AGM Information • Nov 28, 2022
AGM Information
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THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the action you should take, you are recommended immediately to seek your own personal financial advice from your stockbroker, bank manager, solicitor, accountant or other appropriate independent financial adviser who is duly authorised under the Financial Services and Markets Act 2000, if you are in the United Kingdom, or from another appropriately authorised independent financial adviser if you are in a territory outside the United Kingdom.
If you have sold or transferred, or sell or transfer before 6.30 p.m. on Tuesday, 13 December 2022, your entire holding of Ordinary Shares, please send this document (but not any personalised Form of Proxy) as soon as possible to the purchaser or transferee of those shares or to the stockbroker, bank or other agent through whom the sale or transfer was effected, for onward transmission to the purchaser or transferee. However, such documents should not be forwarded or transmitted in or into any jurisdiction in which such an act would constitute a violation of the relevant laws of such jurisdiction.
The distribution of this document and any accompanying documents in or into jurisdictions other than the United Kingdom may be restricted by local law and therefore persons into whose possession this document and any accompanying documents come should inform themselves about and observe such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.
(Incorporated in Scotland with registered number SC226712)
Proposed Share Premium Account Cancellation and Notice of General Meeting
This document should be read as a whole and in conjunction with the accompanying Form of Proxy. Your attention is drawn to the letter from the Chair of Capricorn which is set out on pages 2 - 4 of this document recommending, on behalf of the Directors, that you vote in favour of the Resolution to be proposed at the General Meeting referred to below.
Notice of the General Meeting, to be held at the Capricorn Energy PLC Head Office at 50 Lothian Road, Edinburgh EH3 9BY at 3.00 p.m. on Thursday, 15 December 2022, is set out at the end of this document.
Enclosed with this document is a Form of Proxy for use in respect of the General Meeting. You are requested to complete, sign and return the Form of Proxy as soon as possible, and in any event, so as to arrive at the offices of the Company's registrars, Equiniti, Aspect House, Spencer Road, Lancing, West Sussex BN99 6DA, not later than 3.00 p.m. on Tuesday, 13 December 2022. Alternatively, you may register your proxy appointment or voting directions electronically via the www.sharevote.co.uk website (further information regarding the use of this facility is set out in the notes to the notice of General Meeting) not later than 3.00 p.m. on Tuesday, 13 December 2022. If you hold your Ordinary Shares in CREST, you may appoint a proxy by completing and transmitting a CREST Proxy Instruction so as to be received by the Company's registrars, Equiniti, not later than 3.00 p.m. on Tuesday, 13 December 2022.
This document contains (or may contain) certain forward-looking statements with respect to certain of Capricorn's plans and its current goals and expectations relating to its future financial condition and performance and which involve a number of risks and uncertainties. Capricorn cautions readers that no forward-looking statement is a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking statements. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forwardlooking statements sometimes use words such as "aim", "anticipate", "target", "expect", "estimate", "intend", "plan", "goal", "believe", or other words of similar meaning. Examples of forward-looking statements include statements regarding or which make assumptions in respect of future events. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances, including, but not limited to, economic and business conditions, the effects of continued volatility in credit markets, market-related risks such as changes in the price of oil or changes in interest rates and foreign exchange rates, the policies and actions of governmental and regulatory authorities, changes in legislation, the success of future acquisitions and other strategic transactions and the impact of competition. A number of these factors are beyond Capricorn's control. As a result, Capricorn's actual future results may differ materially from the plans, goals and expectations set forth in Capricorn's forward-looking statements. Any forwardlooking statements made in this document by or on behalf of Capricorn speak only as of the date they are made. Except as required by any applicable laws, the Listing Rules, the Disclosure and Transparency Rules or other regulations, Capricorn expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forwardlooking statements contained in this document to reflect any changes in Capricorn's expectations with regard thereto or any changes in events, conditions or circumstances on which any such statement is based.
