XENITRA LIMITED — AGM Information 2013

Feb 3, 2013

==> picture [209 x 123] intentionally omitted <==

Titan Energy Services Limited ACN 150 110 017

Notice of Extraordinary General Meeting

to be held at

Date: 5 March 2013 Time: 9.00am (Brisbane time) Place: Thomsons Lawyers, Level 16, Waterfront Place, 1 Eagle Street, Brisbane, Queensland 4000

This is an important document and requires your attention

This document should be read in its entirety.

If you are in any doubt about how to deal with this document, please consult your legal, financial or other professional advisor.

1

legal/40979746_1

==> picture [86 x 52] intentionally omitted <==

Notice of Extraordinary General Meeting

Notice is given that an Extraordinary General Meeting of shareholders of Titan Energy Services Limited ACN 150 110 017 (the Company ) will be held at 9.00am (Brisbane time) on 5 March 2013 at Level 16, Waterfront Place, 1 Eagle Street, Brisbane, Queensland 4000.

Agenda

Resolution 1 – Ratification of the issue of First Tranche Placement Shares

To consider and, if thought fit, to pass the following resolution as an ordinary resolution of the Company:

'That for the purposes of ASX Listing Rule 7.4 and for all other purposes, shareholders ratify the issue of 3,889,525 fully paid ordinary Shares at an issue price of $1.05 per share, issued by way of a placement ( First Tranche Placement Shares ), on the terms and conditions set out in the Explanatory Memorandum accompanying this Notice of General Meeting.'

Voting exclusion

The Company will disregard and not count any votes cast (in any capacity) on this Resolution by or on behalf of any or all of the following persons:

• (a) any person who participated in the issue of Shares; and

• (b) any of their associates.

However, the Company need not disregard a vote if:

• it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or

• it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy for to vote as the proxy decides.

Resolution 2 – Approval for the issue of Second Tranche Placement Shares

To consider and, if thought fit, to pass the following resolution as an ordinary resolution of the Company:

'That for the purposes of ASX Listing Rule 7.1 and for all other purposes, shareholders approve the issue of 6,590,475 fully paid ordinary Shares at an issue price of $1.05 per share by way of a placement ( Second Tranche Placement Shares ), on the terms and conditions set out in the Explanatory Memorandum accompanying this Notice of General Meeting.'

Voting exclusion

The Company will disregard and not count any votes cast (in any capacity) on this Resolution by or on behalf of any or all of the following persons:

• (c) any person who may participate in the issue of Shares and any person who may obtain a benefit, except a benefit solely in the capacity of a holder of ordinary shares if the Resolution is passed; and

• (d) any of their associates.

However, the Company need not disregard a vote if:

• it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or

• it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy for to vote as the proxy decides.

2

legal/40979746_1

==> picture [86 x 52] intentionally omitted <==

Resolution 3 – Approval for Mr James Sturgess to participate in the Share Placement

To consider and, if thought fit, to pass, with or without amendment the following resolution as an ordinary resolution:

‘That for the purpose of Listing Rule 10.11 and for all other purposes, approval be given for the issue of 142,857 Shares to James Sturgess or his nominee.’

Voting Exclusion Statement

The Company will disregard any votes cast on this resolution by any Mr James Sturgess, his nominee and any of their associates.

However, the Company need not disregard a vote if:

• it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or

• it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

Resolution 4 – Approval for the giving of financial assistance

To consider and, if thought fit, to pass the following resolution as a special resolution of the Company:

'That for the purposes of sections 260A and 260B of the Corporations Act and for all other purposes, approval is given for Hofco Oil Field Services Pty Ltd ( Hofco ) to provide financial assistance to the Company in relation to the acquisition by the Company of shares in Hofco, as set out in the Explanatory Memorandum accompanying this Notice of General Meeting.'

Dated: 4 February 2013

By order of the Board

==> picture [116 x 59] intentionally omitted <==

…………………………………. David Thornton Company Secretary

3

legal/40979746_1

==> picture [86 x 52] intentionally omitted <==

Notes

• 1 The Directors have determined pursuant to Regulation 7.11.37 of the Corporations Regulations 2001 (Cth) that the shareholding of each member for the purposes of ascertaining their voting entitlements at the Extraordinary General Meeting will be as it appears in the share register at 7.00pm (Sydney time) on 3 March 2013 . Accordingly, those persons are entitled to attend and vote at the meeting.

• 2 If you are eligible, you may vote by attending the meeting in person or by proxy or attorney. A member who is a body corporate may appoint a representative to attend and vote on its behalf.

• 3 To vote by proxy, please complete, sign and return the enclosed proxy form in accordance with the following instructions. If you require an additional proxy form, the Company will supply it on request.

