
not be varied or abrogated by the creation or issue of further shares ranking
pari passu with or in priority to the Deferred Shares.
5.4 Voting by and appointment of proxies
The 2006 Act provides that each proxy appointed by a member has one vote on a
show of hands, unless the proxy is appointed by more than one member in which
case the proxy has one vote for and one vote against if the proxy has been
instructed by one or more members to vote for the resolution and by one or more
members to vote against the resolution. The New Articles remove provisions in
the Existing Articles that only permitted members personally present at the
meeting (or, being a corporation, present by a duly appointed representative) to
have a vote on a show of hands and therefore effectively precluded
proxies voting on a show of hands. The New Articles also permit members to
appoint more than one proxy to attend on the same occasion and appoint different
proxies to exercise the rights attaching to different shares held by that
member.
5.5 Voting by corporate representatives
The 2006 Act enables multiple representatives to be appointed by the same
corporate member and to vote in different ways on a show of hands and a poll.
The New Articles contain provisions which permit the appointment of multiple
corporate representatives but do not specifically deal with voting by corporate
representatives on the basis that these are dealt with in the 2006 Act.
5.6 Notice of general meetings
The Existing Articles require the company to give 21 clear days' notice of
general meetings at which a special resolution is proposed. Pursuant to the 2006
Act a company may convene all general meetings which are not annual general
meetings on 14 clear days' notice and the New Articles amend the provisions
applicable to the Company convening general meetings to reflect this.
In addition, the time limits for the appointment or termination of a proxy
appointment have been altered by the 2006 Act so that the articles cannot
provide that they should be received more than 48 hours before the meeting or in
the case of a poll taken more than 48 hours after the meeting, more than 24
hours before the time for the taking of a poll, with weekends and bank holidays
being permitted to be excluded for this purpose. The New Articles reflect all of
these new provisions.
5.7 Conflicts of interest
The 2006 Act sets out directors' general duties which largely codify the
existing law but with some changes. Under the 2006 Act, from 1 October 2008 a
director must avoid a situation where he has, or can have, a direct or indirect
interest that conflicts, or possibly may conflict with the company's interests.
The requirement is very broad and could apply, for example, if a director
becomes a director of another company or a trustee of another organisation. The
2006 Act allows directors of public companies to authorise conflicts
and potential conflicts, where appropriate, where the articles of association
contain a provision to this effect. The 2006 Act also allows the articles of
association to contain other provisions for dealing with directors' conflicts of
interest to avoid a breach of duty. The New Articles give the Directors
authority to approve such situations and to include other provisions to allow
conflicts of interest to be dealt with in a similar way to the current
position.
There are safeguards which will apply when Directors decide whether to authorise
a conflict or potential conflict. First, only Directors who have no interest in
the matter being considered will be able to take the relevant decision, and
secondly, in taking the decision the Directors must act in a way they consider,
in good faith, will be most likely to promote the Company's success. The
Directors will be able to impose limits or conditions when giving authorisation
if they think this is appropriate.
It is also proposed that the New Articles should contain provisions relating to
confidential information, attendance at board meetings and availability of board
papers to protect a Director being in breach of duty if a conflict of interest
or potential conflict of interest arises. These provisions will only apply where
the position giving rise to the potential conflict has previously been
authorised by the Directors.
5.8 Electronic and web communications
Provisions of the 2006 Act which came into force in January 2007 enable
companies to communicate with members by electronic and/or website
communications. The New Articles allow communications to members in electronic
form and, in addition, they also permit the Company to take advantage of the
provisions relating to website communications. Before the Company can
communicate with a member by means of a website communication, the relevant
member must be asked individually by the Company to agree that the Company may
send or supply documents or information to him by means of a website and
the Company must either have received a positive response or have received no
response within the period of 28 days beginning with the date on which the
request was sent. The Company will notify the member (either in writing, or by
other permitted means) when a relevant document or information is placed on the
website and a member can always request a hard copy version of the document or
information.
