RNS Number:7961G
Sodra Petroleum AB
12 July 2001
12 July 2001
SODRA PETROLEUM AB
Sodra Petroleum AB announces that its parent company, Lundin Oil AB ("Lundin")
has today issued the following announcement:-
LUNDIN OIL
The shareholders of Lundin Oil AB (publ) ("Lundin Oil") are hereby given
notice to attend an Extraordinary General Meeting of the shareholders to be
held on 9 August 2001 at 2 p.m. at Berwaldhallen, Dag Hammarskjolds vag 3 in
Stockholm.
Notification of attendance
In order to participate at the General Meeting, a shareholder must:
* be registered in the share register maintained by VPC AB on Monday 30
July 2001 and;
* notify the Company of his participation not later than Friday 3 August
2001 by mail to Lundin Oil AB, Hovslagargatan 5, 111 48 Stockholm, by fax
to + 46 8-440 54 59, or by telephone to + 46 8-440 54 50. The application
should state the name, personal identification no./company no., and the
registered shareholding.
In order to be entitled to participate at the General Meeting, shareholders
whose shares are nominee-registered must in due time prior to 30 July 2001
ensure that the nominee causes the shares to be temporarily registered in the
shareholders' own name.
Proposed Agenda
1. Opening of the meeting.
2. Election of a Chairman for the meeting.
3. Preparation and approval of voting register.
4. Approval of the Agenda.
5. Election of one or two persons to attest the minutes.
6. Determination of whether the meeting has been duly convened.
7. The Board of Directors' proposals for amendments to the Articles of
Association entailing the introduction of a new class of shares, class C
shares.
8. The Board of Directors' proposals regarding a distribution of the
subsidiary, Lundin Petroleum AB, including resolutions for amendments to
the Articles of Association and a reduction in the share capital and share
premium reserve.
9. The Board of Directors' proposals for a new issue of class C shares.
10. Election of the Board of Directors.
11. The Board of Directors' proposals for a modification of the subscription
period for certain outstanding warrants.
12. Ratification of resolutions adopted by the subsidiary, Lundin Petroleum
AB, regarding an issue of debentures with detachable warrants.
13. Close of the meeting.
Background
On 21 June 2001, Talisman Energy Inc, through a wholly owned Swedish
subsidiary (collectively "Talisman"), made a public offer to the shareholders
and warrant holders in Lundin Oil (hereinafter referred to as the "Offer").
Pursuant to the Offer, Talisman will pay a cash amount of SEK 36.50 for each
class A and class B share in Lundin Oil. Pursuant to the offer to warrant
holders, Talisman will pay a cash amount of SEK 18.50 for each warrant of
series 1999/2002 and SEK 19.50 for each warrant of series 2000/2003. It is
proposed that the shares in Lundin Oil's wholly-owned subsidiary, Lundin
Petroleum AB (hereinafter "Lundin Petroleum"), be distributed to the
shareholders of Lundin Oil and the Offer is thus made exclusive of the right
to such shares.
Lundin Petroleum is a wholly-owned subsidiary of Lundin Oil and will
principally hold all of the Lundin Oil Group's rights with respect to oil
exploration in Sudan and all of the Lundin Oil Group's shares in Khanty
Mansiysk Oil Corporation.
It is intended that the shares in Lundin Petroleum will be listed on the
Stockholm Stock Exchange's New Market list following the distribution.
On 20 June 2001, the Board of Directors of Lundin Oil unanimously recommended
that the shareholders of Lundin Oil accept the Offer. The Board of Directors
proposes, in accordance with the terms and conditions of the Offer, that the
General Meeting of the shareholders adopt a resolution regarding the
distribution of all shares in the subsidiary, Lundin Petroleum. It is proposed
that the distribution be executed through a reduction of the share capital and
share premium reserve with repayment to the shareholders in the form of one
share in Lundin Petroleum for every share in Lundin Oil.
In the opinion of the Board of Directors, in accordance with what is commonly
referred to as Lex Asea, the distribution of the shares in Lundin Petroleum
will not entail any tax consequences for Lundin Oil's shareholders. Lundin Oil
intends to request that the National Tax Board issue recommendations regarding
the apportionment of the purchase between the shares in Lundin Oil and Lundin
Petroleum as a consequence of the distribution.