• 4 A member who is entitled to vote at the meeting, may appoint one proxy if the member is only entitled to one vote or one or two proxies if the member is entitled to more than one vote. A proxy need not be a member of the Company.

• 5 Where the member appoints two proxies, the appointment may specify the proportion or number of votes that each proxy may exercise. If the appointment does not specify a proportion or number, each proxy may exercise one-half of the votes, in which case any fraction of votes will be disregarded.

• 6 The proxy form must be signed by the member or the member’s attorney. Proxies given by a corporation must be executed in accordance with the Corporations Act and the constitution of that corporation.

• 7 To be effective, the proxy form and the power of attorney or other authority (if any) under which it is signed or a certified copy, must be received by the Company at least 48 hours before the time for holding of the meeting or any adjourned meeting:

• (a) By mail c/- Link Market Services Limited, Locked Bag A14, Sydney South NSW 1225;

• (b) Online at www.investorcentre.linkmarketservices.com.au. Login to the Link website using the details as shown on the proxy form. Select 'Voting' and follow the prompts to lodge your vote. To use the online voting facility, Securityholders will need their "Holder Identifier" (Securityholder Reference Number ( SRN ) or Holder Identification Number ( HIN ) as shown on the front of the proxy form); or

• (c) By facsimile to +61 2 9287 0309.

• 8 Any proxy form received after this deadline including at the meeting will be treated as invalid. 9 The Chairman intends to vote all undirected proxies in favour of the Resolutions.

4

legal/40979746_1

==> picture [86 x 52] intentionally omitted <==

Explanatory Memorandum

This Explanatory Memorandum has been prepared to assist shareholders with their consideration of the resolution to be put to the Extraordinary General Meeting to be held at 9.00am (Brisbane time) on 5 March 2013 at Thomsons Lawyers, Level 16, Waterfront Place, 1 Eagle Street, Brisbane, Queensland 4000.

The Explanatory Memorandum should be read with, and form part of, the accompanying Notice of Extraordinary General Meeting.

1 Background

1.1 Acquisition of Hofco Oil Fields Services Pty Ltd

Titan Energy Services is a diversified oil and gas services business with a focus on the rapidly growing CSG-LNG industry in eastern Australia.

On 4 February 2013, the Company entered into a Share Sale and Purchase Agreement ( Agreement ) to acquire 100% of the shares in Hofco Oil Field Services Pty Ltd ABN 65 010 166 702 ( Hofco ).

Hofco is an oilfield rental and drilling tool supply company, currently servicing Australia, New Zealand and Papua New Guinea. Hofco was established in 1980 as a down hole drilling tool rental and directional supervision company, it has grown over time and now supplies drill pipe, non magnetic drill collars, mud pumps, wire line units and many other items. It is known for its exceptional customer service and quality rental tools and services.

Details of the proposed acquisition were made in a separate announcement to ASX on 4 February 2013.

The proposed acquisition will be funded by a combination of an equity raising by way of a pro-rata entitlement offer and a Share Placement ( Capital Raising ). In conjunction with the proposed acquisition, the Company will also increase the available amounts under its existing senior debt facilities.

1.2 Share Placement

The Company has secured firm commitments to place 10,480,000 Shares to sophisticated, professional and other investors to whom no disclosure is required under the Corporations Act at $1.05 per Share to raise up to approximately $11,000,000 (before costs) ( Share Placement ).

As the Share Placement exceeds the Company's placement capacity under Listing Rule 7.1, the

• (a) first tranche of 3,889,525 Shares is expected to be issued without shareholder approval on 13 February 2013;and

• (b) second tranche of 6,590,475 Shares is subject to shareholder approval, and if approved, is expected to be issued on or about 8 March 2013.

The funds raised from the Share Placement will be used to fund the Hofco acquisition.

5

legal/40979746_1

==> picture [86 x 52] intentionally omitted <==

2 Resolution 1 – Ratification of the issue of First Tranche Placement Shares

2.1 Background

It is expected that by the date of this meeting, the First Tranche Placement Shares will have been issued. Accordingly, in anticipation of that issue the Company is seeking shareholder ratification for the issue.

2.2

Regulatory requirements

Under Listing Rule 7.1, subject to certain exceptions, a listed company is prohibited from issuing or agreeing to issue shares without shareholder approval if, in doing so, it would mean that the number of shares issued in the preceding 12 month period would exceed 15% of the number of fully paid ordinary shares on issue at the beginning of the 12 month period ( Placement Capacity ).

Listing Rule 7.4 provides that an issue of shares made by a company without the prior approval of shareholders may be treated as having been made with shareholder approval if:

• (a) at the time the issue took place, it did not breach Listing Rule 7.1; and

• (b) the shareholders of the company, in general meeting, subsequently ratify the issue of the shares.