5.9 Notice of refusal to register transfer and suspension of transfers
Where the Directors refuse to register a transfer of shares, in accordance with
the 2006 Act, the New Articles oblige them to send the transferee notice of
their refusal as soon as practicable and, in any event, within two months after
the date on which the instrument of transfer was lodged with the Company
together with the reasons for the refusal, as required by the 2006 Act.
The Existing Articles permit the Directors to suspend the registration of
transfers. Under the 2006 Act share transfers must be registered as soon as
practicable. The power in the Existing Articles to suspend the registration of
transfers is inconsistent with this requirement. Accordingly, this power has
been removed in the New Articles.
5.10 Directors' indemnities
The 2006 Act has in some areas widened the scope of the powers of a company to
indemnify directors and to fund expenditure incurred in connection with certain
actions against directors. In particular, a company that is a trustee of an
occupational pension scheme can now indemnify a director against liability
incurred in connection with the company's activities as trustee of the scheme.
In addition, the existing exemption allowing a company to provide money for the
purpose of funding a director's defence in court proceedings now expressly
covers regulatory proceedings and applies to associated companies. The
indemnity provisions in the New Articles have been amended to reflect the 2006
Act position.
5.11 Execution of documents
Since 6 April 2008, the 2006 Act has provided for documents (whether they are
simple contracts or deeds) to be executed by a company in one of three ways: (a)
by affixing its common seal; or (b) by a director and secretary of a company or
two directors of a company each signing the document on behalf of the company;
or (c) by the document being signed on behalf of a company by a director in the
presence of a witness who attests the signature. The New Articles reflect these
provisions of the 2006 Act.
APPENDIX III
DEFINITIONS
The following definitions apply throughout this document unless the context
otherwise requires:
+-----------------------------------+------------------------------------------+
| "1985 Act" | the Companies Act 1985 (as amended) |
+-----------------------------------+------------------------------------------+
| "2006 Act" | the Companies Act 2006 |
+-----------------------------------+------------------------------------------+
| "Acts" | the 1985 Act and the 2006 Act |
+-----------------------------------+------------------------------------------+
| "Admission" | the admission of the Redenominated |
| | Shares and the New Ordinary Shares to |
| | trading on AIM |
+-----------------------------------+------------------------------------------+
| "AIM" | AIM, the market of that name operated by |
| | the London Stock Exchange |
+-----------------------------------+------------------------------------------+
| "AIM Rules for Companies" | the AIM rules for Companies, as |
| | published and amended from time to time |
| | by the London Stock Exchange |
+-----------------------------------+------------------------------------------+
| "AIM Rules for Nominated | the rules for nominated advisers to AIM |
| Advisers" | companies, as published and amended from |
| | time to time by the London Stock |
| | Exchange |
+-----------------------------------+------------------------------------------+
| "Applicant" | a Qualifying Shareholder or a person |
| | entitled by virtue of a bona fide market |
| | claim who lodges an Application Form |
| | under the Open Offer |
+-----------------------------------+------------------------------------------+
| "Application Form" | the application form which accompanies |
| | this document for Qualifying non-CREST |
| | Shareholders for use in connection with |
| | the Open Offer |
+-----------------------------------+------------------------------------------+
| "Board" | the board of directors of the Company |
| | from time to time |
+-----------------------------------+------------------------------------------+
| "Business Day" | any day (excluding Saturdays and |
| | Sundays) on which banks are open in |
| | London for normal banking business and |
| | the London Stock Exchange is open for |
| | trading |
+-----------------------------------+------------------------------------------+
| "Capital Raising" | together, the Placing and the Open Offer |
| | details of which are set out in this |
| | document |
+-----------------------------------+------------------------------------------+
| "Capital Reorganisation" | the proposed subdivision and |