In order to implement the distribution the Board of Directors proposes the
adoption of the following resolutions.
Proposed resolutions
Agenda, item 7
Amendments to the Articles of Association entailing the introduction of a new
class of shares
The Board of Directors proposes that a new class of shares, class C, be
introduced. It shall be possible to issue the class C shares in order to
restore the share capital and share premium reserve in conjunction with the
distribution of the shares in Lundin Petroleum. The shares shall be subscribed
for by Talisman and shall not entail any right to receive shares in Lundin
Petroleum. In addition, the shares shall be redeemable and also carry
preference rights to dividends and to participate in the Company's assets in
the manner set forth below. Each class C share shall entitle the holder
thereof to one vote at General Meetings of the shareholders.
In accordance with the proposal for a reduction in the nominal value of the
shares and the introduction of class C shares, it is proposed that article 5
of the Articles of Association be worded as follows:
"Shares shall have a nominal value of SEK 0.50. Shares may be issued in three
classes, class A in an amount not exceeding 100% of all shares, class B in an
amount not exceeding 100% of all shares, and class C in an amount not
exceeding 100% of all shares.
Each class A share shall entitle the holder to 10 votes. Each class B and
class C share shall entitle the holder thereof to one vote.
Class C shares shall entitle the holder thereof, prior to any distribution to
the holders of class A and class B shares, to receive a yearly dividend from
the Company's distributable profit in an amount corresponding to 5 per cent of
SEK 36.50, and, if such dividend has not been given for one or more years, to
receive - prior to any dividend is given to holders of class A and class B
shares - the deficit from the distributable profit the following years.
In the event of the dissolution of the Company, class C shares shall entitle
the holder thereof, prior to any distribution to the holders of class A and
class B shares, to receive payment from the assets of the Company in an amount
per class C share of SEK 36.50 plus interest calculated from the date of
payment of the subscription price until the date of distribution at an annual
rate of interest of 5 percent.
In the event the Company resolves to issue new class A, class B, and/or class
C shares through a cash issue, the holders of shares of each respective class
shall hold pre-emption rights to subscribe for shares of the same class in
proportion to the number of shares held prior thereto (primary pre-emption
rights). Shares that are not subscribed for pursuant to primary pre-emption
rights shall be offered to all shareholders for subscription (secondary
pre-emption rights). Where such offered shares are insufficient for
subscription pursuant to secondary pre-emption rights, the shares shall be
allotted between the subscribers in proportion to the total number of shares
held in the Company prior thereto. To the extent such cannot take place with
respect to a specific share/shares, allotment shall take place through the
drawing of lots.
In the event the Company resolves to issue shares of only one class, class A,
class B, or class C through a cash issue, all shareholders shall have
pre-emption rights to subscribe for new shares in proportion to the number of
shares held prior thereto, irrespective of the class of shares held.
The above provisions shall not entail any restriction on the possibility to
adopt resolutions regarding cash issues by way of derogation from
shareholders' pre-emption rights.
In conjunction with an increase in share capital through bonus issues, new
shares shall be issued of each class in proportion to the number of shares of
the same class held prior thereto. In conjunction therewith, old shares of a
specific class shall afford the holders thereof pre-emption rights to
subscribe for new shares of the same class.
Upon request by a holder of class C shares or following a resolution adopted
by a General Meeting of the shareholders, the share capital may be reduced,
however not below the minimum share capital, through the redemption of class C
shares. Requests for redemption by shareholders shall be submitted in writing
to the Company's Board of Directors and the Board shall process the requests
with expediency.
The redemption amount per class C share shall be SEK 36.50."
Agenda, item 8
Resolutions regarding distribution of the subsidiary, Lundin Petroleum AB,
including a resolution for amendments to the Articles of Association and a
reduction in the share capital and share premium reserve.
The Board of Directors proposes a distribution of the subsidiary, Lundin
Petroleum AB, including a resolution for amendments to the Articles of
Association and a reduction in the share capital and share premium with an
amount equal of Lundin Oil's book value for the shares in Lundin Petroleum as
follows.