All references in this document to "US dollars", "US\$" and "\$" are to the lawful currency of the United States.
| Page | |
|---|---|
| LETTER FROM THE CHAIR OF CAPRICORN ENERGY PLC | 2 |
| DEFINITIONS | 5 |
| NOTICE OF GENERAL MEETING | 6 |
Questions of a factual nature relating to the Resolution to be proposed at the General Meeting may be directed to the Company's registrars, Equiniti, using the telephone helpline number +44 (0)371 384 2660. Lines are open from 8.30 a.m. to 5.30 p.m. (UK time) Monday to Friday (excluding English and Welsh public holidays). Calls to the helpline from outside the UK will be charged at the applicable international rate. Please note that calls to these numbers may be monitored or recorded for security and training purposes.
This helpline will not be able to provide advice on the merits of the Resolution to be proposed at the General Meeting or the Share Premium Account Cancellation, or give personal, legal, financial or tax advice.
(Incorporated in Scotland with registered number SC226712)
Nicoletta Giadrossi (Non-Executive Chair) Keith Lough (Non-Executive Director) Peter Kallos (Non-Executive Director) Alison Wood (Non-Executive Director) Catherine Krajicek (Non-Executive Director) Erik Daugbjerg (Non-Executive Director) Luis Araujo (Non-Executive Director) Simon Thomson (Chief Executive) James Smith (Chief Financial Officer)
Registered and Head Office: 50 Lothian Road Edinburgh EH3 9BY
28 November 2022
To Shareholders
Dear Shareholder
On 28 November 2022, Capricorn announced that it intends to seek Shareholder approval for the Share Premium Account Cancellation. The purpose of this document is to provide Shareholders with information on the proposed Share Premium Account Cancellation.
A general meeting of the Company is to be held at the Capricorn Energy PLC Head Office at 50 Lothian Road, Edinburgh EH3 9BY at 3.00 p.m on Thursday, 15 December 2022 to seek the approval of Shareholders to the proposed Share Premium Account Cancellation. The notice of that general meeting is set out at the end of this document.
Capricorn proposes to cancel its share premium account in order to create additional distributable reserves (of approximately US\$495.1 million) which (subject to any arrangements required for the protection of Capricorn's creditors and any directions given by the Court in confirming the Share Premium Account Cancellation) may be used by Capricorn to deliver returns to Shareholders in the future, whether in the form of dividends, distributions or purchases of the Company's own shares.
As at close of business on Thursday, 24 November 2022 (being the latest practicable date prior to the date of this document), the Company had US\$495,086,926 standing to the credit of its share premium account. Share premium forms part of the capital of a company, which arises on the issue of shares at a premium to their nominal value, with the premium element being credited to its share premium account. Under the Companies Act 2006, companies are generally prohibited from paying any dividends or making other distributions in the absence of distributable reserves, and the share premium account, being a non-distributable reserve, can be applied only for limited purposes. However, provided a company obtains the approval of its shareholders by way of a special resolution and the subsequent requisite confirmation by the Court, it may cancel its share premium account and the amount so cancelled may be credited to its profit and loss account.
The Share Premium Account Cancellation is conditional upon, amongst other things, the Resolution being passed at the General Meeting and the subsequent confirmation by the Court. If Shareholders approve the Resolution, then the Directors intend to petition the Court to obtain its confirmation of the Share Premium Account Cancellation. Before it will confirm the Share Premium Account Cancellation, the Court will be concerned that the interests of the Capricorn's creditors will be sufficiently protected. The terms upon which the Court is prepared to sanction the Share Premium Account Cancellation will be subject to consideration in due course by the Court and discussion between Capricorn and its advisers. Capricorn's ability to make any future returns to Shareholders from the additional distributable reserves arising from the Share Premium Account Cancellation will be dependent on any directions of the Court for the protection of creditors at the time the Share Premium Account Cancellation takes place. The Directors reserve the right to discontinue the application to the Court if they consider it appropriate and in the interests of the Company. The Share Premium Account Cancellation will only become effective once the Court order confirming it is filed with the Registrar of Companies.