| | reclassification of the Company's |
| | Existing Ordinary Shares into |
| | Redenominated Shares and Deferred |
| | Shares, as set out in the Resolutions |
+-----------------------------------+------------------------------------------+
| "CCSS" | the CREST courier and sorting service, |
| | established by Euroclear UK & Ireland to |
| | facilitate, inter alia, the deposit and |
| | withdrawal of certified securities |
+-----------------------------------+------------------------------------------+
| "certificated" or "certificated | not in uncertificated form |
| form" | |
+-----------------------------------+------------------------------------------+
| "Change of Name" | the proposed change of the Company's |
| | name to President Petroleum Company PLC; |
| | such change to be approved pursuant to a |
| | Resolution to be proposed at the EGM |
+-----------------------------------+------------------------------------------+
| "Company" or "Meridian" | Meridian Petroleum plc, and pursuant to |
| | the proposed Change of Name, President |
| | Petroleum Company PLC |
+-----------------------------------+------------------------------------------+
| "CREST" | the relevant system for the paperless |
| | settlement of trades and the holding of |
| | uncertificated securities operated by |
| | Euroclear UK & Ireland in accordance |
| | with the CREST Regulations |
+-----------------------------------+------------------------------------------+
| "CREST member" | a person who has been admitted by |
| | Euroclear UK & Ireland as a |
| | system-member (as defined in the CREST |
| | Regulations) |
+-----------------------------------+------------------------------------------+
| "CREST participant" | a person who is, in relation to CREST, a |
| | system- participant (as defined in the |
| | CREST Regulations) |
+-----------------------------------+------------------------------------------+
| "CREST payment" | shall have the meaning given in the |
| | CREST Manual issued by Euroclear UK & |
| | Ireland |
+-----------------------------------+------------------------------------------+
| "CREST Regulations" | the Uncertified Securities Regulations |
| | 2001, as amended from time to time |
+-----------------------------------+------------------------------------------+
| "CREST sponsor" | a CREST participant admitted to CREST as |
| | a CREST sponsor |
+-----------------------------------+------------------------------------------+
| "CREST sponsored member" | a CREST member admitted to CREST as a |
| | sponsored member (which includes all |
| | CREST Personal Members) |
+-----------------------------------+------------------------------------------+
| "Deferred Shares" | the new deferred shares of 29 pence each |
| | of the Company to be created pursuant to |
| | the Capital Reorganisation |
+-----------------------------------+------------------------------------------+
| "Directors" or "Board" | the directors of the Company at the date |
| | of this document whose names are set out |
| | on page 4 of this document |
+-----------------------------------+------------------------------------------+
| "Disclosure Rules and | the rules made by the FSA under Part VI |
| Transparency Rules" | of FSMA relating to the disclosure of |
| | information (as amended from time to |
| | time) |
+-----------------------------------+------------------------------------------+
| "Enlarged Share Capital" | the issued ordinary share capital of the |
| | Company immediately following the |
| | Admission |
+-----------------------------------+------------------------------------------+
| "enabled for settlement" | in relation to Open Offer Entitlements, |
| | enabled for the limited purpose of |
| | settlement of claim transactions and |
| | unmatched stock event transactions (each |
| | as described in the CREST Manual issued |
| | by Euroclear UK & Ireland) |
+-----------------------------------+------------------------------------------+
| "Euroclear UK & Ireland" or | Euroclear UK & Ireland Limited, the |
| "Euroclear" | operator of CREST |
+-----------------------------------+------------------------------------------+
| "Evolution" or "Broker" | Evolution Securities Limited |
+-----------------------------------+------------------------------------------+
| "Excess Application Facility" | the arrangement pursuant to which |
| | Qualifying Shareholders may apply for |
| | Open Offer Shares in excess of their |
| | Open Offer Entitlements |
+-----------------------------------+------------------------------------------+
| "Excess CREST Open Offer | in respect of each Qualifying CREST |
| Entitlement" | Shareholder, the entitlement to apply |
