International Oil and Gas Tech Ltd Litigation Update (1311R)
22 Oktober 2013 - 5:05PM
UK Regulatory
TIDMOGT
RNS Number : 1311R
International Oil and Gas Tech Ltd
22 October 2013
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY, TO US PERSONS OR IN OR INTO THE
UNITED STATES, CANADA, AUSTRALIA, THE REPUBLIC OF SOUTH AFRICA, THE
REPUBLIC OF IRELAND, JAPAN OR ANY JURISDICTION IN WHICH THE SAME
WOULD BE UNLAWFUL.
22 October 2013
INTERNATIONAL OIL AND GAS TECHNOLOGY LIMITED
(the "Company")
LITIGATION UPDATE
The Company announces that QOGT Inc ("Quorum"), which commenced
proceedings against the Company on 16 January 2012, has given
notice that it is amending its proceedings for wrongful termination
of the original investment management agreement by withdrawing the
largest element of damages claimed against the Company, which
related to the management share options ("MSOPs"). This part
amounted to approximately US$9.2 million of the original amount
claimed of approximately US$15.2 million. Note that the Company has
consistently described the damages claimed by Quorum as
"speculative and far-fetched".
The damages originally claimed against the Company fall into
three heads of loss:
(i) Lost notice period;
(ii) Lost transaction fees and other fees from future
investments and fundraises by the Company; and
(iii) Losses arising in respect of MSOPS granted by the Company to Quorum.
The Company has always maintained that items (ii) and (iii)
above were comprised entirely of consequential losses and therefore
irrecoverable as a matter of English law. Furthermore, the manner
in which item (i) was calculated by Quorum also includes
consequential losses, in that the calculation of loss assumed that
(a) further fundraises and increases in the net asset value of the
Company would have taken place during the three years of the notice
period and (b) Quorum would have been paid an increased management
fee in respect of such increases.
Further, the Company has always maintained that, notwithstanding
that such consequential losses are not recoverable as a matter of
law, the assumptions that were used by Quorum to calculate the
losses were false. These assumptions include the past performance
of other funds managed by the Quorum group. Documentation already
disclosed by Quorum has demonstrated that its claimed track record
was incorrectly calculated in the pleadings.
The Company calculates that the only amount of damages that
would not be considered to include consequential losses concerns
the three year notice period calculated by reference to the net
asset value of the Company as at the date of termination. This
would amount to approximately US$ 3.4 million. However, the Company
continues to receive clear legal advice that the termination of
Quorum's contract was lawful and proper and therefore no liability
arises to pay even this amount.
Solicitors to Quorum assert that the MSOPs part of the damages
claimed is only being withdrawn because the Company has
insufficient assets to satisfy such damages. They assert that
Quorum believes that the assets of the Company are not worth the
amount originally claimed and so a sale of the assets of the
Company would be insufficient to meet the amount of damages.
The Company considers that this assertion is factually incorrect
as the net assets of the Fund far exceed even the larger amount
originally claimed. Further, it is confident, based on recent
offers to purchase certain of the Company's assets, that it would
be able to effect a sale of one or more assets to meet even the
full amount originally claimed by Quorum.
Finally, the Company considers that the explanation for
withdrawing the claim is disingenuous. It is a clear attempt to
avoid meeting any order for wasted costs that the Company may now
seek to make against Quorum in respect of work undertaken in
respect of the withdrawn heads of loss.
FOR FURTHER INFORMATION
Linton Capital LLP
David Sefton
Tel: +44 20 3384 8090
Numis Securities Limited
Nathan Brown
Tel: +44 20 7260 1426
NOTES TO EDITORS
International Oil and Gas Technology Limited ("IOGT") is an
authorised closed-ended investment company incorporated in
Guernsey. IOGT invests expansion capital into companies that
provide services and technology to the upstream oil and gas
industry. These companies have proprietary and proven technologies,
services and/or processes that can be deployed more rapidly or on a
larger scale through the introduction of growth capital. Such
companies are likely to have recurring annual revenues of between
US$5 million and US$25 million, positive EBITDA and/or significant
working capital, and strong management teams. IOGT was admitted to
the Official List of the UK Listing Authority and to trading on the
London Stock Exchange on 7 January 2008. Its stock market EPIC is
OGT.L. Further information can be found at
www.international-ogt.com.
This information is provided by RNS
The company news service from the London Stock Exchange
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