The Share Premium Account Cancellation itself will not involve any distribution of share premium to the Shareholders, nor will it reduce the underlying net assets of the Company. If it becomes effective, the Share Premium Account Cancellation will not change the number of Ordinary Shares in issue (or their nominal value) (and no new share certificates will be issued as a result of the Share Premium Account Cancellation) and will not affect the voting or dividend rights of any Shareholder, or the rights of any Shareholder on a return of capital.
The Share Premium Account Cancellation should not have any UK tax consequences for Shareholders. It should be treated as a reorganisation of the share capital of the Company, and accordingly should not result in a disposal or deemed disposal by any Shareholders. After the Share Premium Account Cancellation, the Ordinary Shares should be treated as the same asset as was originally acquired by each Shareholder for tax purposes and, therefore, the base cost of the Ordinary Shares should remain unaffected.
A general meeting of the Company will be held at the Capricorn Energy PLC Head Office at 50 Lothian Road, Edinburgh EH3 9BY at 3.00 p.m. on Thursday, 15 December 2022 to propose the Resolution seeking Shareholder approval of the Share Premium Account Cancellation. The notice of that meeting is set out at the end of this document. A summary explanation of the Resolution to be proposed at the General Meeting is set out in paragraph 5 below.
Whether or not Shareholders intend to attend the General Meeting in person, they are strongly encouraged to ensure that their votes are counted at the General Meeting by appointing the chair of the General Meeting as their proxy and submitting their completed Form of Proxy as soon as possible. Further instructions on voting by proxy are set out in paragraph 7 below.
The Board remains committed to allowing Shareholders the opportunity to engage with the Board. If Shareholders have any questions for the Board in advance of the General Meeting, these can be sent by e-mail to [email protected]. The Board will endeavour to answer key themes of these questions on the Company's website as soon as practical.
The Resolution to be proposed at the General Meeting proposes the cancellation of the share premium account of the Company. The Resolution will be proposed as a special resolution and accordingly will be passed if at least 75 per cent. of the votes cast are in favour. If it is passed and becomes effective, then (subject to any arrangements required for the protection of the Company's creditors and any directions given by the Court in confirming the Share Premium Account Cancellation) the full amount of the reserve arising as a result of such cancellation (of approximately US\$495.1 million) will be credited to the Company's profit and loss account. The cancellation of the Company's share premium account requires to be confirmed by the Court and, if the Resolution is passed, the Directors intend to petition the Court for such confirmation.
If Shareholders approve the Resolution, then the Directors intend to petition the Court (shortly after the General Meeting) to commence the Court process in respect of the confirmation of the Share Premium Account Cancellation. Subject to the Court's availability and the Court process, it is hoped that the Court hearing to confirm the Share Premium Account Cancellation will be during the last week of January or first weeks of February 2023. Any changes to this timetable will be notified to Shareholders by an announcement on an RIS.
Enclosed with this document is a Form of Proxy for use in respect of the General Meeting. You are requested to complete, sign and return the Form of Proxy as soon as possible, and in any event, so as to arrive at the offices of the Company's registrars, Equiniti, Aspect House, Spencer Road, Lancing, West Sussex BN99 6DA, not later than 3.00 p.m. on Tuesday, 13 December 2022.
Alternatively, you may register your proxy appointment or voting directions electronically via the www.sharevote.co.uk website (further information regarding the use of this facility is set out in the notes to the notice of General Meeting) not later than 3.00 p.m. on Tuesday, 13 December 2022. If you hold your Ordinary Shares in CREST, you may appoint a Proxy by completing and transmitting a CREST Proxy Instruction so as to be received by the Company's registrars, Equiniti, not later than 3.00 p.m. on Tuesday, 13 December 2022.
The Board is of the opinion that the Share Premium Account Cancellation and the Resolution to be proposed at the General Meeting are in the best interests of Shareholders as a whole. Accordingly, the Board unanimously recommends that you vote in favour of the Resolution, as the Directors intend to do in respect of their own beneficial holdings amounting in aggregate to 744,346 Ordinary Shares representing approximately 0.236 per cent. of the current issued share capital of Capricorn (as at Thursday, 24 November 2022, being the last practicable date prior to the publication of this document).