| | for Open Offer Shares in addition to his |
| | Open Offer Entitlement credited to his |
| | stock account in CREST, pursuant to the |
| | Excess Application Facility, which is |
| | conditional on him taking up his Open |
| | Offer Entitlement in full and which may |
| | be subject to scaling back in accordance |
| | with the provisions of this document |
+-----------------------------------+------------------------------------------+
| "Excess Open Offer Entitlement" | an entitlement for each Qualifying |
| | Shareholder to apply to subscribe for |
| | Open Offer Shares in addition to his |
| | basic Open Offer Entitlement pursuant to |
| | the Excess Application Facility which is |
| | conditional on him taking up his Open |
| | Offer Entitlement in full and which may |
| | be subject to scaling back in accordance |
| | with the provisions of this document |
+-----------------------------------+------------------------------------------+
| "Excess Shares" | New Ordinary Shares in addition to the |
| | Open Offer Entitlement for which |
| | Qualifying Shareholders may apply under |
| | the Excess Application Facility |
+-----------------------------------+------------------------------------------+
| "Excluded Territories" | the United States, Australia, Canada, |
| | Japan, the Republic of South Africa, the |
| | Republic of Ireland and any other |
| | jurisdiction where the extension or |
| | availability of the Open Offer would |
| | breach any applicable law or regulations |
+-----------------------------------+------------------------------------------+
| "Existing Articles" | the existing articles of association of |
| | the Company as at the date of this |
| | document |
+-----------------------------------+------------------------------------------+
| "Existing Ordinary Shares" | the existing issued ordinary shares of |
| | 30 pence each in the capital of the |
| | Company as at the date of this document |
+-----------------------------------+------------------------------------------+
| "Extraordinary General Meeting" | the extraordinary general meeting of the |
| or | Company convened for 11.00 a.m. on 30 |
| "EGM" | November 2009 (or any adjournment of |
| | it), notice of which is set out at the |
| | end of this document |
+-----------------------------------+------------------------------------------+
| "Facility Agreement" | the facility agreement dated 30 June |
| | 2008 and made between (1) the Company |
| | (2) Meridian Resources Ltd (3) Meridian |
| | Resources (USA) Inc. and (4) Macquarie |
+-----------------------------------+------------------------------------------+
| "Form of Proxy" | the form of proxy relating to the EGM |
| | being sent to Shareholders with this |
| | document |
+-----------------------------------+------------------------------------------+
| "FSA" | the Financial Services Authority in its |
| | capacity as the competent authority for |
| | the purposes of Part VI of FSMA and in |
| | the exercise of its functions in respect |
| | of admission to the Official List |
| | otherwise than in accordance with Part |
| | VI of FSMA |
+-----------------------------------+------------------------------------------+
| "FSMA" | the Financial Services and Markets Act |
| | 2000 (as amended) |
+-----------------------------------+------------------------------------------+
| "Group" | the Company and its subsidiary |
| | undertakings |
+-----------------------------------+------------------------------------------+
| "HMRC" | Her Majesty's Revenue & Customs |
+-----------------------------------+------------------------------------------+
| "ISIN" | International Securities Identification |
| | Number |
+-----------------------------------+------------------------------------------+
| "Issue Price" | 25 pence per New Ordinary Share |
+-----------------------------------+------------------------------------------+
| "Loan Facility" | the existing loan facilities made |
| | available to the Company and other |
| | members of its Group on the terms of the |
| | Facility Agreement |
+-----------------------------------+------------------------------------------+
| "London Stock Exchange" or the | London Stock Exchange plc |
| "LSE" | |
+-----------------------------------+------------------------------------------+
| "LCM" | Levine Capital Management Limited, a |
| | company registered in the British Virgin |
| | Islands under number 1533154 with |
| | registered office at OMC Chambers, |
| | Wickhams Cay 1, Road Town, Tortola, |
| | British Virgin Islands |
+-----------------------------------+------------------------------------------+
| "LCM UK" | Levine Capital Management Limited, a |
| | company registered in England under |