The issue of First Tranche Placement Shares will be made in accordance with Listing Rule 7.1 and, in anticipation of the issue, the Company seeks shareholder ratification in accordance with Listing Rule 7.4.

2.3 Effect of shareholder ratification

If Resolution 1 is passed, the Company will retain the flexibility to issue further shares up to its Placement Capacity, in the next 12 month period without shareholder approval.

2.4 Information required by Listing Rule 7.5

The following information is required by ASX Listing Rule 7.5 for the purposes of shareholder ratification under ASX Listing Rule 7.4:

ratification under ASX Listing Rule 7.4:
Number of Shares allotted	3,889,525
Price at which Shares were issued	$1.05
The basis on which allottees were determined	The shares will be allotted to sophisticated investors (in accordance with sections 708(8) and (10) of the Corporations Act), professional investors (in accordance with section 708(11) of the Corporations Act) and other investors to whom no disclosure is required under the Corporations Act.
The terms of the Shares issued	All shares issued under the Share Placement will be fully paid ordinary shares in the Company that rank pari passu and form one class with all other ordinary shares of the Company.
The use (or intended use) of the funds raised	To fund the acquisition of Hofco.
Voting exclusion statement	A voting exclusion applies to this resolution – please see the notes to Resolution 1.

6

legal/40979746_1

==> picture [86 x 52] intentionally omitted <==

2.5 Directors' Recommendation

The Directors (with James Sturgess abstaining due to their personal interests) recommend that shareholders vote in favour of this resolution.

3 Resolution 2 - Approval for the issue of Second Tranche Placement Shares

3.1 Background

The issue of the Second Tranche Placement Shares will exceed the Company's Placement Capacity. Accordingly shareholder approval is sought under Listing Rule 7.1 for the issue of the Second Tranche Placement Shares.

3.2 Effect of shareholder approval

If Resolution 2 is passed, the Company will be able to issue the Second Tranche Placement Shares and retain its flexibility to manage its capital requirements and issue Shares where necessary within its Placement Capacity.

3.3

Information required by Listing Rule 7.3

The following information is required by ASX Listing Rule 7.3 for the purposes of shareholder approval under ASX Listing Rule 7.1:

Details of the potential allottees to be issued shares under the Share Placement	The shares will be allotted to sophisticated investors (in accordance with sections 708(8) and (10) of the Corporations Act), professional investors (in accordance with section 708(11) of the Corporations Act) and other investors to whom no disclosure is required under the Corporations Act.
Potential maximum number of Shares to be issued	6,590,475
The issue price of the Shares	$1.05
The date by which the Company will issue and allot the Shares	If approved, it is anticpated that the Shares will be issued and allotted on or about Friday 8 March 2013 and in any event no later than 3 months after the date of the meeting as required by the Listing Rules.
The terms of the Shares to be issued	All shares issued under the Share Placement will be fully paid ordinary shares in the Company that rank pari passu and form one class with all other ordinary shares of the Company.
The use (or intended use) of the funds raised	To fund the acquisition of Hofco
Voting exclusion statement	A voting exclusion applies to this resolution – please see the notes to Resolution 2.

3.4 Directors' Recommendation

The Directors (with James Sturgess abstaining due to their personal interests) recommend that shareholders vote in favour of this resolution.

7

legal/40979746_1

==> picture [86 x 52] intentionally omitted <==

4 Resolution 3 – Approval for the issue of Shares to Mr James Sturgess under the Share Placement

4.1 Background

The managing director, Mr James Sturgess, wishes to participate in the Share Placement.

4.2

ASX Listing Rule requirements

Listing Rule 10.11 provides that a listed company must not issue or agree to issue equity securities to a related party without the approval of shareholders.

Accordingly, the Company is seeking approval for Mr Sturgess to be issued up to 142,857 Shares.

Information required by Listing Rule 10.13 is set out below:

Maximum number of Shares that may be acquired by Mr Sturgess	142,857 Shares
Issue Price	$1.05 per Share issued
Terms of the issue	All shares issued will be fully paid ordinary shares in the Company that rank pari passu and form one class with all other ordinary shares of the Company.
Intended use of funds raised	The funds will be used to assist the funding of the Hofco acquisition.
Date by which Shares will be issued	If approved, it is intended that the Shares be issued on or about 8 March 2013, and in any event no later than one month after the general meeting.

4.3 Voting exclusion

A voting exclusion applies in relation to Resolution 3 (see notes to Resolution 3).

4.4

Recommendation of Directors

The Directors (with Mr Sturgess abstaining due to his personal interest) recommend that shareholders vote in favour of this Resolution.