Yours faithfully
Nicoletta Giadrossi
Chair
The following definitions apply throughout this document and in the accompanying Form of Proxy, unless the context requires otherwise:
| "Board" or "Directors" | the board of directors of Capricorn, from time to time, or, where appropriate, any duly authorised committees of it; |
|---|---|
| "Company" or "Capricorn" | Capricorn Energy PLC, a company incorporated in Scotland with registered number SC226712; |
| "Court" | the Court of Session, Edinburgh; |
| "CREST" | the relevant system for the paperless settlement of trades in securities and the holding of uncertificated securities (as defined in the Uncertificated Securities Regulations 2001 (SI. 2001 No. 3775)) operated by Euroclear; |
| "CREST Manual" | the current version of the CREST manual from time to time which at the date of this document is available on www.crestco.co.uk; |
| "CREST Proxy Instruction" | a properly authenticated CREST message appointing and instructing a proxy to attend and vote in the place of the Shareholder at the General Meeting and containing the information required to be contained therein by the CREST Manual; |
| "Disclosure and Transparency Rules" |
the Disclosure Guidance and Transparency Rules of the FCA; |
| "Electronic Proxy Instruction" | a proxy instruction submitted electronically at www.sharevote.co.uk using the numbers included in the Form of Proxy; |
| "Equiniti" | Equiniti Limited, Aspect House, Spencer Road, Lancing, West Sussex, BN99 6DA; |
| "Euroclear" | Euroclear UK & International Limited; |
| "FCA" | the Financial Conduct Authority; |
| "Form of Proxy" | the form of proxy enclosed with this document, for use by Shareholders in connection with the General Meeting; |
| "FSMA" | Financial Services and Markets Act 2000 (as amended); |
| "General Meeting" | the general meeting of Capricorn to be held at the Capricorn Energy PLC Head Office at 50 Lothian Road, Edinburgh EH3 9BY at 3.00 p.m. on Thursday, 15 December 2022, notice of which is set out at the end of this document; |
| "ISIN" | International Security Identification Number; |
| "Listing Rules" | the listing rules made by the FCA for the purposes of Part VI of FSMA; |
| "Official List" | the official list maintained by the FCA for the purposes of Part VI of FSMA; |
| "Ordinary Shares" | the issued ordinary shares of 21/13 pence each in the capital of Capricorn and admitted to the premium segment of the Official List under the ISIN GB00BN0SMB92; |
| "Resolution" | the resolution to be proposed at the General Meeting; |
| "RIS" or "Regulatory Information Service" |
a regulatory information service as defined by the Listing Rules; |
| "Share Premium Account Cancellation" |
the proposed cancellation of the share premium account of the Company; |
| "Shareholders" | holders of Ordinary Shares; |
| "UK" or "United Kingdom" | the United Kingdom of Great Britain and Northern Ireland; and |
| "US" or "United States" | the United States of America, its territories, possessions, any State of the United States of America and the District of Columbia. |
(Incorporated in Scotland with registered number SC226712)
NOTICE IS HEREBY GIVEN that a general meeting of Capricorn Energy PLC (the "Company") will be held at the Capricorn Energy PLC Head Office at 50 Lothian Road, Edinburgh EH3 9BY at 3.00 p.m. on Thursday, 15 December 2022 for the purposes of considering and, if thought fit, passing the following Resolution, which will be proposed as a special resolution:
THAT, subject to the confirmation of the Court of Session, the amount standing to the credit of the share premium account of the Company be cancelled.
50 Lothian Road Edinburgh EH3 9BY
28 November 2022
personal member or sponsored member or has appointed a voting service provider(s), to procure that his or her CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted by means of the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST sponsors or voting service provider(s) are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST system and timings, which can be viewed at www.euroclear.com. The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in regulation 35(5)(a) of the Uncertificated Securities Regulations 2001.
Donnelley Financial Solutions 394852
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