| | number 7015432 with registered offices |
| | at 6/8 York Place, Leeds LS1 2DS, United |
| | Kingdom, being a subsidiary of LCM |
+-----------------------------------+------------------------------------------+
| "Macquarie" | Macquarie Bank Limited |
+-----------------------------------+------------------------------------------+
| "Member Account ID" | the identification code or number |
| | attached to any member account in CREST |
+-----------------------------------+------------------------------------------+
| "Money Laundering Regulations" | the Money Laundering Regulations 2007, |
| | (as amended) |
+-----------------------------------+------------------------------------------+
| "New Articles" | the proposed new articles of association |
| | of the Company to be approved and |
| | adopted at the EGM |
+-----------------------------------+------------------------------------------+
| "New Ordinary Shares" | 29,352,998 ordinary shares of 1 penny |
| | each to be issued pursuant to the |
| | Capital Raising and the Subscription |
+-----------------------------------+------------------------------------------+
| "Open Offer" | the invitation to Qualifying |
| | Shareholders to subscribe for Open Offer |
| | Shares at the Issue Price on the terms |
| | of and subject to the conditions set out |
| | or referred to in Part IV of this |
| | document and, where relevant, in the |
| | Application Form |
+-----------------------------------+------------------------------------------+
| "Open Offer Entitlement" | the pro rata basic entitlement for |
| | Qualifying Shareholders to apply to |
| | subscribe for one Open Offer Share for |
| | every three Existing Ordinary Shares |
| | held by them on the Record Date pursuant |
| | to the Open Offer |
+-----------------------------------+------------------------------------------+
| "Open Offer Shares" | the 5,364,498 New Ordinary Shares for |
| | which Qualifying Shareholders are being |
| | invited to apply under the terms of the |
| | Open Offer and all of which have been |
| | underwritten by Evolution |
+-----------------------------------+------------------------------------------+
| "Options" | the options to subscribe for Existing |
| | Ordinary Shares which have been granted |
| | by the Company to the Optionholders |
+-----------------------------------+------------------------------------------+
| "Optionholders" | the employees of the Company (including |
| | Directors) who hold Options |
+-----------------------------------+------------------------------------------+
| "Overseas Shareholders" | Shareholders who are resident in, or who |
| | are citizens of, or who have registered |
| | addresses in, territories other than the |
| | United Kingdom |
+-----------------------------------+------------------------------------------+
| "Participant ID" | the identification code or membership |
| | number used in CREST to identify a |
| | particular CREST member or other CREST |
| | participant |
+-----------------------------------+------------------------------------------+
| "Placees" | the persons who conditionally agree to |
| | subscribe for the Placing Shares |
+-----------------------------------+------------------------------------------+
| "Placing" | the conditional placing as described in |
| | Part I of this document of the Placing |
| | Shares pursuant to the terms of the |
| | Placing Agreement |
+-----------------------------------+------------------------------------------+
| "Placing Agreement" | the agreement dated 30 October 2009 |
| | between the Company, Evolution and LCM |
| | relating to the Placing and Open Offer, |
| | details of which are set out in |
| | paragraph 6 of Part V of this document |
+-----------------------------------+------------------------------------------+
| "Placing Shares" | the 22,250,000 New Ordinary Shares being |
| | placed firm pursuant to the Placing and |
| | which are not being offered to |
| | Qualifying Shareholders pursuant to the |
| | Open Offer |
+-----------------------------------+------------------------------------------+
| "Proposals" | means, together, the Capital Raising, |
| | the Subscription, the Capital |
| | Reorganisation, amendments to the Loan |
| | Facility, cancellation of Options and |
| | Warrants, proposed board changes and |
| | proposed Change of Name |
+-----------------------------------+------------------------------------------+
| "Proposed Directors" | the proposed directors of the Company, |
| | being John Hamilton, Michael Cochran and |
| | Christopher Hopkinson |
+-----------------------------------+------------------------------------------+
| "Prospectus Rules" | the rules made by the FSA under Part VI |