* A reduction in the share capital by not more than SEK 5,430,000, through
a reduction in the nominal value of the Company's shares pursuant to
article 5 of the Articles of Association from SEK 0.5 to SEK 0.45. At
present, there are 102,861,283 outstanding shares in Lundin Oil. Prior to
the General Meeting of the shareholders 3,342,501 class B shares will be
issued in conjunction with the redemption of shares in Sodra Petroleum. In
addition thereto outstanding warrants entail an entitlement to subscribe
for 2,350,000 new shares.
* A reduction in the share premium reserve by not more than SEK
800,000,000.
* The purpose of the reduction in the share capital and share premium
reserve is to effect a repayment to the shareholders. The repayment will
take place through the distribution to the shareholders of all of Lundin
Oil's shares in the subsidiary, Lundin Petroleum. The total amount of the
reduction to be repaid through the distribution to the shareholders shall
equal Lundin Oil's book value for the shares in Lundin Petroleum including
the assets to be acquired by Lundin Petroleum from Lundin Oil.
* The distribution shall take place in the form of distribution rights,
each of which shall entitle the holder thereof to one share in Lundin
Petroleum. The distribution rights shall be converted automatically into
shares in Lundin Petroleum following registration of the resolutions to
reduce the share capital and the new issue (see item 9 on the agenda)
* The proposed record date for the right to receive distribution rights is
16 August 2001 and, accordingly, commencing 14 August 2001 shares in
Lundin Oil will be traded exclusive of the right to receive distribution
rights.
A significant portion of Lundin Petroleum's assets relate to oil exploration
activities in the Republic of Sudan, a country against which the United States
government maintains a comprehensive trade embargo. Because there is a
significant risk that such sanctions may apply to U.S. shareholders and U.S.
holders of GDSs if Lundin Petroleum shares are distributed to them, Lundin Oil
will structure the distribution so as to issue rights that will entitle
shareholders to receive shares in Lundin Petroleum, arrange that shares
received in respect of rights for U.S. shareholders be sold on behalf of U.S.
shareholders and U.S. holders of GDSs and have the net cash proceeds of sale
to be distributed to U.S. shareholders and U.S. holders of GDSs. A detailed
description of the manner in which such sales will be made and information
relating to such sanctions will be set forth in the "Information Brochure"
that will be sent to all holders of Lundin Oil's shares prior to the
extraordinary general meeting.
Agenda, item 9
Resolution regarding new issue of class C shares
In order to enable the distribution of shares in Lundin Petroleum to take
place to the shareholders of Lundin Oil in conjunction with the Offer, the
reduction in the share capital and share premium reserve must be restored
through a simultaneous new issue pursuant to which Lundin Oil receives an
amount corresponding to not less than the amount of the reduction which
thereby restores the share capital and the share premium reserve.
Accordingly, the Board of Directors proposes that the General Meeting of the
shareholders adopts a resolution regarding a new issue of not less than
17,000,000 and not more than 22,000,000 class C shares, each with a nominal
value of SEK 0.45. The shares shall be issued at a price of SEK 36.50 per
share, which corresponds to the amount offered by Talisman to the shareholders
of Lundin Oil in accordance with the Offer. Subscription and payment shall
take place not later than 31 October 2001. Notwithstanding shareholders'
pre-emption rights, Talisman shall be entitled to subscribe. The reason for
the deviation from shareholders' pre-emption rights is to enable the
distribution of the shares in Lundin Petroleum to take place.
Through the new issue, Lundin Oil shall be provided with a total amount in the
range of not less than SEK 620,500,000 and not more than SEK 803,000,000,
which amount shall correspond or exceed the amount of the reduction.
Agenda, item 10
Election of the Board of Directors
Shareholders holding more than 30 percent of the voting capital in Lundin Oil
propose that a new Board of Directors be elected. The resolution shall be
conditional upon shares having not less than a majority of the votes having
been tendered in the Offer and not withdrawn and Talisman having subscribed
and paid for the class C shares issued in accordance with item 9 above.
Accordingly, the election of the Board of Directors shall only take place if
such occurs.