5 Resolution 4 - Approval for the giving of financial assistance

5.1 Background

The Company's senior lender is GE Commercial Corporation (Australia) Pty Ltd ( GE Capital ) under a Facility Agreement ( Facility Agreement ). GE Capital has consented to the acquisition of Hofco, subject to an environmental compliance review, on customary terms and conditions.

One of the conditions of GE Capital's consent is that following the completion of the acquisition of Hofco, it is required to:

• (a) enter into an Accession Deed in relation to the Facility Agreement under which Hofco becomes a party to the Facility Agreement and a guarantor and an obligor, in each case for all purposes of and connected with the Facility Agreement;

• (b) give a guarantee and indemnity for the repayment of money that may become owing, in relation to the senior facility; and

8

legal/40979746_1

==> picture [86 x 52] intentionally omitted <==

• (c) enter into a general security agreement over all of its existing and after acquired property which will be registered on the Personal Property Securities Register.

(collectively the Finance Documents )

Hofco's obligations under the Finance Documents include:

• (a) unconditionally and irrevocably guaranteeing the performance of the obligations (including payment obligations) of the Company;

• (b) indemnifying GE Capital against any liability, loss, or cost incurred under the senior lending documents (including the Finance Documents); and

• (c) giving security interests over its assets to secure its obligations and the obligations of the Company under the Finance Documents from time to time.

5.2 Regulatory compliance – sections 260A and 260B of the Corporations Act

Section 260A of the Corporations Act

Under section 260A of the Corporations Act, a company may financially assist a person to acquire shares in the company or a holding company of the company only if:

• (a) giving the assistance does not materially prejudice:

• (i) the interests of the company or its shareholders; or

• (ii) the company's ability to pay its creditors; or

• (b) the assistance is approved by shareholders under section 260B of the Corporations Act; or

• (c) the assistance is exempted under section 260C of the Corporations Act.

Section 260B of the Corporations Act

Under section 260B of the Corporations Act, if immediately after the acquisition, the company will have an Australian listed holding company, the financial assistance must be approved by special resolution of the holding company. If the acquisition proceeds, the Company will be the holding company of Hofco at the time it enters into the Finance Documents and provides the financial assistance. Accordingly, shareholders of Titan are asked to approve the proposed financial assistance.

Section 260B(2) of the Corporations Act requires shareholder approval for financial assistance by Hofco to be approved by special resolution passed at a general meeting of the Company. Accordingly, to approve the proposed financial assistance, it will be necessary for at least 75% of shareholders to vote in favour of the resolution.

Approval sought

Entering into, and performing obligations under, the Finance Documents as set out above would, for the purposes of section 260A of the Corporations Act, constitute Hofco giving financial assistance to Titan to acquire shares in Hofco.

Accordingly, shareholder approval is sought for the provision of that financial assistance.

This explanatory statement is given to members of the Company for the purposes of section 260B(4) of the Corporations Act. It contains information known to the Company material to deciding how to vote on Resolution 4. Copies of the notice to shareholders of the proposed resolution and this explanatory statement were lodged with the Australian Securities and Investments Commission before being sent to shareholders, in accordance with section 260B(5) of the Corporations Act.

9

legal/40979746_1

==> picture [86 x 52] intentionally omitted <==

5.3 Effect of giving the financial assistance

The benefit to Titan of the proposed financial assistance is that a key condition of GE Capital's consent to the acquisition of Hofco and the extension of the senior facilities will be satisfied and, accordingly, the proposed Hofco acquisition can proceed.

The acquisition will benefit Hofco because, by becoming part of a listed group, it will have greater access to capital and opportunities for growth.

The provision of the proposed financial assistance by Hofco may impact on its ability to pay amounts owing to creditors if there is a default under the senior lending arrangements and Hofco is called upon to pay any guaranteed amounts. Further, if GE Capital is entitled to enforce any of its rights under the Finance Documents, the enforcement may have a materially adverse impact on Hofco by enabling GE Capital to procure the sale of Hofco's assets.

The Directors do not have any reason to believe that the Company (or any applicable subsidiary or related entity of it) is likely to default in its obligations under the senior lending arrangements.

5.4 Recommendation of Directors

The Directors recommend that shareholders vote in favour of Hofco giving the proposed financial assistance for the reasons above.

6 Definitions

ASX means ASX Limited (ACN 008 624 691) trading as the Australian Securities Exchange.

Company means Titan Energy Services Limited ACN 150 110 017.

Corporations Act means the Corporations Act 2001 (Cth).

Listing Rules means the Official Listing Rules of the ASX.

Share means a fully paid ordinary share in the capital of the Company.

10

legal/40979746_1