| | of FSMA in relation to offers of |
| | transferable securities to the public |
| | and admission of transferable securities |
| | to trading on a regulated market |
+-----------------------------------+------------------------------------------+
| "Qualifying CREST Shareholders" | Qualifying Shareholders whose Existing |
| | Ordinary Shares on the register of |
| | members of the Company at the close of |
| | business on the Record Date are held in |
| | uncertificated form |
+-----------------------------------+------------------------------------------+
| "Qualifying non-CREST | Qualifying Shareholders whose Existing |
| Shareholders" | Ordinary Shares on the register of |
| | members of the Company at the close of |
| | business on the Record Date are held in |
| | certificated form |
+-----------------------------------+------------------------------------------+
| "Qualifying Shareholders" | holders of Existing Ordinary Shares on |
| | the Company's register of members at the |
| | Record Date (other than certain Overseas |
| | Shareholders) |
+-----------------------------------+------------------------------------------+
| "Record Date" | close of business on 28 October 2009 |
+-----------------------------------+------------------------------------------+
| "Redenominated Shares" | the ordinary shares of 1 penny each |
| | following the sub-division and |
| | reclassification of the Existing |
| | Ordinary Shares pursuant to the Capital |
| | Reorganisation |
+-----------------------------------+------------------------------------------+
| "Registrar", "Receiving Agent" | Equiniti Limited, Aspect House, Spencer |
| or "Equiniti" | Road, Lancing, West Sussex, BN99 6DA |
+-----------------------------------+------------------------------------------+
| "Regulatory Information Service" | a regulatory information service that is |
| | approved by the FSA and that is on the |
| | list of regulatory information service |
| | providers maintained by the FSA |
+-----------------------------------+------------------------------------------+
| "Resolutions" | the resolutions set out in the notice of |
| | the Extraordinary General Meeting at the |
| | end of this document |
+-----------------------------------+------------------------------------------+
| "Shareholders" | holders of Existing Ordinary Shares |
+-----------------------------------+------------------------------------------+
| "stock account" | an account within a member account in |
| | CREST to which a holding of a particular |
| | share or other security in CREST is |
| | credited |
+-----------------------------------+------------------------------------------+
| "Subscription" | the 1,738,500 New Ordinary Shares to be |
| | subscribed for by Macquarie and |
| | Optionholders at the time of the Placing |
| | and Open Offer, details of which are set |
| | out in Part I of this document |
+-----------------------------------+------------------------------------------+
| "subsidiary" | a "subsidiary undertaking" as that term |
| | is defined in the 2006 Act |
+-----------------------------------+------------------------------------------+
| "uncertificated" or | recorded on the relevant register or |
| "uncertificated form" | other record of the share or other |
| | security concerned as being held in |
| | uncertificated form in CREST, and title |
| | to which, by virtue of the CREST |
| | Regulations, may be transferred by means |
| | of CREST |
+-----------------------------------+------------------------------------------+
| "United Kingdom" or "UK" | the United Kingdom of Great Britain and |
| | Northern Ireland |
+-----------------------------------+------------------------------------------+
| "United States" or "US" | the United States of America, its |
| | territories and possessions and any |
| | state of the United States of America |
| | and the District of Colombia |
+-----------------------------------+------------------------------------------+
| "US person" | has the meaning provided in section |
| | 902(k) of Regulation S under the US |
| | Securities Act |
+-----------------------------------+------------------------------------------+
| "US Securities Act" | the United States Securities Act of |
| | 1933, (as amended) |
+-----------------------------------+------------------------------------------+
| "Warrants" | means the warrants issued to Macquarie |
| | over Existing Ordinary Shares |
+-----------------------------------+------------------------------------------+
This information is provided by RNS
The company news service from the London Stock Exchange
END
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