Agenda, item 11
Modification of the subscription period for certain outstanding warrants
The Board of Directors proposes that the General Meeting of the shareholders
adopt a resolution to modify the subscription period for certain outstanding
warrants as follows.
In accordance with a resolution adopted by the Annual General Meeting of the
shareholders on 4 May 2000, Lundin Oil has issued 1,200,000 warrants. 400,000
of these warrants entitle the holders thereof to subscribe for shares during
the period 22 May 2002 - 22 May 2003. The Board of Directors proposes that
these warrants may be exercised for subscription during the period 10 August
2001 - 22 May 2003.
The reason for the proposal is to enable the holders of such warrants to
exercise the warrants and subscribe for new shares prior to the expiration of
the acceptance period for the Offer.
Agenda, item 12
Ratification of a resolution adopted by the subsidiary, Lundin Petroleum AB,
regarding an issue of debentures with detachable warrants
On 20 June 2001, an Extraordinary General Meeting of the shareholders of
Lundin Petroleum adopted a resolution regarding an issue of 2,500,000
debentures, each with a nominal value of SEK 0.01. A detachable warrant is
attached to each debenture and entitles the holder to subscribe for one new
share in Lundin Petroleum at a subscription price corresponding to the
weighted average of the quoted price during the first twenty trading days
following the market quotation. In the event the shares are not listed prior
to 31 December 2001, the subscription price shall amount to SEK 6. The
warrants may be exercised for subscription during the period 1 May 2002 - 1
May 2004. Notwithstanding shareholders' pre-emption rights, the party entitled
to subscribe shall be a wholly owned subsidiary of Lundin Petroleum. The
subsidiary shall detach the warrants and assign the warrants without any
consideration in exchange therefor, or alternatively issue employee stock
options with equivalent terms and conditions, to employees of Lundin
Petroleum.
The reason for the deviation from shareholders' pre-emption rights is that the
Board of Directors of Lundin Petroleum believes that it is beneficial for the
Company that employment benefits for the Group's employees shall partly
consist of warrants, which will enable Lundin Petroleum to recruit and retain
highly qualified personnel within the Group, at the same time as cash salary
expenses may be reduced. The dilution effect in the event of full exercise of
the warrant in accordance with the proposal is approximately 2.5 percent.
The resolution regarding the issue is conditional on the shares in Lundin
Petroleum being distributed to the shareholders in accordance with items 7-9
above. Accordingly, the issue will only be carried out in the event Talisman
declaring the Offer unconditional.
The resolution regarding an issue by Lundin Petroleum is subject to the
provisions of the Act Concerning Certain Directed Issues in Stock Market
Companies. In order for the resolution to be valid, the resolution must be
supported at the General Meeting of the shareholders of Lundin Oil by
shareholders holding at least nine tenths of the shares voted and represented
at the shareholders meeting.
Documents prior to the General Meeting of the shareholders
The Board of Directors' full proposals for resolutions in accordance with
items 7-12 (including, inter alia, the exact amount of the reduction in share
capital and share premium reserve), will be made available at Lundin Oil
(address and telephone number as above) not later than 2 August 2001 and will
be sent to the shareholders upon request to the address provided to the
Company.
Stockholm, July 2001
LUNDIN OIL AB (publ)
The Board of Directors
For further information, please contact:
Ian H. Lundin, President
Tel: +41 22 319 66 00
or
Maria Hamilton,
Corporate Communications
Tel :+46 8 440 54 50
Notes for editors:
1. Lundin is the parent company of Sodra by virtue of its holding of
40,506,500 Ordinary Shares of SEK0.05 each. The 40,506,476 Convertible Shares
of SEK0.05 each in Sodra listed on the AIM market are effectively convertible
into the right to subscribe for B Shares in Lundin in November 2001. Upon
exercise of the conversion right, for every 12 Convertible Shares, the holder
will receive a warrant to subscribe for 1 new Lundin B Share at the nominal
value of SEK0.50.
2. Convertible Shares in Sodra are also listed on the New Market of the
Stockholm Stock Exchange. Lundin B Shares are currently quoted on the
Stockholm Stock Exchange, Toronto Stock Exchange and the Nasdaq National
Market.
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